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Republican Saxby Chambliss Wins Georgia Senate Race; Automakers Submit Bailout Plans

Aired December 2, 2008 - 22:00   ET


ANDERSON COOPER, CNN ANCHOR: Tonight, breaking election news that could affect nearly every move the next president makes.
Also, Detroit carmakers laying out restructuring plans, cutting jobs, dealers, even the brands you grew up with, looking for taxpayer dollars, facing plunging sales.

And a chilling new terror report, all of that ahead tonight.

But we begin with the breaking news: CNN projecting Georgia Republican Saxby Chambliss has defeated challenger Jim Martin 59-41. Their Senate runoff election over, the totals just in. Democratic hopes for a 60-seat filibuster-proof supermajority are over.

CNN's Dana Bash is at Chambliss headquarters. She joins us now with the latest -- Dana.


As you just reported, Anderson, it does look like there's a very, very comfortable win here for the Republican incumbent, Senator Saxby Chambliss.

In fact, we're waiting for him to come out and speak to his supporters who are gathered here in Atlanta. And that should happen any minute from now. And I just -- I just want to put back up on the screen what we are seeing right now, in terms of those numbers, with 90 percent reporting, 59 percent for Saxby Chambliss and just 41 percent for the Democratic challenger, Jim Martin.

Now, what this means, big picture, is that the Republicans will not -- will have -- will have what Saxby Chambliss has been calling a firewall in Washington against Barack Obama's agenda, because it means that they won't -- Democrat won't get that 60-vote filibuster-proof majority.

And this really has been, Anderson, a wrenching, wrenching months for voters in Georgia, because, for most of the country, they were able to put the very long 2008 campaign behind them, but voters here, they have been bombarded with TV ads, negative TV ads, constantly. Millions of dollars have poured in here.

We have seen political celebrities, from Sarah Palin to Bill Clinton, coming down to campaign for candidates on both sides. And it's because of the national implications of this Senate race, because it very much was to affect the balance of power in Washington, and whether or not at least -- in terms of the hard numbers, whether or not Democrats would be able to stop Republicans from putting the brakes on some of the key agenda items that Barack Obama campaigned on.

It looks like, at least in terms of the numbers, Democrats won't be able to have that luxury right now in Washington -- Anderson.

COOPER: Dana, there is still this one Senate race outstanding in Minnesota.

BASH: There is. And it's interesting, because this was the last race of this election year where voters actually were going -- were going to the polls. It was an official runoff.

But what we're seeing in Minnesota is different. It's a recount. Voters are no longer actually going to the polls, but there has been a very long hand recount, a hand recount of almost three million ballots there in the state of Minnesota. And it's not -- it doesn't look like it's going to over any time soon.

The official recount is going to stop on Friday. But then there's a board that is going to possibly review some 5,000 ballots that are going to be challenged. That's not even going to be taken up until December 16. And then there could be legal battles. So, what that means is that that last Senate race in Minnesota, we might not know what happens in that for a very long time -- Anderson.

COOPER: All right, Dana Bash, thanks.

We are expecting Saxby Chambliss to make some comments, obviously accepting his victory tonight, celebrating it. We're going to bring you some of those comments when they happen.

Let's take a look, though, more on -- on how this changes the Senate balance of power across the board and how it affect a president's ability to get things done the way he wants them done.

John King joins us with more on that -- John.

JOHN KING, CNN CHIEF NATIONAL CORRESPONDENT: Well, Anderson, at best, as Dana just noted, the Democrats will have 59 seats in the Senate, if they win that contested Minnesota race still outstanding.

So, Democrats will not get, by simple math anyway, the 60-vote supermajority that would prevent -- would allow them to block any Republican filibusters.

But let's be closer to reality, in the sense that, if you look at the election vote, there's what you have, 58-41. Saxby Chambliss wins tonight 58-41, the one race outstanding. But, in all effects and purpose, when it comes to reality, Saxby Chambliss is from a conservative Georgia, a red state that John McCain won.

Had he lost tonight, we would have a major national story. You would have the collapse of the Republican Party. What you get now is a reinforcement of the Republicans as a conservative Southern party. But the moderate Republican senators, Olympia Snowe, Susan Collins of Maine, for example, likely to vote with the Democrats on many, if not most, issues.

If you're a Republican like George Voinovich from Ohio, Barack Obama just won your state, you're likely to at least try to cooperate with the Democratic president on most, not all, but most issues.

If you're John McCain, who just lost the election to Barack Obama, you have said you want to work with the Democratic president. So, Republicans get a morale boost, Anderson. Democrats do not get the magic number of 60.

But Barack Obama still will come to Washington in a few short weeks with a pretty good margin, a bigger Democratic majority in the House, a bigger Democratic majority in the Senate. The question now is, how do Republicans deal with him when the big issues come up for key votes?

COOPER: Yes. I mean, for Democrats, in terms of trying to get things done and make an impact, how important was this filibuster- proof majority? I mean, they can do stuff without it.

