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Pope Benedict XVI Prepares to Visit New York Synagogue; Will Democratic Bickering put McCain in the White House?; McCain Releases Tax Information, But Excludes Wife's Finances

Aired April 18, 2008 - 16:00   ET

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


WOLF BLITZER, CNN ANCHOR: Thanks very much, guys.
Happening now, the Democrats battling over who's the biggest complainer. Hillary Clinton and Barack Obama can't stand the heat. Hillary Clinton says Barack Obama can't stand the heat that is. But the Obama camp says Clinton has done her share of griping as well.

Also this hour, inside John McCain's tax returns. Newly released numbers don't tell the full story about his wealth. We'll explain.

And Pope Benedict turns his focus to New York and to human rights. How did his call for global intervention play at the United Nation?

I'm Wolf Blitzer. You're in THE SITUATION ROOM.

Hillary Clinton once complained that Barack Obama was the darling of political reporters. Now she's suggesting he isn't tough enough to endure red hot media scrutiny. This comes two days after a debate Obama likened to a game of gotcha. And it comes four days before the Pennsylvania primary.

Our senior political correspondent, Candy Crowley, is in Philadelphia with the CNN election express. She's watching this story for us.

Candy, it looks like the Obama camp is expressing outrage that the Clintons would take this line of attack.

CANDY CROWLEY, CNN SENIOR POLITICAL CORRESPONDENT: Well, there's a lot of back and forth going on here today. I think the bottom line, Wolf, for the Clinton campaign is they're pointing to a new Gallup tracking poll which shows her closing the gap a bit on a national level, saying that this shows the debate effect. They're continuing to push the debate and what happened in the debate, but they're now talking about the post debate period.

(BEGIN VIDEOTAPE)

CROWLEY (voice-over): Debating the debate, day two.

SEN. HILLARY RODHAM CLINTON (D-NY), PRESIDENTIAL CANDIDATE: Some of my opponent supporters and my opponent are kind of complaining about the hard questions. Well, having been in the White House for eight years and seeing what happens in terms of the pressures and the stresses on a president, that was nothing.

CROWLEY: "Her blatant hypocrisy here is stunning," said an Obama spokesman, reminding supporters of this.

H. CLINTON: If anybody saw "Saturday Night Live" maybe we should ask Barack if he's comfortable and needs another pillow. I find it kind of curious I keep getting the first question on all of these issues. But I'm happy to answer it.

CROWLEY: This is more than the ridiculous discussion it seems. It's superdelegate strategy.

WILLIAM JEFFERSON CLINTON, FORMER PRESIDENT OF THE UNITED STATES: This is a contact sport. If you don't want to play, keep your uniform off.

CROWLEY: The idea is to convince lawmakers and party officials likely to settle this race that she is a battle hardened pro and he is an unknown, untested rookie who can't withstand a Republican assault. Certainly there's been the taste of fall. In Erie today, Obama as he often does campaigned past Clinton to engage the presumptive Republican nominee.

SEN. BARACK OBAMA (D-IL), PRESIDENTIAL CANDIDATE: Just yesterday, John McCain went on television, I want to get this right, went on television and said there has been, "great progress economically over the last seven and a half years."

CROWLEY: Furious the McCain campaign accused Obama of being recklessly dishonest, noting McCain also said any economic progress is no comfort to those suffering now. As Obama campaigned through another middle-class venue, he countered Clinton's rookie strategy with a continuing slow roll of endorsements.

Today a trio of Washington insiders with hefty resumes. Former Georgia senator and foreign policy heavyweight Sam Nunn. Former Oklahoma Senator David Boren and former Clinton labor secretary Robert Reich.

Superdelegate message, the train is moving.

(END VIDEOTAPE)

CROWLEY: Of course, both these campaigns know that the best superdelegate strategy is to gather up pledged delegates and popular vote in the 10 contests ahead -- Wolf.

BLITZER: Those endorsements today for Obama from Sam Nunn and David Boren, I thought those were pretty surprising. Robert Reich not necessarily all that surprising. What did you think? Because of both of those former senators were sort of moderate, mainstream almost conservative Democrats and now they're going ahead and endorsing Obama.

CROWLEY: Absolutely. And I think it becomes at a propitious moment when increasingly Obama is getting hit by the McCain campaign as being too liberal, a classic liberal. And it also says something to the party establishment. Even as Clinton pounds him as too inexperienced to take over the presidency, he is getting these old guard endorsements. And I think that helps him.

BLITZER: And I'm going to be speaking later in THE SITUATION ROOM with Robert Reich. And we'll get his explanation of what tipped the balance. Until now he had been - he tried to be neutral. He served as Clinton's labor secretary, went to law school with the Clintons, I think was a Rhodes Scholar with Bill Clinton at one point. There's a long history.

For him to now go ahead and formally endorse Obama, the Obama people must be elated. What do you think?

CROWLEY: Well, I think there have been these sorts of endorsements before. I am reminded of Governor Bill Richardson of New Mexico who endorsed Obama and the Clinton campaign was furious. They do believe, however, I mean, when asked about this, someone in the Clinton campaign said, oh, well, didn't Reich endorse him last year? So they're kind of tossing it off. But these are the sort of endorsements that you think got to hurt a little at the personal level.

