Return to Transcripts main page

THE SITUATION ROOM

New Confidence Builder in Chief; Bailing Out Consumers; Your Patience With Obama

Aired November 25, 2008 - 16:00   ET

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


MILES O'BRIEN, CNN ANCHOR: Happening now, Barack Obama grabs the role of economic confidence-builder-in-chief. But the Bush team is still trying to show it is still hard at work by funneling billions to consumers.
Plus, great expectations for the president-elect. Are Americans investing too much hope in a quick financial fix?

And Sarah Palin to the rescue? The former VP candidate is keeping her profile high by getting involved in an undecided Senate race.

Wolf Blitzer is off. I'm Miles O'Brien.

You are in THE SITUATION ROOM.

This hour, stock prices level off after a huge two-day rally. The Dow Jones industrials closing up just about 36 points a moment ago.

President-elect Obama is doing his part today to try to boost investor and consumer confidence. For a second straight day he announced members of his economic fix-it team and promised Americans that help is on the way.

We begin with our White House Correspondent Ed Henry, covering the transition in Chicago. An official and unofficial message from Obama today. Tell us about that, Ed.

ED HENRY, CNN WHITE HOUSE CORRESPONDENT: Well, that's right, Miles, the official message from the president-elect is he's trying to show he'll be ready to hit the ground running next January 20th. The unofficial message, he's trying to give the markets a boost in the arm right now.

(BEGIN VIDEOTAPE)

HENRY (voice-over): There's a leadership vacuum, and President- elect Barack Obama is trying to fill it. Sort of.

SEN. BARACK OBAMA (D-IL), PRESIDENT-ELECT: There is only one president at a time. Given the extraordinary circumstances that we find ourselves in, however, I think it is very important for the American people to understand that we are putting together a first class team. HENRY: A careful calibration. Mr. Obama gets credit for stepping up, while leaving the actual responsibility for the crisis on the lame-duck president's shoulders. Plus, he gets more breathing space before giving details of his economic stimulus plan, or how he plans to cut the budge to pay for a package that may cost $700 billion.

OBAMA: We are going to go through our federal budget, as I promised during the campaign, page by page, line by line, and eliminating those programs we don't need.

HENRY: Mr. Obama talked about sacrifice as he unveiled congressional budget expert Peter Orszag as the new White House budget director and former Clinton official Robert Nabors as deputy budget director. But the president-elect did not name one major budget item he'd cut, and reporters who were called on didn't press him on it.

OBAMA: Peter? Where's Peter? I didn't recognize you because you don't have the floppy hat you had during the campaign.

UNIDENTIFIED MALE: I actually do.

OBAMA: There it is. And that's what I'm talking about.

HENRY: After the jocularity, Mr. Obama was asked what kind of mandate he has.

OBAMA: I don't think that there's any question that we have a mandate to move the country in a new direction, but I won 53 percent of the vote. That means 46 or 47 percent of the country voted for John McCain.

(END VIDEOTAPE)

HENRY: Now, the president-elect said, to him, this means that, despite Democratic gains, he still has to work with Republicans on Capitol Hill to pass his economic agenda. I can tell you, Republicans on the Hill are already saying one place to start would be for the president-elect to start giving them some details about his economic plans -- Miles.

O'BRIEN: Everyone wants details, including you, Ed. All right. Ed Henry in Chicago. Thank you very much.

President Bush's economic team is trying to shoot down the notion that there's an absence of leadership right now. Treasury Secretary Henry Paulson today announced a new $800 billion plan designed to put cash in consumers' hands. Another $800 billion.

CNN's Elaine Quijano is at the White House. Elaine, yet another bailout?

ELAINE QUIJANO, CNN WHITE HOUSE CORRESPONDENT: Well, you know, Miles, it's interesting. Some experts say the difference this time is a very targeted focus on consumers and small businesses.

(BEGIN VIDEOTAPE)

QUIJANO (voice-over): It's the government's latest attempt to get banks to start lending money again, $800 billion in treasury and Federal Reserve programs aimed at making it easier for consumers to get cheaper mortgages, credit card rates, and student and car loans.

HENRY PAULSON, U.S TREASURY SECRETARY: This lack of affordable consumer credit undermines consumer spending, and as a result weakens our economy.

QUIJANO: Treasury Secretary Henry Paulson announced the move amid more bleak news that, the U.S. economy shrank by half a percent during the months of July, August and September. That's the biggest drop in seven years. Secretary Paulson says that figure underscores how what's happening in the financial system is bleeding out into the larger economy, and why, he argues, banks must lend to trigger consumer spending.

PAULSON: As the economy is turning down, it is very important that lending continue to be available, and be available to consumers.

QUIJANO: But there are no guarantees the strategy will work, and some say could even lead to the same problem of consumers snapping up loans they can't afford.