KING: It is critical from a symbolic standpoint.

But, again, many Republicans will vote with the Democrats on some of the big issues. The key question is more not so much what is the math in the Senate, but what is the calculation of Barack Obama? What kind of health care plan does he put forward? Will he put a forward a plan that allows those moderate Republicans from Maine to vote for it, that allows John McCain to come into negotiations with the liberal Ted Kennedy and try to work out a deal?

So, the burden is as much on Barack Obama, in terms of what type of agenda, what are the specifics of the big-ticket items. Will he put something in his tax plan that allows some Republicans to vote for it? So, you can look at it from the perspective of the Senate math. Democrats won't get to 60. But 59 is still better than they were when they started this election cycle.

Or you can look at -- and I think the better way to look at it is how does Barack Obama deal with the math he will have, bigger Democratic majorities in both the House and the Senate and most Republicans saying they want to, at least at the beginning, work with him?

Remember, Saxby Chambliss said he wanted to be a firewall. Southern Republicans want a firewall. Many other Republicans from other parts of the country think the best move for them politically, at least early on, is to try to work with Obama, not reflexively say they will be against him.

COOPER: And we should just show you these pictures at Chambliss headquarters that we will show you in a moment. They're anticipating him coming any moment now to speak. We will try to bring you those comments for a little bit at least as they happen. John -- John, this race, though, I mean, it drew John McCain, it drew Sarah Palin on the Republican side. Barack Obama, though, did not show up. There were some who -- you know, who wanted him to do more to try to help the Democratic -- the challenger.

KING: And, without a doubt, there is some grumbling in the Democratic Party that the only way for Jim Martin to win this race was to have a replay of what happened on November 4, election night, and even to do better than election night, because, of course, Saxby Chambliss got more votes than anyone else on election night. He just fell short, just short, of 50 percent.

The only way for Jim Martin to win in this very red state -- remember, John McCain carried Georgia on November 4 -- was for Barack Obama to come here and try to get African-American turnout to be even higher than it was on the presidential Election Day.

Now, the Obama campaign will tell you, they did a radio ad, they recorded some robocalls, and that his top priority right now is to govern the entire nation, that he has to be putting together his Cabinet, that he has to be speaking to those not only who voted for him, but who voted against him, and he couldn't be involved right now in a highly partisan race.

They will also, Anderson, tell you privately that they did not believe that, even if he came here, that the Democrat was likely to win a state that John McCain carried against Barack Obama on Election Day. So, they made the calculation to worry more about January than this one Senate runoff in December.

COOPER: And, John, it looks like we have just seen Saxby Chambliss on stage. I have a feeling he will be introduced by a couple different people before he makes comments.

In terms of Saxby Chambliss, how did he run, John? Did he run as this -- "I will be the guy to make a firewall against Obama"? I mean, was it -- was it national in that way? Or was it -- was it a local race?

KING: Well, it was both, because he did run as saying he would be the firewall. But, again, remember, he is campaigning in conservative Georgia, which has a Republican governor.

The man you just saw next to Saxby Chambliss who he may want -- that man in the red tie is Mike Duncan. He's chairman of the Republican National Committee. He just put out a statement saying this is proof that Republicans can win when they run on their core conservative values of less spending a strong national defense.

Saxby Chambliss ran on a message that you can sell in conservative Georgia, that you do not want Barack Obama to have so many Democratic votes that he can raise taxes; you do not want to have Barack Obama to have so many Democratic votes that he could, if he proposed, get the votes to cut military spending.

So, Saxby Chambliss essentially gave a warning to conservative voters in this state: Don't give Barack Obama another vote in the United States Senate.

You can sell that in Georgia. Again, it has a Republican governor. It is a conservative state. It has two Republican United States senators. That message would not have been effective if this were a runoff in the state of Maine, which is a much more progressive or Democratic or liberal state, but it worked here in Georgia.

The question is, when Saxby Chambliss goes to Washington and says, "I have a mandate to stand up to Barack Obama," what do the other Republicans, the other 40 Republicans in the room, say when he says, let's fight? Many of them, Anderson, early on will say, let's talk first.

COOPER: Dana Bash is also standing by at Chambliss headquarters.

Do we anticipate him speaking any time soon, Dana?

Dana Bash, can you hear me?

BASH: Hi, Anderson. Sorry about that. It's a little bit loud here.

Yes, we do expect Senator Chambliss to speak very soon.


BASH: But it's very noteworthy who's speaking now. And that is the chairman of the Republican Party.

Why is that noteworthy? Because, Anderson, I mean, I can tell you, covering a Republican during the presidential election for a long time, and -- and talking to Republicans back up on Capitol Hill, they are absolutely, positively demoralized.

And this is a very rare moment of glory and victory in a very, very bad year for Republicans. So, the national party, they are looking at this particular race, this particular victory in this runoff here in Georgia, and saying, you know, wow. This gives us a little bit of hope now.