BLITZER: I'm sure it does.

Thanks very much, Candy.

As I said, I'll be speaking with Robert Reich later here in THE SITUATION ROOM.

Republican John McCain is giving voters a new glimpse into his personal finances. He released his 2006 and 2007 income tax returns today.

Let's go to our Dana Bash. She's covering the McCain campaign for us.

The new numbers, Dana, correct me if I'm wrong, don't necessarily reflect McCain's full family assets, do they?

DANA BASH, CNN CONGRESSIONAL CORRESPONDENT: You know, Wolf, John McCain is actually considered one of the wealthiest members of Congress. In fact, "Roll Call" newspaper ranked him ninth wealthiest out of 535 lawmakers.

But you're right. You really wouldn't know it looking at the tax returns released today by his presidential campaign. In 2007 McCain's total income was $405,409. His taxable was $258,800. He paid $188,660 in taxes.

What the campaign didn't release were tax returns for McCain's wife, Cindy. She of course is an heiress to a fortune from her father's beer distribution empire. That was - it's called Hensley and Company. She's now the chairman of that company. According to last year's Senate financial disclosure form, the McCain's have assets of at least $36.5 million. Some estimates put her worth at about $100 million.

But Wolf, before marrying 27 years ago the McCains signed a prenuptial agreement. And that keeps their finances separate and they file their taxes separately. And McCain's campaign said Cindy is not releasing her returns in the words of the campaign in the interest of protecting the privacy of her children.

But remember, Michelle Obama who also of course has very young children, she did release her tax records. She filed those jointly with her husband, Barack Obama. The DNC Chairman Howard Dean issued a statement a short while ago calling McCain's lack of transparency,"troubling." Said not releasing Cindy McCain's taxes, "raises questions about what he's hiding."

Ironically, Wolf, you probably remember, I can tell you now McCain advisers are defending not releasing his wife's tax records by comparing it to Democrat John Kerry, his campaign four years ago. What you do remember then is his multimillionaire wife Teresa Heinz Kerry, she refused to disclose all of her tax return. That's something Republicans complained about, I should say.

Let's go back to John McCain and a little bit more about what he did disclose today. First of all, he received more than $58,000 from his Navy -- from the Navy for his pension. He's 71-years-old. And the presumptive Republican nominee also got $23,000 last year in Social Security. He paid nearly $18,000 in alimony to his ex-wife.

He actually earned nearly $177,000 in royalties from the books that he sold. And he donated along with his wife all of that money to charity. Let's look at some of the charity. Because it's interesting. McCain gave an additional $17,000 in charity. All told, John McCain donated about 26 percent of his income to charity.

Wolf, by comparison, the Clintons gave 15 percent and the Obamas, they gave six percent.

BLITZER: Interesting. Very interesting. You also said, correct me if I'm wrong, about a month or two ago that he would release his medical records by April 15. It's now April 18. What's the delay?

BASH: That's right. It was about a month ago, maybe more that John McCain was actually coming from a doctor's appointment. He said he would release his medical records right about now. Then immediately his campaign said, well, you know, it might be a couple of days later.

The McCain campaign told us a couple weeks ago they're actually not going to release his medical records until next month, sometime in May. The reason they give, Wolf, is they say they're trying to line up all of his doctors because they insist they want his doctors to be at a press conference available to answer reporters' questions about McCain's health. Of course you remember he had skin cancer eight years ago and obviously he would be, if elected, the oldest president. So they understand his health is a big issue.

But, you know, it's going to be May before we get any kind of -- or any kind of medical records from him. They did release a lot of records back in 1999, the first time he ran for president.

BLITZER: That was before the melanoma, though.

BASH: Exactly.

BLITZER: All right. Thanks very much, Dana, for that.

We'll continue to watch this story.

Let's see how McCain's total income of about $405,000 compares to some other big name political types. Remember McCain filed separately from his very wealthy wife, Cindy. George and Laura Bush reported a combined income of more than $900,000 last year. Dick and Lynn Cheney had a total income of more than $3 million. Barack and Michelle Obama earned a total of $4 million last year and Hillary and Bill Clinton out-earned them all last year with a total income of more than $20 million.

Let's turn now to Pope Benedict's historic trip to the United States. He arrived in New York earlier today after his visit here in Washington. Right now he's preparing to visit a synagogue in New York. The first time a pope has ever done that in the United States.

Earlier Benedict spoke to the United Nations General Assembly. He urged diplomats to intervene in nations unable to protect their own people from human rights abuses. And he praised the U.N.'s goals of peace and justice.

(BEGIN VIDEO CLIP)

POPE BENEDICT XVI, LEADER OF CATHOLIC CHURCH: We see images of the effects of war and poverty, we are reminded of our duty to strive for a better world. And we rejoice in the sheer diversity and exuberance of human culture.

(END VIDEO CLIP)

BLITZER: We're going to have a full report on the pope's United Nation's address, his trip to New York City, that's coming up shortly here in THE SITUATION ROOM.