PAUL LA MONICA, EDITOR-AT-LARGE, CNNMONEY.COM: The hope is that they just at least start lending to people that deserve the loans, not necessarily to everyone so that we have a repeat scenario of what happened the past few years.

(END VIDEOTAPE)

QUIJANO: Now, another open question, how long will it take to get the programs up and running? And will Treasury Secretary Henry Paulson's successor, Tim Geithner, actually continue with the approach?

Well, it's interesting. This afternoon at the Treasury Department, around 2:00 this afternoon, Secretary Paulson did sit down for a meeting with his successor, Tim Geithner. Now, there's no word yet on what the two men discussed, but clearly the Treasury Department, releasing this photo of the two men in that meeting, really is designed to underscore the message that Secretary Paulson gave today at the news conference, and that is that the incoming and the outgoing administrations are working very closely together on the approach, on the current crisis, on the longer-term, perhaps, strategy. Clearly trying to calm jittery investors' nerves -- Miles.

O'BRIEN: Elaine Quijano at the White House. Thank you very much.

What a transition period. Really amazing.

Time now for "The Cafferty File." Jack is here with us. It's just incredible, isn't it?

JACK CAFFERTY, CNN ANCHOR: Some Russian expert on all of this is predicting that not only will this country go broke, but it's going to break up into five separate nations in the years ahead.

O'BRIEN: Wow. Stay tuned for that.

CAFFERTY: Yes.

Barack Obama's looking downright presidential these days. He's held two news conferences in two days, unveiled his team of economic advisers. He's acting presidential as well.

As our Gloria Borger writes on CNN.com, "Not only is there a team, but there's also a plan." Borger says that Barack Obama's taking ownership of the financial crisis. He's ready to tackle it, even though he has about two more months to wait before he actually becomes president. Obama is placing high priority on passing a second stimulus package, probably a lot bigger than the first one, to try to jump-start the economy.

It's interesting to recall during the primaries, Hillary Clinton derided Barack Obama as not being ready for the job of president. Remember? She claimed that while she had years of experience that qualified her to be ready on day one, Obama had only a speech to bring to the office of the president. Then after Obama whipped her and won the nomination, his Republican opponent, John McCain, picked up Clinton's mantra, saying that Obama had no experience, couldn't possibly be ready to assume the highest office in the land.

Well, with about eight weeks to go until his inauguration as president, Barack Obama is making both McCain and Clinton look a little silly.

Here is the question: Is it a mistake for Barack Obama to take ownership of the financial crisis more than two months before he actually becomes president?

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

The Russian guy says there'll be the East Coast, the West Coast, the northern states, the southern states, and the Midwest. Five separate countries.

O'BRIEN: That would be interesting.

CAFFERTY: Where would you like to live?

O'BRIEN: I don't know.

CAFFERTY: I don't know.

O'BRIEN: All right. Thank you very much, Jack.

CAFFERTY: Sure.

O'BRIEN: See you in just a little bit.

Sarah Palin is taking another shot at helping Republicans claim victory. Does she have the mojo to make a difference in a final Senate showdown?

Plus, the pros and cons of keeping Robert Gates in charge at the Pentagon, why some insiders think it's a bad idea.

And President-elect Obama gets reporters to play ball and then apologizes.

You are in THE SITUATION ROOM.

(COMMERCIAL BREAK)

O'BRIEN: Many of you may be long on enthusiasm for Barack Obama's history-making election, but may be short on something he's asking for. And that is patience, regarding the economy, of course.

Let's bring in CNN Senior Political Analyst Bill Schneider. How much time will voters give the president to turn things around, Bill?

WILLIAM SCHNEIDER, CNN SR. POLITICAL ANALYST: Well, Miles, Americans are pretty realistic, and believe it or not, they're getting more realistic.

(BEGIN VIDEOTAPE)

SCHNEIDER (voice-over): President-elect Obama is encouraging people to be realistic.

OBAMA: We are facing an economic crisis of historic proportions.

SCHNEIDER: No quick fix.

OBAMA: The economy's likely to get worse before it gets better. Full recovery will not happen immediately.

RONALD REAGAN, FORMER PRESIDENT OF THE UNITED STATES OF AMERICA: I, Ronald Reagan...

SCHNEIDER: He might be guided by President Ronald Reagan's experience. No sooner did Reagan take office than the economy began to get a lot worse. Unemployment jumped to over 10 percent, the highest level since the 1930s. It's about 6.5 percent now.

By 1982, voters were getting anxious. Republicans lost 26 House seats in the midterm election. President Reagan's response? Stay the course.

REAGAN: We can do it, my fellow Americans, by staying the course.

SCHNEIDER: A lot of voters stuck with Reagan because he had defined a course. By 1984, their confidence paid off.

REAGAN (voice-over): It's morning again in America. Today, more men and women will go to work than ever about ever in our country's history.

SCHNEIDER: President-elect Obama seems to be channeling Reagan's optimism.