Now, let's be -- let's be honest here. This is a Southern conservative state that nobody thought was even going to be competitive for Senator Saxby Chambliss, except that it was a very tough year, and there were other outside factors.

But, still, in terms of the mood, in terms of -- sort of their mental state inside the Republican Party, this is something that is extremely welcome -- Anderson.

COOPER: We're going to take a short break. We will be right back. We will bring you some of Chambliss' comments.

We will be right back.



REP. NANCY PELOSI (D-CA), SPEAKER OF THE HOUSE: I believe that -- that an intervention will happen, either legislatively or from administration. I think it's pretty clear that bankruptcy is not an option.

And let's talk about why. It takes too long. What can -- what bankruptcy achieves in a year, we can do in a matter of weeks.


COOPER: How Speaker Nancy Pelosi promising quick action on the $25 billion bailout for Detroit.

Two weeks ago, she sent carmakers packing back home on their private jets, telling them there would be no federal money until they came up with detailed restructuring plans. Well, today, they did, and they're drastic, including massive layoffs, pay cuts at the top, possibly eliminating entire brands, and, yes, selling the jets.

Meantime, new figures show sales cratering. About the only bright spot today, Wall Street, the Dow gaining back 270 point, after yesterday's massive sell-off.

We're talking about your money, your future.

As always, let's make sense of it with CNN's chief business correspondent, Ali Velshi.

So, the Big Three automakers submitted their plans today for this bailout. Auto sales numbers were dire today. What reassurances do we actually have that the money for them is going to be well spent?

ALI VELSHI, CNN CHIEF BUSINESS CORRESPONDENT: Well, here's the problem, Anderson. Auto sales for the year are going to come in at about 10 million. That's all the autos sold in the United States, all makers.

Last week, it was 16 million. And that was the ninth year that we were above 16 million. So, the automakers are saying that this isn't all their fault. Some of it might be their mismanagement. But a lot it is just the environment. People who want to buy cars now can't because they have lost their jobs. Others who -- who do have jobs can't get the credit easily.

Let me show you a little bit about how this all breaks down, the three automakers, starting with Ford. Ford is saying that they're going to make more small- and medium-sized cars. They're going to try and sort of de-emphasize some of the large truck business. Remember, Ford make the F series. That's the best vehicle in America for more than three decades.

They're also going to get into less complex car parts business, trying to make them work in more vehicles. They're asking for $9 billion out of the bailout package, but Ford did say that they probably don't need the $9 billion, unless things get worse than they have forecast.

GM is the biggest company, so we knew they would be asking for the most money. They are thinking about getting rid of their Pontiac and Saturn brand, maybe even selling off Saab. They have been selling off other brands that they own, like Volvo. They're thinking about selling off Volvo. They have sold Jaguar and Land Rover.

They said that they might have to cut between 20,000 and 31,500 jobs to make it work for them. And they're asking for $18 billion, about $12 billion, plus an extra facility of $6 billion.

And Chrysler is talking about alliances with other companies, you know, some way of trying to cut their costs and manage it. They're asking for $7 billion. That's a little tricky, because that's a -- a private company.

Now, if you have been following along with me at home, watching your news with a calculator, like I often do, you may find that the math doesn't add up. Anderson, you -- you tossed it to me talking about a $25 billion bailout. Well, nine plus 18 plus seven actually comes out to $34 billion -- Anderson.

COOPER: Yes. I'm not sure the numbers really add up to that $25 billion at all.

The Big Three CEOs, though, seemed to have learned, at least, from the -- the private jet P.R. fiasco the last time around.

VELSHI: Yes, they...


VELSHI: There's no private jets that went from Detroit to -- to Washington. They are going to be testifying on Thursday. All three are driving.

We knew that Ford's CEO had left this morning, General Motors' CEO had left. Both of them are driving in hybrid vehicles. Chrysler's Bob Nardelli, until last night, had not apparently made a decision as to how he was going to there. We thought he might fly commercial, but it was announced today that he's driving.

In exchange for, you know, getting there and trying to get some money, they're not going to go through that P.R. fiasco that they did last time. They're also, by the way -- General Motors' CEO and Chrysler's CEO had agreed the last time around to take a $1 salary. Ford's CEO has agreed to the same thing. They are also going to be eliminating a lot of bonuses.

So, they're trying to at least not to have the discussion distracted by their own behavior -- Anderson.

COOPER: What's so alarming is, there's this report out today from the GAO on the bailout, basically that -- that -- saying that Americans can't be sure where the tax dollars are going. How much oversight is there going to be on these carmakers? VELSHI: Well, that's interesting. The car bailout is $25 billion or $34 billion, depending on how you want to do the math.

The Government Accounting Office, they sort of keep track of what the government spends. And they came out and said, look, the bailout, the $700 billion bailout, there was supposed to be an agency of people appointed to oversee them -- that didn't happen until mid-November -- that some of the companies that are entrusted to do the work of the bailout might actually have conflicts of interests, and that Treasury has got to do a better job of keeping track of this money.