Let's go to Jack Cafferty. He's got "The Cafferty File" -- Jack.

JACK CAFFERTY, CNN ANCHOR: All right, Wolf. Thank you.

You thought it would never get here but it's going to. Crunch time in Pennsylvania now. Hillary Clinton, Barack Obama down to their last weekend of campaigning before next Tuesday's primary. The stakes couldn't be any higher either. Especially for Hillary Clinton. The latest average of polls taken in Pennsylvania show her ahead of Obama by just five points. Down sharply from the double digit lead that she held for a long time. Months, even. Although Clinton is expected to win, the key is by how much. "The Wall Street Journal" reports anything less than a double digit victory would make Obama appear more and more like the inevitable nominee. This could also trigger a flow of super delegates into Obama's camp. On the other hand, a strong Clinton win might persuade superdelegates to at least stay neutral a while longer. Indiana, North Carolina vote May 6. Experts say Clinton needs to win in Pennsylvania by at least eight to 10 points in order for voters in the other upcoming states, Indiana and North Carolina, to see it as a real victory.

A loss in Pennsylvania could be the end for Hillary Clinton, putting a lot of pressure on her to simply drop out. New Jersey governor and Clinton supporter says a loss in Pennsylvania would be a door closer. He calls it a key state because she needs to win the popular vote.

Clinton aides point out they've been out spent by Barack Obama by as much as three to one in Pennsylvania. And if he can't deliver a victory there it's another sign he can't win the big states. Meanwhile, polls show that after six weeks of intense campaigning in Pennsylvania, about nine percent of voters in that state are still unsure about who they're going to support.

So here's our question: In the last weekend before the Pennsylvania primary, what do Barack Obama and Hillary Clinton have to do to win over the late undecided voters?

Go to CNN.com/caffertyfile. You can post a comment on my blog -- Wolf.

BLITZER: Jack, thank you for that. See you shortly.

The Democrats are criticizing John McCain when it comes to the economy. But the Republican's plan isn't playing all that well with members of his own party. We'll speak about that and more with the deputy chairman of the Republican National Committee. This is issue number one, the economy.

Many Barack Obama supporters have a bone to pick and they're venting their anger online. Is Obama creating a new political movement?

And Hillary Clinton is asking if Obama is simply tough enough to be president. We'll ask the question as well in our "Strategy Session." Lots of news happening today right here in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: As we just reported, John McCain's campaign has now put out his tax returns. It shows he earned just more than $405,000 last year, paid just more than $118,000 in taxes. But that's separate from his wife's earnings and taxes. She has not released her tax returns. Some estimates put her worth at about $100 million. Joining us now is Frank Donatelli, he's the deputy chairman of the Republican National Committee.

Thanks for coming in. FRANK DONATELLI, DEPUTY CHAIR, RNC: Hi, Wolf.

BLITZER: Should he release all of her income taxes as well instead of just keeping that quiet?

DONATELLI: Well, I think with the campaign has said is Senator McCain has always released his tax returns. He's going to continue to do that. But since they've been married they've always filed separate taxes. And so for purposes of what has to be filed under the disclosure laws, I think this is sufficient to give the public a good idea of Senator McCain's income and what he spent his money on.

BLITZER: Because that was an argument, a similar argument was made in 2004 by Republicans that Teresa Heinz, the wife of John Kerry, Teresa Heinz Kerry, she should release all of her income tax returns as well. The then RNC chairman Ed Gillespie called on Kerry to release her tax returns. If it was good enough for the Republicans then to say then the American public deserved to know the income of a spouse, why not now?

DONATELLI: I think that was a while ago. But my recollection was there was some question about a residence and it was transferred from one spouse to the other and it was valued low for purposes of getting a loan for the campaign or something like that. The details go back some. But there's no such allegation here. I mean, Cindy McCain's assets are not in any way used to subsidize the campaign.

BLITZER: So as of right now based on everything you know, the American public is not going to know the extent of her wealth?

DONATELLI: Well, we feel like that we have given the American public sufficient information so that they know exactly what Senator McCain's income is, and as I say, what he spent his money on.

BLITZER: All right.

Let's talk a little bit about his economic plan, Senator McCain's economic plan. He says that there should be a holiday, if you will, on federal gas taxes. Given the high gas prices right now over the summer months when people are driving, they should avoid those taxes.

Lamar Alexander, a Republican senator, as you know, from Tennessee, he said this, he said, "I don't like that proposal on the gas tax. He's entitled to make his own statements. As I said, I agree with him on a bulk of what he said on Tuesday but I don't agree with him on that."

What's your reaction?

DONATELLI: I guess my reaction is the Republican Party is a big tent. We have a lot of different opinions. What I think Senator McCain was trying to suggest was, number one, if gas taxes - if gas prices are very high, couldn't we at least do a little something for a couple of months to give a break to families that have very, very high tax bills? I think the second point, though, Wolf, is it's an indication of how much taxes are built into the fabric of American society. And many times people don't really know how much taxes they're really paying because the tax collectors have a way of hiding that from the American people.

And so taxes have a much greater impact on the average American, maybe, than people think. And so if people have a better idea of how much they're really paying in taxes, maybe they'll be more supportive of Senator McCain's plans to keep taxes low.