OBAMA: ... to summon that spirit of determination and optimism that has always defined us.

SCHNEIDER: More important, Obama has to rally the public behind his plan.

OBAMA: There's consensus that that requires a bold plan to make the investments in the future.

SCHNEIDER: A president can't ask people to stay the course unless they're confident that he has defined a course. When do they expect things to turn around? More than three-quarters expect things to be better four years from now. That's when they expect to see morning again.

(END VIDEOTAPE)

SCHNEIDER: Well, in an ABC News poll taken just before the election, 50 percent of likely voters thought Obama would be able to do a lot to improve the economy, and now 44 percent feel that way. With the magnitude of the economic crisis sinking in, the public may be giving the new president some breathing room -- Miles.

O'BRIEN: Bill Schneider, thank you very much.

Meanwhile, amid the guessing game of who Obama will pick or pass over for his cabinet, one name just keeps coming up, Robert Gates. Some people wonder why the defense secretary should stay, but others wonder why not.

Here's Senior Pentagon Correspondent Jamie McIntyre.

(BEGIN VIDEOTAPE)

JAMIE MCINTYRE, CNN SR. PENTAGON CORRESPONDENT (voice-over): The appeal of Robert Gates is obvious. He's probably the most admired member of the Bush cabinet, winning plaudits for his pragmatic approach and willingness to hold people accountable. So the argument goes, keeping Gates during a time of two wars ensures continuity, demonstrates bipartisanship, and conveys that President-elect Obama has the confidence in his own leadership to keep a talented Bush holdover.

But the flipside of keeping Gates includes potential policy conflicts over things like funding missile defense and the speed of an Iraq pullout. And Gates' lame-duck status could make it harder to hire qualified deputies, which in turn delays much-needed change, which after all is what Barack Obama ran on.

DOV ZACKHEIM, FMR. PENTAGON COMPTROLLER: If we don't have good civilian personnel alongside our good military personnel, we're not going to reform. It can't happen. You need the people to make it work.

MCINTYRE: And right now, one big problem is that the system for buying new weapons is broken. From the bungled Air Force tanker deal, new presidential helicopters, to the Navy's latest high-tech ships, almost every acquisition program is plagued by cost overruns and poor performance.

LAWRENCE KORB, CENTER FOR AMERICAN PROGRESS: For example, between 2001 and 2008, the weapons development programs increased by $400 billion because nobody was paying attention. People went to jail because the acquisition process wasn't managed with the tankers.

(END VIDEOTAPE)

MCINTYRE: Up to now, Gates has had the luxury of focusing on his most immediate problem, the war in Iraq. But if he stays -- and a lot of people say that's where the smart money is -- he's going to have to focus on a lot bigger problems, the whole Pentagon bureaucracy, something he's had the luxury of ignoring pretty much until now -- Miles.

O'BRIEN: Jamie McIntyre at the Pentagon. Thank you very much.

In the midst of all the transition hoopla, Senator John McCain is reminding all of us that he's still around and still speaking out. The failed presidential candidate held a news conference today in Phoenix. He sang the praises of Arizona's Democratic governor, Janet Napolitano, President-elect Obama's expected choice as homeland security secretary. He predicted her likely nomination would sail through the Senate.

McCain spoke highly of his former running mate, Sarah Palin, despite widely rumored tensions between his and her camp.

(BEGIN VIDEO CLIP)

SEN. JOHN MCCAIN (R), ARIZONA: I think she's -- did a great job of energizing our base. I'm very proud of her. It's one of the great pleasures I've had, to get to know her and her family. And I think she has a very bright future in leadership position in the Republican Party, and I'm still extremely proud of the fact that she agreed to be my running mate.

(END VIDEO CLIP)

O'BRIEN: We'll talk about Governor Palin's next big political test just days from now. That's ahead in our "Strategy Session."

Barack Obama says he has it, and now it's time to spend it, something both he and President Bush before him said they earned in their elections. But how might Obama use his political capital differently than President Bush?

A sort of jigsaw puzzle needs a few more pieces before it's complete, the picture of the Obama administration. The latest on who's in it and who's not.

And fears that a small plane could crash. Find out how this terrifying scene ended. (NEWSBREAK)

(COMMERCIAL BREAK)

O'BRIEN: You're in THE SITUATION ROOM.

Happening now, with the economy in crisis, who is in charge? Barack Obama is assembling his team and working on a recovery plan, but he's not in office just yet, as you know.

Banks at risk. More are joining the troubled list, prompting some sweeping suggestion for a fix that could go beyond bailouts. Far beyond.

And serving at the White House, literally. While administrations come and go, the White House chef offers some continuity.

Wolf Blitzer is off today. I'm Miles O'Brien. You are in THE SITUATION ROOM.