But, if you recall, Anderson, none of the recipients of that money had to go to Congress and come up with a plan. So, already, Congress is putting on, you know, tougher standards onto the automakers.

If they agree to give then the money, you will know at least there was a little more specific -- a little -- more specific strings attached to it than with the other bailout.

COOPER: All right. Ali, stick around.

David Gergen and Candy Crowley are going to join us next to talk about Detroit and the political situation, Saxby Chambliss, the balance of power, and more after the break.

Saxby Chambliss has begun speaking. That's a live shot of the victory celebration.

We're going to take a short break and we will bring -- right now, he's basically just thanking people. It's not terribly interesting. We are going to bring you some of his comments once he gets into the heart of his talk.

And new developments tonight: charges in the tragedy that took the lives of Jennifer Hudson's mother, brother and nephew -- details ahead on 360.



SEN. SAXBY CHAMBLISS (R), GEORGIA: ... and me, our family, and the whole campaign staff, as well as our folks who have gotten involved from a national perspective.

Because this race has been nationalized, people all around the world have truly had their eyes on Georgia. And you have delivered tonight a strong message to the world that conservative Georgia values matter.


COOPER: OK, that's Senator Saxby Chambliss, who has won reelection tonight in the state of Georgia. More on the financial meltdown now -- president-elect Obama in Philadelphia today meeting with the nation's governors. They are in dire straits, unable to borrow, social spending on the rise, due to the recession, tax revenue cratering, programs and jobs being cut left and right.

Their crisis may be the Obama administration's first big test, to the tune of hundreds of billions of dollars.

The big bucks and "Raw Politics" now from Candy Crowley.


CANDY CROWLEY, CNN SENIOR POLITICAL CORRESPONDENT (voice-over): Forty-one governors project red ink in their state budgets this year or next. So they were happy to hear this.

SEN. BARACK OBAMA (D-IL), PRESIDENT-ELECT: this administration does not intend to delay in getting you the help that we need.

CROWLEY: The president-elect is talking about the stimulus package his economic team is putting together to shock the economy back to life. Sources suggest the price tag could go as high as $700 billion, and governors want a piece of the action, though that's not how they put it.

GOV. ED RENDELL (D), PENNSYLVANIA: We are not here asking for money for governors. If we're asking for any money at all, it's for the citizens of our state, not for us, not for our budgets, but the citizens of our state.

CROWLEY: What governors want most is money to build or repair roads, bridges, mass transit, schools.

Knee deep in debt in California, Republican Governor Arnold Schwarzenegger figures it's a combo treat for strapped states: better roads built by workers who pay taxes to the state.

GOV. ARNOLD SCHWARZENEGGER (R), CALIFORNIA: I think that there's $136 billion of infrastructure projects ready to go all over the United States, including in California. We have $28 billion alone of projects that are ready to go, literally putting shovel -- shovels into the dirt within a few months after the administration starts.

CROWLEY: Barack Obama's trip to Philadelphia offered another chance to promise cooperation and solutions that transcend party. There are 22 Republican governors.

OBAMA: I offer you the hand of friendship, the same commitment to partnership as a do my Democratic colleagues. There is a time for campaigning, and there is a time for governing.

CROWLEY: And even some bipartisan humor from vice president- elect Joe Biden, who's been a bit of background player of late.

SEN. JOSEPH BIDEN (D-DE), VICE PRESIDENT-ELECT: And, Governor Palin, I want to thank you particularly. I might point out, as I told you, we walked in. Since the race is over, no one pays attention to me at all. So I -- I'm -- maybe you will walk outside with me or something later and say hello to me.


CROWLEY: Fresh off the Georgia campaign trail, the governor of Alaska, who once accused candidate Obama of palling around with terrorists, was enthused about palling around with president-elect Obama.

GOV. SARAH PALIN (R), ALASKA: The campaign is over. And I so appreciated this meeting that we had. And, you know, I'm quite optimistic about moving forward in a bipartisan manner.

CROWLEY: Even Pennsylvania Governor Ed Rendell, the toughest of Democrats, caught the spirit. Apparently unaware of an open mike, he mused with fellow governors about what Palin might say at a post- meeting press conference. And he praised her in a Rendell kind of way.

RENDELL: I think she -- I mean, she has great instincts. She's not a genius, but she has very good political instincts.

CROWLEY: Like the stimulus package, the practice of bipartisanship is a work in progress.


COOPER: Work in progress, indeed.

Candy joins us now from Chicago, along with CNN's senior political analyst and former presidential adviser David Gergen, who is in Boston. And with me again here in New York is Ali Velshi.

So, David, let's talk first about Saxby Chambliss. How big a win was this, not only obviously for Chambliss, but also for Republicans, tonight?