BLITZER: Very quickly, how worried are you, if you are worried at all, that some of the conservatives who originally expressed their dislike for John McCain are going to be enthusiastic going into this election in November? Because as you know, Karl Rove, among others, they say if conservatives aren't actively involved it could be toast for a Republican candidates.

DONATELLI: My conversations with conservatives and I talk to them all the time are that they will be involved. Our surveys already show, Wolf, conservatives and Republicans are as united behind John McCain already as they were with George W. Bush eight years ago roughly at this same time. And we have lots of time to go. So I have no doubt at all that when we have John McCain running against one of the liberal Democrats that the conservatives will be strongly in support of Senator McCain.

BLITZER: Frank Donatelli, he is the deputy chairman of the RNC, Frank, thanks for coming in.

DONATELLI: OK. Thank you.

BLITZER: The man so beloved on the world stage takes center. The pope travels to the United Nations with a special message for world leaders. Do not do to others what you would not want done to you. Who exactly was he addressing?

And in our "Strategy Session," when the going gets tough, Democrats want to know who will be the toughest? Barack Obama or Hillary Clinton?

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

(COMMERCIAL BREAK)

BLITZER: Carol Costello is monitoring other important stories incoming to THE SITUATION ROOM right now.

Carol, what's going on?

CAROL COSTELLO, CNN CORRESPONDENT: Amid turmoil in the housing market he hopes to help Americans buy homes or keep the one they have. Steve Preston, President Bush picked to be the next secretary for housing in urban development. The president calls Preston an experienced minister well versed in finance. Preston, who administers the Small Business Administration needs Senate confirmation. He'll replace Alphonso Jackson who is leaving under chargers of political favoritism.

The prime minister says it's a mark of honor but protesters say it's a symbol of shame. The Olympic torch made its way to Bangkok today where it will be run tomorrow. Calling it an honor to have the flame in his country, the prime minister, says, "Whoever tries to destroy the flame is crazy and unreasonable." But just in case his warnings won't work, more than 1,000 police will help protect the torch run.

And regarding those children taken from a polygamist sect in Texas, today a psychiatrist testified the children are taught that disobeying orders is a major sin and that the children can rarely make independent choices. All that from the second day of a hearing to determine whether the state will keep custody of the children or whether they should be returned to their parents.

Those are the headlines right now, Wolf.

BLITZER: See you in a few moments, Carol. Thank you.

The pope has a special message to world leaders. And it was heard around the world. We're going to tell you about that message of compassion delivered today at the United Nations.

And one group apparently says if you mess with Barack Obama, you're messing with them. Right now, they're showing just what actions they'll take to defend him.

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

(COMMERCIAL BREAK)

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

Happening now, the pope's historic U.S. visit. He delivers a special message of compassion to world leaders. And moments from now a special message for a rabbi whose life was very different than the pope's when they were boys during World War II.

Also a former president meets with what the U.S. considers to be a terrorist group. Now Republicans and Democrats release an avalanche of criticism. Wait till you hear what some say should happen to Jimmy Carter.

The strongest earthquake in 40 years rocks part of the Midwest. Is that region prepared should it happen again?

I'm Wolf Blitzer. You're in THE SITUATION ROOM.

In presidential politics, many people are voicing very strong opinions about Wednesday's debate between Hillary Clinton and Barack Obama. While some think it was tough but fair, others say the questioning was unfairly slanted against Obama. And they're not dealing with their anger silently.

Let's go to our senior political analyst Bill Schneider. He is joining us now with more on the story.

So what are we seeing online specifically in response to that debate, Bill?

WILLIAM SCHNEIDER, CNN SENIOR POLITICAL ANALYST: Wolf, we may be seeing the power of something new in American politics.

(BEGIN VIDEOTAPE)

SCHNEIDER (voice-over): The Obama campaign is not just a campaign. It's a movement.

UNIDENTIFIED FEMALE: The grassroots being active all over the country are not going to be stopped.

SCHNEIDER: They are furious about the debate this week. And responding with an outpouring of online rage.

UNIDENTIFIED MALE: We're not living in the -- in the -- in the world of sound bites anymore. We're living in a world of sound blasts and a 15-minute news cycle.

SCHNEIDER: We have seen political movements in this country before, Barry Goldwater in 1964, George McGovern in 1972. They both failed to win. But they transformed American politics. They brought in new people, new issues, and new passions.

The Obama movement also brings in a new tool to rally voters: the Internet. What would happen if the Democratic superdelegates decided to nominate Hillary Clinton?

UNIDENTIFIED FEMALE: If they are perceived as undercutting the will of the voters, which right now is Senator Obama, we're going to see an enormous amount of frustration.

SCHNEIDER: If Obama gets to the nomination, what would John McCain be facing in the general election?

UNIDENTIFIED MALE: The race would be a battle between the 20th century politics and the 21st century politics, where online organizing is going to go right up against the traditional models.

SCHNEIDER: Previous movements, like Goldwater and McGovern, failed because they were divisive. Obama's critics aim to expose him as a left-wing ideologue.