Barack Obama does something he has not done since the election. As we mentioned, he held a second news conference on back-to-back days. Today he announced more additions to his economic team. Peter Orszag has been picked to head the Office of Management and Budget. Rob Nabors to be Orszag's deputy there.

But just before the president-elect took questions, he wanted to set one thing straight.

(BEGIN VIDEO CLIP)

OBAMA: Now, let me be clear. These appointments, as well as the appointments that I announced yesterday, are not the sum of my economic team. These appointments are going to work closely with those that I have not yet announced.

Those include the secretaries of energy and labor, commerce, and health and human services, as well as others in my administration, to design a recovery path for both Wall Street and Main Street, and to put our economy on a path to long-term growth and prosperity. Because at this moment, we must not only restore confidence in our markets, we also must restore the confidence of middle class families that their government is on their side, that it's working for them, and on their behalf, to meet their families' needs. That's what I intend to do as president of the United States.

With that, I'm going to take a few questions, and I'm going to start with Savannah.

UNIDENTIFIED FEMALE: Thank you, sir.

Is this a greater degree of public involvement in the economy than you -- sooner than you had originally planned? And if so, how do you square it with your reminder to us that there is only one president at a time? OBAMA: Well, there is only one president at a time. That president is George W. Bush, and he will be president until I'm sworn in on January 20th.

Given the extraordinary circumstances that we find ourselves in, however, I think it is very important for the American people to understand that we are putting together a first-class team, and for them to have clarity that we don't intend to stumble into the next administration. We are going to hit the ground running. We're going to have clear plans of action.

We intend to have the kind of economic recovery plan that is going to put 2.5 million people into jobs. We're going to make sure that we start focusing on energy, on health care, on revamping our education system so that it's competitive in the 21st century. And, as I'm talking about today, that we are not going back to business as usual when it comes to our budget.

I mean, one of the concerns that people may have is, you've got this large stimulus package that the new president is proposing and members of Congress are talking about. Is this going to be more of the same when it comes to Washington spending? And the answer, I want to be very clear, is no.

We are going to have to jump-start the economy, and there's consensus that that requires a bold plan to make the investments in the future. But we have to make sure that those investments are wise. We have to make sure that we're not wasting money in every area.

If there is -- if we're talking about health care, we want to put money into health care modernization that can help us save money over the long term. We don't want to continue programs that aren't working and making people healthier.

The same is true for education. The same is true in the Defense Department. The same is true in social spending.

So the fact that Rob and Peter are here today indicates the seriousness with which we're taking this. And I think it's important, given the uncertainty in the markets, and given the very legitimate anxiety that the American people are feeling, that they know that their new president has a plan and is going to act swiftly and boldly.

OK. Peter? -- Where's Peter? I didn't recognize you because you don't have the floppy hat that you had during the campaign.

QUESTION: I actually do.

OBAMA: There it is.

(LAUGHTER)

OBAMA: Man, that's what I'm talking about.

QUESTION: Thank you, Mr. President-elect. Given the election results, what sort of mandate do you have from the voters, do you believe? And does a large Democratic majority in Congress present an opportunity to pass your agenda or is there a danger in this environment of overreach?

OBAMA: Well, first of all, we had, I think, a decisive win because of the extraordinary desire for change on the part of the American people.

OBAMA: And so I don't think that there's any question that we have a mandate to move the country in a new direction and not continue the same, old practices that have gotten us into the fix that we're in.

But I won 53 percent of the vote. That means 46 percent or 47 percent of the country voted for John McCain.

And it's important, as I said on election night, that we enter into the new administration with a sense of humility and a recognition that wisdom is not the monopoly of any one party.

In order for us to be effective, given the scope and the scale of the challenges that we face, Republicans and Democrats are going to have to work together.

And I think what the American people want more than anything is just commonsense, smart government. They don't want ideology; they don't want bickering; they don't want sniping. They want action, and they want effectiveness. And that's what Peter and Rob are going to help us provide.

When it comes to our budget, I think people don't want to continue a budget -- an argument about big government or small government. They want smart government and effective government.

And so what we're going to do is to work as closely as we can with the Republican Party. My chief of staff, Rahm Emanuel, has already met with both caucuses. We want their input; we want their ideas.

One of the things I'm very pleased about is I think that we're already seeing bipartisan accolades for the budget team that I'm putting together, because they recognize these are serious guys who are going to be honest about the budget challenges that we face.

That's the kind of approach that I want. That's what I think the American people are looking for.

(END VIDEO CLIP)

O'BRIEN: Let's take a look at who is on and who could be on the Obama team.

Rahm Emanuel, the Illinois congressman, will be chief of staff. You know that. Hillary Clinton is said to be on track for secretary of state. In terms of Cabinet secretaries, we're hearing about New York Federal Reserve president Timothy Geithner as Obama's pick for Treasury, former Senate Majority Leader Tom Daschle health and human services secretary, former Deputy Attorney General in the Clinton administration Eric Holder Justice Department. And Arizona Governor Janet Napolitano is said to be the pick for homeland security secretary.