DAVID GERGEN, CNN SENIOR POLITICAL ANALYST: It was -- it was a major shot in the arm for the Republican Party. Dana Bash has reported it's been a demoralized party.

But I think, as important as anything, Anderson, these last couple of days have been a real dose of harsh reality for the Obama team. You know, after they had that -- they announced their economic heavyweights coming in, the market rallied for three days in a row there.

And, this week, the markets have been down. The economic news is -- is pretty dire. And now they have had this defeat in Georgia. And it seems to be a fairly decisive defeat. And I think it's really reminded the Obama team of, you know, as -- as much hope as they have and they have started in the country, there are some harsh limits they're bouncing up against. And this is going to be tough to govern. Obama had a good meeting with the governors today, but he's got a tough, tough road ahead.

COOPER: Candy, the Obama folks, I mean, do they have -- they don't have any illusions about how tough this is going to be?

CROWLEY: They don't, because it's not just that there will be enough Republicans to block a bill if they want to do it.

There are also Republicans, particularly in the South -- I'm sorry -- Democrats, particularly in the South, who would be willing to join Republicans on some bills. You know, they -- they totally understand. I mean, there's a reason the Rahm Emanuel, a former congressman from Illinois, is now the chief of staff in the White House.

There's a reason that a number of these people brought into the White House and some of those that are being nominated to Cabinet positions have congressional ties, because they understand that there are three branches of government, and one of them isn't always going to agree with Barack Obama.

COOPER: Ali, it's interesting, watching these governors, I mean, essentially with their hands out for their state . Some of them, particularly in California, are in big trouble.


COOPER: What are the options for -- for them?

VELSHI: Well, governments, state governments, if they run out of money, in some cases, could stop operating. They will have to -- you know, business will come to a halt. We have seen this on a federal level. That's what California is saying.

I don't know that, in every state, we're in that dire a circumstance. States have run deficits in the past. That's not the end of it. But, at this point, you need to be in the discussion. If you think you're going to get any money, this is the time to be in the discussion.

And I think that was a sense of -- of bipartisanship, the sense of cooperation that was going on. But the reality is, while they may be getting a honeymoon -- David referred to the fact that markets were rallying with the economic announcements last week -- well, Barack Obama can't continue to announce new people to his economic team. Now we're waiting for the plan.

Everybody has said they would like a piece of this plan. We need to see this plan. It could be $700 billion, Candy was reporting.

COOPER: David, it's interesting to see Sarah Palin out there, not only on the campaign trail for Saxby Chambliss yesterday, but then today at this governors meeting. She seems to be everywhere but in her state, you know, doing governance there. (LAUGHTER)

COOPER: And, I mean, really, the race, it seems like, for the Republican Party for 2012 has already begun. You have Governors Rick Perry, Mark Sanford in "The Wall Street Journal" today warning about, you know, a bailout mentality. Everyone already seems to be jockeying for position.

You have Mitt Romney, you know, wrote this essay saying, let -- let Detroit go bankrupt.

GERGEN: Yes, and Romney and Giuliani, as was Huckabee, they were all in Georgia.

But I have to say, this has been a big victory for Sarah Palin. She had four big rallies yesterday in Georgia. Saxby Chambliss really wanted her in there. And I think that -- I think she has got a big win under her belt now. This is going -- this is going to make her a hot property in the 2010 off-year elections. And a lot of Republicans will be looking to her.

COOPER: Can -- she can claim credit for the Chambliss win?

GERGEN: I don't think she can claim credit, but she shares in the spot -- basks in the spotlight with him, because she had this very high-profile visit.

But I want -- to go back just a moment to the importance of the Chambliss win, I think this actually puts a lot more pressure on Barack Obama to govern much more from the center, and not from the left. He is going to need Republicans now. He's going to need a bipartisan approach on his economic stimulus package and on other things.

Even though there's all these claimants lining up to get money, he's going to need some Republican votes. Schwarzenegger -- Schwarzenegger, by the way, could help in California, because he needs that money.

COOPER: Candy, what -- what's the evidence that he is ready to govern from the center?

CROWLEY: Well, he certainly has a lot of centrists that -- both economically and as regards national security, that he has put in the Cabinet.

There's some suggestion, of course, that, particularly when it comes to national security, but even as well when it comes to economics, that, if he puts these centrists in place, he has some cover to sort of rule left-of-center, to be president left-of-center.

So, we're -- we're -- honestly, he remains a virtual unknown in politics. We are not really sure where he's going to govern from. He's always said he's sort of free of the sorts of definitions that do, left of center, center, right of center. And, so, we will see.

But the fact of the matter is, he is still pretty much an unknown when it comes to how he will guide this country.

COOPER: You know, Ali, we keep hearing dollar figures being thrown around, you know, $25 billion for the auto industry...

VELSHI: Right.

COOPER: ... or, as you just saw earlier, maybe more than that.

Is there any evidence that this has been working thus far?

VELSHI: There is.