UNIDENTIFIED MALE: Barack Obama, if he wins the Democratic nomination, will be the more liberal candidate for president of the United States in the history of our country.

SCHNEIDER: What's driving the Obama movement is not just anti- Bush or anti-war sentiment. It's exasperation with politics as usual. Obama is running against the politics of division.

When he talks about us vs. them, "them" are the political insiders, the Washington establishment, the news media, the people who brought you...

(END VIDEOTAPE)

SCHNEIDER: One other thing that Obama would have going for him if he's the Democratic nominee, and that would be a broad desire for change in this country. That was not the case when Goldwater ran in 1964, and it was not the case when McGovern ran in 1972 -- Wolf.

BLITZER: All right, Bill, thank you.

Bill's in Philadelphia for us, getting ready for Tuesday's primary.

This hour, Pope Benedict XVI is preparing for another papal first. He will be visiting a synagogue in New York City. The pope made history earlier in the day when he addressed the United Nations General Assembly.

Let's bring in our senior United Nations correspondent, Richard Roth, who is watching the story for us.

What kind of reception did the pontiff receive at the U.N., Richard?

RICHARD ROTH, CNN SENIOR U.N. CORRESPONDENT: Well, based on an initial applause meter, you might say pretty favorable, one man, nearly 200 countries. The pope took the world stage.

(BEGIN VIDEOTAPE)

(APPLAUSE)

ROTH (voice-over): Pope Benedict XVI entered center stage down the aisle of the United Nations General Assembly, the fourth U.N. appearance by a pope, and, for this pope, a unique greeting.

UNIDENTIFIED MALE: So, Your Holiness, happy birthday and happy anniversary.

(APPLAUSE)

ROTH: But Benedict XVI told those cheering delegates they could do a better job respecting the human rights of their citizens. The 81-year-old pope quoted an old adage embraced by a score of religions, ancient and modern.

POPE BENEDICT XVI: Do not do to others what you would not want done to you.

ROTH: The pope did not name names or nations. But he did appear to have the U.S. invasion of Iraq in mind when he praised international rule for the common good.

POPE BENEDICT XVI (through translator): This is even more necessary in the current context, where we are witnessing the clear paradox of the multilateral consensus, which continues to be in crisis because it is still subordinated to the decisions of a small number.

ROTH: A cornerstone of the U.N. is The World Declaration on Human Rights, a document the pope came to honor at the U.N. and which he suggested some member states are ignoring.

Hundreds of thousands are dead in Darfur, Sudan, accusations in Tibet of human rights violations, and wars ranging from Somalia to Afghanistan. Perhaps alluding to Sudan and Darfur, the pope said every U.N. state should protect its own people. But he strongly supported a U.N. principle, usually disregarded, of a wider responsibility by the world to act.

POPE BENEDICT XVI (through translator): If states are unable to guarantee such a protection, it is then up to the international community to intervene with the legal means that are provided for under the charter of the United Nations.

ROTH: The pope got an even warmer welcome later in the same hall from the U.N. staff. He thanked them for being willing to risk their lives in the field.

And the pope stopped to touch the tattered U.N. blue flag which flew over the U.N. compound in Baghdad, where more than 20 U.N. staffers died when it was struck by a suicide bomber in 2003.

(END VIDEOTAPE)

ROTH: The pope, who knows 10 languages, employed English and French. But his stress on dialogue and diplomacy was music to the ears, Wolf, of these ambassadors. But whether they follow up on the appeals, it remains an open question -- Wolf.

BLITZER: All right, thank you, Richard.

Richard's at the U.N.

By the way, it's been over 40 years since the first time a pope spoke to the United Nations General Assembly. Paul VI pushed for nuclear disarmament back in 1965, when the Cold War was raging. Pope John Paul II came to New York in 1979, not long after he became pontiff.

Crowds lined the streets in New York to welcome him. He spoke to the General Assembly that year about the turbulence in the Middle East and the rise of materialism. John Paul returned to the U.N. in 1995 to give an address on human freedom.

Some big corporations are now slashing thousands of jobs. We're going to bring you the cold, hard numbers and ask our own Ali Velshi if they're a sign of even tougher times to come.

Plus, will voters care that John McCain's wealthy wife is not releasing her tax returns? We will toss that around and more in our "Strategy Session."

And, later, I will ask the former Clinton labor Secretary Robert Reich why he decided to support Barack Obama. Does Reich see it as a slap at his old friends, the Clintons?

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

(COMMERCIAL BREAK)

BLITZER: Sadly, thousands more people will soon be out of work. Citigroup says it will cut about 9,000 jobs, after it reported another quarterly loss, this time losing $5 billion -- that's with a B -- $5 billion. The telecommunications giant AT&T will cut just more than an estimated 4,600 jobs.

Meanwhile, a much different picture over at Google. The company posted impressive first-quarter earnings and says it hired more than 2,300 new workers in the quarter.

Let's go to our senior business correspondent, Ali Velshi. He's in New York watching this story for us.

So, what's more significant, Ali, the good news from Google or the layoffs at AT&T and Citigroup?