Meanwhile, there are other Cabinet posts yet to be filled. One is education secretary. That post poses many problems. Here's Jason Carroll with that.

(BEGIN VIDEOTAPE)

JASON CARROLL, CNN CORRESPONDENT (voice-over): Mr. President, before you hear from the experts how to improve education, listen to what New York City public high school students have to say.

UNIDENTIFIED FEMALE: President Obama, I think that the security needs to be better in the schools.

UNIDENTIFIED MALE: I think we need more teachers.

UNIDENTIFIED MALE: We don't get as much funding, and that lead to, like, bad students coming to our school.

CARROLL: Lack of funding, overcrowded classrooms, that's just for starters.

PEDRO NOGUERA, EDUCATION PROFESSOR, NEW YORK UNIVERSITY STEINHARDT SCHOOL: It's a big mess, because the -- our economic crisis is directly related to our educational challenges.

CARROLL: Education experts say, three areas need immediate attention: early education -- a dozen states still don't fund preschool -- college costs -- one survey found 66 percent of adults say tuition is too much -- and what to do about the No Child Left Behind program.

JOSEPH VITERITTI, PROFESSOR OF PUBLIC POLICY, HUNTER COLLEGE: It's the big elephant in the room. Politically, people don't know what to do with it.

CARROLL: It is the Bush initiative requiring schools to test students annually in reading and math. Under the law, all children must be proficient in those subjects by 2014, or their schools face sanctions. The problem? Too many schools aren't on schedule.

And a recent study shows, students haven't improved much in reading since the program started.

MICHAEL PETRILLI, THOMAS B. FORDHAM INSTITUTE: If we do not make investments and make reforms to our system, we're going to get to the point where we simply cannot compete with other countries.

CARROLL: In education, U.S. students rank 18th among 36 nations.

Experts argue over the value of accountability through testing, but few debate the need for more money. A new study show, two-thirds of school administrators say their districts are inadequately funded and are forced to cut back anywhere they can.

JUDITH JOHNSON, SUPERINTENDENT, PEEKSKILL CITY, NEW YORK, SCHOOLS: Keep it going.

CARROLL: Superintendent Judith Johnson may cut staff, but says, for other schools, nothing's off-limits, even kindergarten.

JOHNSON: Kindergarten is an integral part of a public education system. Guys, kindergarten could go.

CARROLL (on camera): Well, so much for early education. Bottom line, even though the country is dealing with two wars and an economic crisis, education is not something this country can afford to put on the back burner.

Jason Carroll, CNN, New York.

(END VIDEOTAPE)

O'BRIEN: Michelle Obama's tenure as first lady could mean the end of some long-held stereotypes about black women.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: You still have that -- that negative image of black women being overweight, and very loud, and rolling their eyes, and talking back, and having these sassy one-liners all the time. And that's just not the entire community.

(END VIDEO CLIP)

O'BRIEN: Ahead: a new face and a new role model at the White House.

Plus, Sarah Palin is bringing her style of hockey-mom politics down South. Can she seal a GOP victory in Georgia's Senate runoff? Donna Brazile and Jerry -- Terry Jeffrey are standing by for our "Strategy Session."

And a real-life pirate confesses to high-seas crimes, and shows no remorse -- a rare interview with an admitted pirate leader.

(COMMERCIAL BREAK)

O'BRIEN: Alaska Governor Sarah Palin will soon be back on the campaign trail, this time in Georgia. John McCain's former running mate will campaign for Republican Senator Saxby Chambliss. That's before a runoff election that pits Chambliss again Democrat Jim Martin.

Here for today's "Strategy Session," to talk about that and more, CNN political contributor Democratic strategist Donna Brazile, and conservative commentator Terry Jeffrey, editor in chief of the Cybercast News Service. Good to have you both with us. TERRY JEFFREY, EDITOR IN CHIEF, CYBERCAST NEWS SERVICE: Good to see you, Miles.

O'BRIEN: Terry, let's start with you.

Sarah Palin in Georgia, will that play well in Georgia?

JEFFREY: No doubt about it. You know, because this is a special runoff election, it's really all about getting out your vote. Each one of these candidates has to find a way to energize their people and get them to go out on a day when no one else is running for anything. And, quite frankly, I don't think there's anybody in the Republican Party who could do that better for Saxby Chambliss than Sarah Palin would.

O'BRIEN: But she's a bit of a divisive character, though, don't you think?

(LAUGHTER)

(CROSSTALK)

JEFFREY: I think she's a divisive character for the same reason she's going to drive out Republican vote, because liberals don't like her. And I think, on the margin...

(CROSSTALK)

O'BRIEN: Well, so, she could -- she could drive liberals to the polls, too, then, right?