The credit freeze that we talked about all through September and October, the international credit freeze has loosened up substantially. What isn't working is, it hasn't trickled down to the ability of American companies to raise money and the ability of -- of you and I to get mortgages and loans. So, there is a stoppage at this level. But this is a problem that money can solve, if it's allocated the right way.

COOPER: But, I mean, we just heard this oversight report saying, essentially, there's not enough control over where this...

VELSHI: Right.

COOPER: ... all this money is going out. It's just being doled out...

VELSHI: That's right.

COOPER: ... kind of left and right.

VELSHI: And, to some degree, they tried something that didn't work. And history may judge them more kindly for having tried to buy up troubled assets and then decide that the money needs to go to the banks.

Fundamentally, it's -- the GAO didn't say the bailout is a failure. What it said is that there just has to be more oversight. There needs to be more attention paid to conflict. And, in a rush to do things, we can't dodge that.

If this $500 billion or $700 billion bailout program that the new administration is interested in pointing through goes through, we're going to be a lot more conscious of where that $500 billion or $700 billion is. There may be a lot of bipartisan support. There may be support from the center, but, fundamentally, we're going to look very carefully at where that's going and how it's going to help the economy.

COOPER: Well, let's hope so.

Ali, David, Candy, thank you.

Still ahead: Was Pakistan behind the slaughter in Mumbai? Today, for the first time, a high-ranking U.S. official suggests that it may have been. As tensions rise between India and Pakistan, and Secretary of Condoleezza Rice heads to the New Delhi, we will have the latest on the investigation and some new dramatic video of the aftermath of the attack.

And new developments in the tragic triple murder in Jennifer Hudson's family: An estranged family member has now been charged with the slayings -- that and more ahead.


COOPER: And new developments in the tragic triple murder in Jennifer Hudson's family. An estranged family member has now been charged with the slayings. That and more, ahead.



LARRY KING, HOST, "LARRY KING LIVE": Pakistan, you called on India to produce evidence of the complicity of any Pakistani group in the attacks. If it's produced, what would you do?

ASIF ALI ZARDARI, PRESIDENT OF PAKISTAN: I would put -- my government would take action. Our government would take action. The democratic government of Pakistan would take action against the -- all the actors and anybody who was involved.


COOPER: Pakistan's president, Asif Ali Zardari, insisting he is committed to fighting terror. But just hours ago, the chief U.S. intelligence officer tied the attacks to Pakistan.

National intelligence director Mike McConnell said U.S. intelligence believes the same terrorist group also attacked Mumbai trains in 2006 and the Indian parliament five years before.

Indian officials say that was the Pakistani group Lakshar-e- Taiba. Today, more dramatic video of the attack surfaced as the investigation uncovered new details.

Nic Robertson has a 360 dispatch.


NIC ROBERTSON, CNN CORRESPONDENT (voice-over): With each day of the investigation, more dramatic video. Here two of the gunmen again their ruthless killing spree. Their large backpacks and military stride hint at their deadly capability.

HASAN GAFOOR, MUMBAI POLICE COMMISSIONER: They were trained by some ex-army (ph) officers, and they've been in (UNINTELLIGIBLE) for some people, for a year and for some, for more than a year.

ROBERTSON: In his first news conference since the attack, Mumbai's police chief said the gunmen had come to, quote, "create a sensation" and kill as many people as possible.

There were ten of them, he said, on a suicide mission, directed over the phone by a controller inside Pakistan.

GAFOOR: It appears that it was a (UNINTELLIGIBLE) attack. And I do not think that they had any plans (UNINTELLIGIBLE).

ROBERTSON: More dramatic video taken from a surveillance camera at the train station, one of the first places to be attacked, has also been released. Cops can be seen cowering behind pillars. Local news stations say it's because they lack weapons to defend themselves.

There is a rising tide of anger here that the police were not better prepared. They had been warned, according to U.S. officials, of a seaborne attack.

Gafoor denied he had actionable intelligence capable of heading off the attack. The intercept, he said, was too vague.

GAFOOR: Saying that guards would repel the exact sites (ph). (UNINTELLIGIBLE) exposed to such danger.

ROBERTSON: Five taxis were used by the gunmen, according to Gafoor. They spread their terror and confusion by planting bombs in at least two of them. He also denied reports of an earlier mission by a team to plan the attack.

GAFOOR: (UNINTELLIGIBLE) And they were shown a map before that. And in any case, they had planned (ph) attacks.

ROBERTSON (on camera): When asked about the captured gunmen, Gafoor said he was cooperating well, confirming that he is a Pakistani.

On several occasions during the press conference, the police commissioner denied the attackers had had any local support, saying the police had discovered none so far. A surprising revelation to India's terrorism experts, who believe the gunmen must have had some Indian help.

Nic Robertson, CNN, Mumbai, India.


COOPER: U.S. intelligence had tied it to a group inside Pakistan. The level of -- or the knowledge of Pakistan government is still something that is under investigation.