ALI VELSHI, CNN SENIOR BUSINESS CORRESPONDENT: Well, in the short term, the layoffs are more significant. That's almost 15,000 jobs in one day, Wolf. We have lost 200,000 jobs in this economy since January. At the end of the month, we will get the report from March. It's going to be a serious loss.

Now, Google is a great story of the future. It continues to grow. It's making real money. And that company reported strong earnings. So, the bottom line is, we're in a downturn. Downturns don't last forever. It might last eight or 10 months. And then jobs will start.

So, Google is definitely the story of the future. But, for the next -- for the course of the next few months, we're probably going to see a lot of job losses, and a lot of those in the financial sector. So, that's bad news.

BLITZER: What about Oil? It's now trading at, what, $117 a barrel? Where is that big barrel behind you?

(CROSSTALK)

VELSHI: You know, I can't keep up.

BLITZER: One hundred and seventeen dollars a barrel.

(CROSSTALK)

VELSHI: I can't...

BLITZER: I guess the fallout on inflation and -- and prices, it's going to be enormous down the road, isn't it?

VELSHI: Yes. We have talked a lot about oil, Wolf, in the past. How many years ago have we talked about oil hitting $50 and 460 and $70. One hundred and seventeen dollars, it inconceivable.

And it works right into the price of gasoline. We're already at $3.45 a gallon national average. There are a lot of people who said it will be $3.50 or $3.75 by Memorial Day. That looks very realistic.

But, fundamentally, Wolf, it's not just about gas prices. Oil works into everything, diesel on farms, diesel that goes into the trucks that transport our -- our food and our goods all over the place. So, this is bad news in the short term. Don't know when this ends, because it just keep racking further and further higher. Nobody has predicted this kind of price for oil.

BLITZER: In some parts of the country, it's close to $4 a gallon.

VELSHI: Yes.

BLITZER: And, at some gas stations, it's even more than $4 for unleaded. All right, Ali, thanks very much.

(CROSSTALK)

BLITZER: Ali Velshi doing some good reporting for us, as he always does.

In our "Strategy Session": Hillary Clinton calls Barack Obama's toughness into question.

(BEGIN VIDEO CLIP)

H. CLINTON: Having been in the White House for eight years and seeing what happens in terms of the pressures and the stresses on a president, that was nothing.

(END VIDEO CLIP)

BLITZER: So, is Senator Obama tough enough for the Oval Office? And what about Senator Clinton?

And we know all about John McCain's finances, but what about his wife's? Does the public have a right to know about Cindy McCain's tax returns? All that and more coming up in our "Strategy Session" -- right here in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: In today's "Strategy Session," let's get some more now about the bitter reaction to the Hillary Clinton-Barack Obama debate earlier in the week. As we just mentioned, some people say that debate was fair. Others say it was targeted against Obama.

Listen to what the candidates themselves say about it.

(BEGIN VIDEO CLIP)

H. CLINTON: Well, I know that some of my opponent's supporters and my opponent are kind of complaining about the hard questions.

(LAUGHTER)

H. CLINTON: Well, having been in the White House for eight years and seeing what happens in terms of the pressures and the stresses on a president, that was nothing.

OBAMA: I understand it. And, when you're running for the presidency, then you have got to expect it. And, you know, you have just got to kind of let it...

(CHEERING AND APPLAUSE)

OBAMA: You know. You know.

(CHEERING AND APPLAUSE)

OBAMA: It's what you have got to do.

(CHEERING AND APPLAUSE)

(END VIDEO CLIP)

BLITZER: All right. Let's discuss this in our "Strategy Session."

Joining us now, the Democratic strategist Peter Fenn and the Republican strategist Kevin Madden.

Guys, thanks to both of you for coming in.

So, what do you think? Is Obama tough enough to handle this kind of tough questioning?

PETER FENN, DEMOCRATIC STRATEGIST: I certainly think they're both tough enough, Wolf. I think we're talking about alligator skin here with both of these folks.

You know, but it's funny. One complains about always getting the first question. That was Hillary's a couple months ago. He says, hey, wait a minute, 45 minutes, no issues are discussed. There's a lot of back and forth.

But this is -- this has been tiddlywinks so far in this Democratic primary. It's going to -- it's going to get real tough as we move along.

BLITZER: It's small potatoes. Whoever gets the Democratic nomination, they should expect a whole lot worse in a general campaign, don't you think?

KEVIN MADDEN, FORMER ROMNEY CAMPAIGN NATIONAL PRESS SECRETARY: Oh, absolutely.

I mean, we were joking around before. We were saying, there's no crying in baseball. And this is one of those -- this is one of those instances. When you run for president, you're actually asking for the right to be humiliated. And that is -- that is an odd thing.

But very oftentimes, in debates like this, where they get tough, you get very tough questions, you're constantly probed and being hammered about by the media, you can actually come out, you know, above, looking very presidential, if you stand by those attacks and you come out ahead of them. So...

BLITZER: If you want to be president -- Kevin is absolutely right -- you have to expect that everything is almost fair game, almost every part of your life, and, certainly, you know, any finances or anything like that.

FENN: Absolutely.