(CROSSTALK)

JEFFREY: Well, I think it's possible, but, on the margin, I would rather be with Saxby Chambliss having her come out to drive my vote than worry about some liberals she might get out to vote.

O'BRIEN: Donna, what do you say?

DONNA BRAZILE, CNN POLITICAL ANALYST: Well, first of all, she might drive independents into Jim Martin's corner.

There's no question that this state is trending blue. If you look out on November 4, the Democrats here were able to pick up some down-ballot races all across the state. So, I think the political environment favors Jim Martin.

Sarah Palin will energize Democrats and independents. She will fire up Republicans. There's no question about it. But look at the returns on election night. There was 180,000 more votes for John McCain than Saxby Chambliss. So, there was a drop-off, about 8 percent. Half of those voters on the Democratic sides dropped off for Jim Martin over Barack Obama.

So, I think she has a big, high hurdle to cross and come down here and connect with home folks. O'BRIEN: All right. All right.

Let's move on. Let's talk about the Obama mandate today. I heard him at the news conference. It kind of struck me the way he described it. He said look, you know, the margin was close in the election, and, as a result, that leads him to some humility.

It stands in contrast, I think, to the way President Bush addressed reporters after the '06 election -- or '04 election. Let's -- let's listen.

(BEGIN VIDEO CLIP)

OBAMA: I won 53 percent of the vote. That means 46 percent or 47 percent of the country voted for John McCain.

And it's important, as I said on election night, that we enter into the new administration with a sense of humility.

(END VIDEO CLIP)

(BEGIN VIDEO CLIP)

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: I earned capital in the campaign, political capital. And now I intend to spend it.

(END VIDEO CLIP)

O'BRIEN: All right, Terry, little bit different tone there, wouldn't you say?

JEFFREY: Yes, I think so.

You know, I think President Bush and president-elect Obama both -- both won what were essentially close elections, and they're playing it exactly differently. I think Obama's being smarter about this, quite frankly. I think he's right.

Although -- you know, although I think he has a better position with a Democratic Congress than President Bush did, he's got to be very careful about what he does in these opening days of his -- in the opening days of his presidency, if he wants to be reelected, because if you drifts too far left, I think he's going to lose those independents Donna was talking about who came out and voted for him on November 4.

O'BRIEN: Well, let me ask you this.

(CROSSTALK)

BRAZILE: Well, Terry -- Terry is so worried about the left. And that's because the left has not been running this country.

Look at who's been running the country for the last eight years. The left has not driven this economy off the cliff, Terry. President- elect Obama is going to govern to strengthen the entire country. And he is going to set the right tone. He has already set the tone in his transition, that he wants the best people around him, and he wants to work with Republicans.

He has reached out. Now, it's up to Republicans to reach out to him. President Bush failed to do that after winning a very close election in 2004. And we're not going to talk about 200 today, clearly.

O'BRIEN: All right, let's talk about fund-raising for a moment. There was a report that came out from the nonpartisan Campaign Finance Institute that took a look at the Obama donations. We talked so much about all these small donations that the Obama campaign got. It turns the donation mix was pretty much the same as ever. Terry what, do you make of this?

JEFFREY: Well, I think the proportion may be the same, but I think what's truly astounding about what Obama did was the volume of money he raised. He raised more than $600 million. No one has ever done this before.

He had almost four million donors. Now, he did take contributions in the fall campaign, which Senator McCain did not, which makes his fund-raising a little bit different. But I guarantee, Republicans are going to be looking at the way that Barack Obama raised money, and they're going to try and emulate what he did. It really was a revolutionary thing in American politics, the way this guy was able to bring money into a presidential campaign.

O'BRIEN: Yes. Donna, what he did was Web 2.0, social networking, wasn't it?

BRAZILE: It was brilliant.

And, look, he -- he gave people a reason to open up their wallets before they were able to go to the polls. And he also gave people a great deal of inspiration. People who had never before given to a presidential campaign connected with president-elect Obama because they believe in his message of change. And that's ultimately what voters are going to still carry that message.

This was not just a campaign, miles. It was a movement. And movements will not end once the election ends. The movement will continue once president-elect Obama takes the oath of office.

JEFFREY: Miles, I...

(CROSSTALK)

O'BRIEN: All right, quick final word, Terry. Go ahead.

JEFFREY: I would just add this. He energized those people because he had a very liberal message in the campaign. He is presenting a very moderate image right now.

A lot of these folks might be disappointed if Obama heads in the direction he seems to be heading in, reaching out more to the center and to the Republicans. They want to see him govern to the left.

O'BRIEN: Well, it's interesting. The times may call for moderation. It will be interesting to see how that all goes down.

Terry Jeffrey...

BRAZILE: He wasn't liberal. He provided leadership to the country. That's not a label.

O'BRIEN: OK.

BRAZILE: That's a prescription for the future, Terry.

JEFFREY: Donna, I hope he doesn't fulfill a lot of those campaign promises.