A chilling new report about the threat of terrorism here at home. We'll talk to CNN national security analyst, Peter Bergen.

But first, Erica Hill joins us with a "360 News and Business Bulletin" -- Erica.

ERICA HILL, CNN ANCHOR: Anderson, Jennifer Hudson's brother-in- law is now facing three counts of first-degree murder. William Balfour charged today in the fatal shootings of the Oscar winner's mother, brother, and 7-year-old nephew in Chicago. Balfour is the estranged husband of Hudson's sister.

Two Wal-Mart customers are now suing the retailer for $2 million, claiming they were injured in that Black Friday stampeded that killed a Wal-Mart employee on Long Island.

Nassau County, New York, Police Department has also named the men claim the officers on duty that morning were negligent. The police department has said it does not comment on open litigation.

And another hit for New York Giants football star, Plaxico Burress, the Giants suspending the wide receiver for the year today, after he accidentally shot himself in the leg at a Manhattan nightclub over the weekend.

Burress didn't have a permit for that gun, and he is charged with illegal weapons possession, Anderson.

COOPER: All right, Erica.

Up next, a chilling new report that says terrorists are likely to use a weapon of mass destruction in the next five years. Our own Peter Bergen was interviewed for the report. He'll join us to talk about it.

Also ahead, an American cruise ship attacked by pirates. Shots were fired. We'll tell you what happened, coming up.


COOPER: You're looking at new video that has surfaced, showing the actual capture and beating of the sole surviving attacker in Mumbai.

Last week's attacks killed at least 179 people including at least six Americans. And as bad as the Mumbai carnage was, there's a new report warning of the growing danger of a much deadlier attack. The report, commissioned by Congress, warns terrorists are likely to strike with a nuclear or biological weapon of mass destruction sometime in the next five years.

Let's dig deeper with CNN national security analyst, Peter Bergen.

Peter, first, let's talk about what happened in Pakistan. This group that is now suspected of being involved in the attacks, do we know to what degree the Pakistan government is aware of this group, you know, and involved in this group?

PETER BERGEN, CNN NATIONAL SECURITY ANALYST: Well, they're certainly aware of this group, because they banned it in 2002. But this group is a very large group, Anderson.

Like Hezbollah, it has a sort of political wing and a social welfare wing. It has an annual meeting where hundreds of thousands of people show up. It used to have offices around the country. This is a major, major organization. It's not a small terrorist group. This is a very large organization.

The Pakistani government have cracked down on it, but it's re- emerged with a different name and, obviously, continues to be very violent and quite effective, unfortunately.

COOPER: You're one of hundreds of people interviewed for this congressional report. And the report concluded, and I quote, "America's margin of safety is shrinking, not growing" and predicts that under these conditions there's going to be a WMD attack somewhere in the world in the next five years.

Why have things gotten worse and not better since the anthrax attacks, say, back in 2001?

BERGEN: Well, I think part of this is when we talk about WMD, it's not a very useful phrase. A weapon of mass destruction. There's only one weapon of mass destruction. That's a nuclear weapon. Everything else -- chemical weapons, biological weapons -- do not create mass casualties.

And when -- when terrorists have used chemical weapons or biological weapons, they've killed very few people. The anthrax attacks that you mentioned killed five people. Those -- the anthrax attacks were prepared by one of the United States' leading scientists, according to the U.S. government. So if he can't weaponize anthrax into something that kills a lot of people, how can terrorists do it?

I mean, terrorists, I think, they're going to continue doing the things we see in Bombay, killing people with AK-47s, blowing up car bombs, blowing up truck bombs, because these are readily easy to do. To weaponize a chemical weapon, biological weapon is pretty difficult.

And for a terrorist group to acquire nuclear weapons, in my view, is almost impossible. You know, look at Iran. Iran has had a nuclear program now for almost 20 years, has spent a huge amount of money on it. It still doesn't have nuclear weapons.

So buying, acquiring, stealing or developing your own nuclear weapons is something that states find very hard. For a terrorist group I think it's almost impossible.

So I take, Anderson, a much more skeptical view. I think it's great that this group is sounding the alarm. We don't want to be in a position, as we were with 9/11, where something catastrophic happens and we realize we could have done things.

However, I think it's important for the audience to understand that, you know, we can't just sort of be fearful of things that have a very low probability.

COOPER: It's interesting, because the report says Pakistan could have become an unwitting source of a terror attack in the U.S. Pakistan always says that they're doing all they can. Are they really? I mean, does the Pakistan government know everything that their own intelligence service -- service is up to?

BERGEN: Well, you know, I spent a fair amount of time in Pakistan. And it's a country which is quite difficult to operate as a reporter. The more you know about it, the less you know about it, on some levels.

The Pakistani government sometimes says it's going to do things -- I mean, just take one example of this Bombay case. They said at one point that they were going to send the head of the military intelligence agency -- the civilian leadership said they would send the head of the military intelligence agency to India to help out with the investigation.