I mean, the Clintons went through this for eight years. Obama is getting a taste of it now. He understands it. Look, he's a tough guy out there on the basketball court. He will be a tough guy in a campaign. So, I think more of it, Wolf, was -- the complaining was about the lack of substantive questions in the first 45 minutes of that debate. That was part of the problem.

And, honestly, I mean, you're good at these. I would have mixed it up.

BLITZER: Yes.

FENN: I wouldn't have spent the whole first 45 minutes not talking about any substantive issues. That...

MADDEN: They also seemed to be tapping into a lot of what viewers felt was wrong with the debate...

FENN: Right.

MADDEN: ... and that frustration that there wasn't a lot of issues, and, instead, this was more about the miscues and the misstatements than it was about issues.

BLITZER: Yes. I think, if -- if they would have moved up some of the substantive policy questions early on, the criticism against Charlie Gibson and George Stephanopoulos probably would have been more muted. They could have asked all those other questions, but not necessarily right at the top of the -- the session. I don't know if you agree with that.

MADDEN: And George -- no, George conceded as much today in "The New York Times" story that was talking about this whole outcrying of -- of angst against -- against ABC.

BLITZER: Is it fair game for the press or the American public to have access to Cindy McCain's tax records? Because, today, John McCain released his tax records. They file separately. She is a very, very wealthy woman, say -- some suggesting worth perhaps $100 million.

But she's saying it's for privacy reasons. She doesn't want to release her tax records.

MADDEN: Look, Wolf, I think these are often taken on parallel tacks.

There's what the media is expecting as far as transparency and disclosure, and then there's what the public expects. When those two collide, it's going to become a problem for the McCain campaign. But I think, right now, the level of transparency that you're getting from the campaign, his personal assets being disclosed, his tax returns being disclosed, that is probably enough to keep the public satiated for how much money he's worth.

BLITZER: And he makes the point -- his people make the point that they have been married, what, 27 years, but they have filed separately all these years, and they did have a prenuptial agreement before they got married.

FENN: I will tell you, Wolf, but he hasn't been running for president of the United States for over 20 years.

And you have got to remember that, in 2004, the Republicans went absolutely ballistic on John Kerry and Teresa Heinz. Oh, what's she trying to hide? All that money. You know, you heard the folks going at them. Ed Gillespie just went crazy about it.

BLITZER: He was the chairman of the RNC.

FENN: Of the RNC at the time.

It does seem to me that, for someone who is Straight Talk Express, who says it's all about transparency, that he ought to try to convince his wife they ought to have all these investments, they ought to put forth the income tax returns.

Look, there's not that much -- if they have got nothing to hide, just go ahead and do it.

BLITZER: What do you think?

MADDEN: Well, I think that the McCain campaign, what their task is right now is to make sure that they put out enough information about the privacy of Cindy McCain's argument -- the privacy argument that Cindy McCain has, the fact that she is somebody who has business partners. This is a private company, that that sort of disclosure is not required.

And the fact that John McCain himself has gone out there and released his tax returns, that's above and beyond what the law requires, as far as disclosure.

BLITZER: But all the candidates released their tax returns.

MADDEN: Well, it's -- there's a precedent here for not releasing the spouse's tax returns. I know that the RNC probably did it in 2004. My guess is that the public doesn't remember that, though Peter is trying his best to remind them. FENN: We will continue to talk about double standards here.

(CROSSTALK)

BLITZER: And they say that, at some point fairly soon, they're going to release all of his medical records as well.

MADDEN: I expect that that is probably more of an interest to the public, given the fact that he has had health problems in the past, with the skin cancer bout -- a bout with skin cancer. That is probably much more relevant in this debate about disclosure than I think Cindy McCain's tax returns.

BLITZER: And I think you agree the public does have a right to know about a presidential candidate's health?

FENN: Oh, absolutely. It's critical, I think, especially with someone who's 71-years-old, going to be 72 if he gets elected president of the United States. They ought to know everything there is to know about his medical history.

BLITZER: Peter Fenn, Kevin Madden, guys, thanks for coming in.

(CROSSTALK)

MADDEN: Thanks, Wolf.

BLITZER: The pope is about to make history once again. You're going to be looking right now at a live picture at the Park East Synagogue in New York City, where Pope Benedict is expected to arrive in less than half-an-hour.

And, later, former President Jimmy Carter faces an avalanche of outrage over his meeting with Hamas leaders. Some lawmakers want Carter to pay a price. We will tell you what it is -- right here in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: Let's take a look at some of the "Hot Shots" coming in from our friends over at the "Associated Press," pictures involving Pope Benedict's -- Benedict XVI's visit to New York.

At JFK Airport, a color guard stands in position as a worker vacuums the red carpet for the pope's arrival.

At the United Nations, the pope greets the United Nations International School Choir.

At the U.N. General Assembly hall, delegates snap photos of the pope on their camera phones.