O'BRIEN: All right, we have to invoke cloture.

(LAUGHTER)

O'BRIEN: Thank you very much.

Terry Jeffrey, Donna Brazile...

(CROSSTALK)

O'BRIEN: ... thank you very much.

The president-elect strikes out.

(BEGIN VIDEO CLIP)

OBAMA: I understand that, as a lifelong White Sox fan, you were placed in the Cubs section yesterday. And I want to apologize for that.

(END VIDEO CLIP)

O'BRIEN: It's the seating snafu that made waves in the Windy City. It's on our "Political Ticker."

And an extreme makeover idea for the financial system: What if the government created its own new banks?

(COMMERCIAL BREAK)

O'BRIEN: Michelle Obama is preparing to bring her unique style and substance to the White House. She's a multifaceted woman, but, for much of the world, one thing stands out. As America's first African-American first lady, Mrs. Obama may change the way many people view black women.

Here CNN's Randi Kaye.

(BEGIN VIDEOTAPE) RANDI KAYE, CNN CORRESPONDENT (voice-over): A high-powered professional, successful and the wife of the president-elect. Three good reasons why Michelle Obama may change the image of black women.

ALLISON SAMUELS, "NEWSWEEK": When you look at television, we're either, you know, single mothers with a bunch of children or drug addicts or street walkers.

KAYE: Allison Samuels wrote this article for "Newsweek." She hopes and expects having Michelle Obama in the White House will help put an end to the stereotyping of African-American women, often portrayed as overweight, ignorant and angry.

(BEGIN VIDEO CLIP)

EDDIE MURPHY, ACTOR: Don't adjust my seat. That scientifically proves that you were adjusting my seat.

(END VIDEO CLIP)

SAMUELS: We still have that negative image of black women being overweight and very loud and rolling their eyes and talking back and having these sassy one-liners all the time. And that's just not the entire community.

I think what Michelle Obama will be able to do is just show you a different type of African-American woman.

KAYE (on camera): During the campaign, Mrs. Obama was the victim of stereotyping, too. A television anchor, not from this network, referred to her as Barack Obama's "baby mama," a slang term often used to describe black women who have children out of wedlock. The anchor later apologized.

(voice-over): Mrs. Obama is a Harvard-educated lawyer who earned a six-figure salary before leaving her job to help her husband's campaign. With about 30 percent of African-American children being raised in poverty, that may register with black women.

OLIVIA FISHKIN, NEW YORK RESIDENT: The average African-American woman should take heed and hope that, with hard work and study, that they can also elevate themselves and aspire to become whatever they want to become.

KAYE: What about her skin color? It's much darker than African- American celebrities like Beyonce or Halle Berry. Samuels says that may send the message black is beautiful.

SAMUELS: In the African-American community beauty, a lot of times beauty is sort of determined by how light you are. And what I love about Michelle is that she's not that typical look.

KAYE: Michelle Obama's physique may also light a fire under black women. Federal statistics show four out of five African- American women are overweight or obese. Mrs. Obama works out daily, often before her girls are even awake. SAMUELS: You don't necessarily look at a size zero and go, "OK, I can look like that" in fashion magazines, but you have this real- life woman, who's a mother and a wife, who is making time to sort of work out and look good. And I think all of that is going to play a big role in African-American woman, you know, just sort of taking a step back and saying, "What can I do to be healthy?"

KAYE: So while Mrs. Obama may be focused on becoming mom in chief, as she likes to say, her role may be far greater than she will ever know.

Randi Kaye, CNN, New York.

(END VIDEOTAPE)

O'BRIEN: President-elect Obama had great success using the Internet to campaign. We talked about that just a moment ago. How will he take that into the White House, though?

Our Internet reporter, Abbi Tatton, is looking into how other countries use the Web to Govern. Abbi, what is going on overseas?

ABBI TATTON, CNN INTERNET REPORTER: Miles, in the United Kingdom, if Brits want to find their prime minister online, they have more and more options of how to do so, starting with YouTube, the official Downing Street channel.

There's Prime Minister Gordon Brown answering -- answering questions from the British people online. If you want something more informal, you can look for him on Twitter as well. There's an official channel there. The recent tweet that was posted a couple of weeks ago after an economic summit, chance meeting with Bill Clinton in a hotel corridor.

Now, if the British people also want to talk back, to add their own voice, they can do so, give Gordon Brown an earful at the Downing Street Web site. There's a section of the Web site which is dedicated to online petitions. If you have a problem with something the government is doing, you can create a petition. Tens of thousands of people can join you. And the government, if you get enough people, will -- will respond.

Over the last few years, more and more governments have been experimenting with online tools to communicate with their people around the world.

Going right across the world there to South Korea, there's a Web site there called epeople. If you have a gripe with any aspect of the government, you can put it there online, and the relevant agency has to respond to you.