Also at the U.N., the pope touches a flag that flowed over the United Nations headquarters in Baghdad when a truck bomb killed 17 people -- some of this hour's "Hot Shots," pictures often worth 1,000 words. On our political ticker today, the funnyman Stephen Colbert let Hillary Clinton deliver a big punchline during a broadcast from Pennsylvania. Colbert jokingly complained that no one was around to fix a giant monitor behind him. Then, suddenly, Senator Clinton strolled in and declared she could fix the mess just in time for Barack Obama to appear on the program via satellite.

Listen to this.

(BEGIN VIDEO CLIP, "THE COLBERT REPORT")

H. CLINTON: How are you feeding this?

(LAUGHTER)

H. CLINTON: Through the router or aux bus on the switcher?

(LAUGHTER)

STEPHEN COLBERT, HOST, "THE COLBERT REPORT": It's an aux.

CLINTON: Try toggling the input.

(LAUGHTER)

COLBERT: OK.

(MUSIC)

(CHEERING AND APPLAUSE)

COLBERT: Holy cow!

Senator Obama, won't Senator Clinton be happy that she fixed our screen?

(CHEERING AND APPLAUSE)

(LAUGHTER)

(CHEERING AND APPLAUSE)

OBAMA: I'm sure she will, Stephen. I'm sure she will.

(END VIDEO CLIP)

BLITZER: Colbert also interviewed the former presidential candidate John Edwards, who yet to endorse either Clinton or Obama.

(BEGIN VIDEO CLIP, "THE COLBERT REPORT")

JOHN EDWARDS (D), FORMER PRESIDENTIAL CANDIDATE: You know, Stephen, you're right about white males playing an important role in this election. Their votes are being courted as a Democratic tiebreaker between these two candidates. And no white male's vote is being courted more vigorously than this one. (LAUGHTER)

(CHEERING AND APPLAUSE)

(END VIDEO CLIP)

BLITZER: Very funny stuff, indeed.

Remember, for the latest political news any time, you can always check out CNNPolitics.com. That's where I write my daily blog post as well. Posted one just before the show, as I try to do every single day.

Jack Cafferty is joining us now with "The Cafferty File."

CAFFERTY: I didn't get a chance to read it yet. Did you write about meeting the pope?

BLITZER: I -- I did. I did. I promised our viewers yesterday I would write a few words.

And we also attached the video of when John King debriefed me yesterday on what it was like when I emerged from that meeting. I got to tell you, it was very exciting.

CAFFERTY: Yes, we could tell you were excited. That was good stuff.

All right, the question this hour is: In this last weekend before the Pennsylvania primary, what do Barack Obama, Hillary Clinton have to do to win over late undecided voters?

V.J., Oswego, Illinois: "If there are still undecided voters out there, they have probably voted for the wrong candidate all their lives. So, do all of us a favor. Stay undecided until next January, and let the rest of us make the decision for you."

(LAUGHTER)

CAFFERTY: "Most of us made up our minds about 19 debates ago, long before the gun-shooting, shot-tossing, bitter-beer drinking, fiery-word preaching, and gutter-ball rolling started.

Sue in Indiana: "I'm not sure either one can win over the undecideds at this point. With Clinton's negativity and untruthfulness and the perception of the Obama 'bitter' remarks, the people who haven't made up their minds yet might just stay home, and that would not be good for Hillary Clinton."

Jenny in Georgia writes: "Keep Bill and the preacher on short leashes."

Deb in Pennsylvania: "I am a 53-year-old white woman from Lebanon, Pennsylvania, a blue-collar town in the central part of the state. I own a hand gun and hunt. I would like to see Obama win here. He needs to stay in the state from now through the primary and stay on message. When people meet him, they like him. That's how he can win Pennsylvania."

Bob in Pittsburgh: "How can anyone still be undecided? Don't they read the papers, check the Internet, listen to TV, talk to their friends? Anybody who is undecided at this point shouldn't be allowed to vote."

I actually agree with that position.

Angela says: "Cry."

Bryan writes: "If either were to simply shut up for a few days, that might sway a few of those undecideds, as it would be a sign of change we could all get behind."

And Andrew in Illinois: "Jack, it is quite simple, really. They need to have Cheney's joke-writers put something together for their next speech. If they can make Cheney look human, let alone funny, they could work wonders for Barack or Hillary."

If you didn't see your e-mail here, you can go to my blog at CNN.com/caffertyfile. And if you will scroll the prompter up, I will read the rest of this. Oh, yes, there it is -- where you can look for your letter, along with hundreds of others.

Wake that guy up running the prompter, Wolf.

BLITZER: All right.

CAFFERTY: The show doesn't end until 7:00 tonight.

(LAUGHTER)

BLITZER: Jack, thank you for that.

And, to our viewers, you're in THE SITUATION ROOM.

Happening now, a landmark speech and a historic visit. Pope Benedict XVI is now in New York City on the final leg of his historic U.S. trip. We're going to show you what he's doing that no pontiff has ever done before here in the United States.

Also, billions of dollars sent to Pakistan to help find Osama bin Laden -- irate lawmakers are now asking, what is there to show for all that money? Now an unsettling answer in a scathing government report.

And four days before the Pennsylvania primary, a new tactic designed to help Hillary Clinton against Barack Obama may be helping John McCain the most.

I'm Wolf Blitzer. You're in THE SITUATION ROOM.