Going across again now to Estonia, one of the Baltic states, where they have been doing Internet voting, they have got a portal called "Today, I Decide," where people can comment on legislation, then offer their own ideas as well for laws going ahead -- Miles.

O'BRIEN: Well, Abbi, what is next for the U.S., then?

TATTON: Well, some of this, we know already from the Barack -- president-elect Barack Obama. Some of it has started, in fact. The weekly radio address, that's already been put on YouTube. Members of his transition team have been posting online videos, as well. And we also know, from something Barack Obama has said in the past, that legislation, before he signs it, will be put online for a period of commentary -- Miles.

O'BRIEN: Abbi Tatton, thank you very much.

President-elect Obama gives reporters a change, but it's not the kind of change some baseball fans believe in. In these desperate economic times, why are some millionaires getting financial help from Uncle Sam?

(COMMERCIAL BREAK)

O'BRIEN: "Political Ticker" time.

It seemed like a good idea. Reporters covering the Obama news conference yesterday were seated in sections pegged to Windy City teams, White Sox on South Side, Cubs on the North Side. You get it, right?

Well, when the president-elect faced the media again today, he singled out one reporter, a fellow White Sox fan, for an apology.

(BEGIN VIDEO CLIP)

OBAMA: I'm going to call on Steve Thomma. Where's Steve? And the reason I'm going to call on Steve, I understand that, as a lifelong White Sox fan, you were placed in the Cubs section yesterday, and I want to apologize for that. This is also part of the new way of doing business. When we make mistakes, we admit them.

(END VIDEO CLIP)

O'BRIEN: Well, the country -- the country may be going south, but there's time for White Sox-Cubs rivalry there, right, Jack?

CAFFERTY: Well, it's nice there's some humanity in that place, for a change...

O'BRIEN: Yes, it's nice to have a little humor.

CAFFERTY: ... instead of, "I'm the decider; we're going to war."

I mean, there's little warmth. There's a heartbeat there.

(CROSSTALK)

CAFFERTY: The question this hour is: Is it a mistake for Barack Obama to take ownership of the financial crisis more than two months before he becomes president? Beverly in New York: "Someone has to show leadership. God knows it's has been lacking for eight years. Congress is on another break. Bush is on his third world goodbye tour. Since this mess will be inherited by Obama, why shouldn't he act to instill some market confidence? Who knows where we will be in 56 days if somebody does not get the economy in hand?"

Rian writes: "The history books tell us Hoover did nothing while a lame duck. Bush is very similar to Hoover. If Obama acting now helps us out, good."

Larry writes: "I am a big Obama fan, but I was surprised at how he is portraying himself in the media lately. He is speaking as though he is already president. There is a danger here. What if the economy does not improve by the time he becomes president, despite his plans? Will he be then starting out as a loser?"

April in New Jersey: "He might as well. Bush isn't."

David in California: "The American people need to begin regaining confidence. A soon-to-be-president who actively works to improve the economy is an important step in that direction, no matter what the political risk."

Bruce in Minnesota: "He may not have had the keys handed to him yet, but he owns it already. It's in his own interest to do what he can to stop the slide. If things get worse by January 20, he can't just say, no thanks, and go back to the Senate."

And J.D. in New Hampshire: "It's a shame Obama can't be sworn in this afternoon. The current occupant of the White House is permanently out to lunch, and has left us up the you-know-what creek without a paddle."

You know what creek he's talking about?

O'BRIEN: I think I do.

CAFFERTY: Of course you do.

(CROSSTALK)

O'BRIEN: Yes. We can say, because there's no FCC in cable. You can say that on cable, right?

CAFFERTY: Go ahead.

O'BRIEN: You go ahead.

(CROSSTALK)

CAFFERTY: No, you go first.

(CROSSTALK)

O'BRIEN: You go first. (LAUGHTER)

CAFFERTY: If you didn't see your e-mail here, you can go to my blog at CNN.com/caffertyfile. Look for yours there, among hundreds of others. I have four children. I have grandchildren. I need this gig.

O'BRIEN: Yes, we -- I need the gig, too.

(LAUGHTER)

O'BRIEN: But, you know, I think the lesson in all of this is, the presidency, a lot of the presidency is the bully pulpit, you know?

CAFFERTY: Well, it's -- it's even more than that. This guy -- this guy ran a pretty smooth campaign saying all the right things. He's starting to do some of the things he said. And that resonates a whole lot with -- with the public.

He will have some of these Republicans on board before it goes much farther.

O'BRIEN: Yes, people are sick of politics. They really are. They -- you know?

All right, Jack, we will see you in a bit.

CAFFERTY: Except Wolf.

(CROSSTALK)

O'BRIEN: No, that's different. You're in THE SITUATION ROOM.

Happening now: As the Bush administration makes a big move to free up billions for on consumers, Barack Obama beefs up his economic team and says they will be ready to take over on January 20. Are the two sides on the same page, though?