And then that was countermanded by the military intelligence agency. So who's really in charge?

The problem is you've really got two governments. And the civilian side may say one thing, and the Pakistani military intelligence side may say something else. So that's -- that's a problem right there.

Plus there's a question of weakness of the military to go after the militants. Is it -- is it a lack of capability? Is it a lack of, you know, intention? It's not clear.

COOPER: Frustrating. Peter, appreciate it. Peter Bergen, terrorism analyst.

Still ahead, CNN political contributor Bill Bennett has dreamed up a fascinating calendar of history. It's a book he hopes President- elect Obama will read. He joins me just ahead to talk about that, as well as his opinion of Hillary Clinton as secretary of state.

Plus, President-elect Obama facing his biggest test yet. States all across the country are going into meltdown, just like Detroit and the banks. Coming up, the big bucks and "Raw Politics."

And the most dangerous growth industry on the high seas: piracy. An American cruise ship attacked by pirates. Shots were fired. We'll tell you what happened. Stay tuned.


COOPER: Barack Obama is going to announce tomorrow that he'll appoint New Mexico Governor Bill Richardson to be commerce secretary. We asked CNN political contributor Bill Bennett in to talk about Obama's cabinet picks so far. He has a new book out. It's called "The American Patriot's Bible [SIC]." It's a fascinating day-by-day account of American history.

We talked earlier. Take a look.


COOPER: The book is "The American Patriot's Almanac." What's so -- and it's basically a day-by-day compilation of U.S. history and sort of what happened on this day in American history.

And I think what's so cool about it is that, not only so many young people don't know American history, but it also just, for us older people, it -- it sort of connects the past to the present in a very real way, in a very tangible way.

BILL BENNETT, CNN POLITICAL CONTRIBUTOR: I'm trying to do that. This is part of -- I've done a bunch of books, as you know. But Tom Wolfe has a great phrase called "the great relearning." We need to relearn all these things that we once knew but forgot, or maybe, some of us, we never learned them, so we need to learn them for the first time. That's what I'm trying to do.

I mean, one of the task here, is to make history come to life. And with this idea of an almanac, you can do a lot of angles here.

COOPER: What do you think Barack Obama -- I mean, he's reading a lot, apparently. What do you think he would get by reading this book?

BENNETT: Well, I hope he would get the same thing. I hope he might pick up the book and look at a date or two.

Look, there's not much you can say about Barack Obama's failure to appreciate, you know, the weight that is on him and the history that comes before him. He's very, very clear about that and very impressive. He's also remarkably, remarkably well read.

And one gets the sense -- I do -- and, look, my team lost, you know. I wish my team had won, McCain, but we lost. One gets the sense that he is trying to be a good president. And he is not regarding the critics, even the critics of his own party, who I think are probably going to be harder on him, my guess, in the next few weeks and months, than will be the critics on the right.

COOPER: What do you think about Hillary Clinton, specifically, as secretary of state?

BENNETT: I don't mean this facetiously. I want her on my side. I mean, if you're in a tough fight in a tough world, and we're going to have that, I would rather have Hillary Clinton on my side.

I hope she continues to have political ambitions, because that will keep her thinking, "What is it that I have to do to be able to advance the interests of America and have Americans approve of what I do?"

I mean, she is no crazy lefty. I think we saw that during the campaign. You remember the business on Iran? What would you do if Iran attacked Israel? And this was all the discussion with Obama about whether he'd sit down and negotiate. Hillary said, "I would obliterate." The word was "obliterate." I know, because we had fun with it on the radio, played it over and over again, saying, you know, that's our gal.

But yes, I mean, I think -- I think she could be an excellent secretary of state. She'll be very active. She'll be very strong. And I think this is a fascinating choice.

COOPER: You know, you go through the almanac, and you look at what other presidents faced as they came to office. Do you think any American president in our lifetime has faced so many obstacles on so many different fronts?

BENNETT: Number of obstacles? Maybe not. You remember what Harry Truman said when Roosevelt died. He said he felt like the moon and stars had fallen on him a lot. You know, this was -- this was a very, very big deal.

You know, Gerald Ford had -- had some things he had to inherent that were pretty tough, pretty serious. The range of problems, perhaps not. Perhaps not as many as Barack Obama's facing.

And look at the reminder in these last few days with the situation in India. We spent a lot of time together during the campaign. Campaigns are interesting but fictional pieces, you know. No tradeoffs; promise everything. Now comes reality.

And a lot of the questions that people like me had about Barack Obama were, you know, is he ready for prime time? So far he looks to be ready for prime time.

COOPER: The book is "The American Patriot's Almanac." It's something you can not only read all the way through but also kind of pick and choose and read every day a little bit as you go.


COOPER: "The American Patriot's Almanac."

Just ahead, pirates, terrorizing the high seas and raking in millions. In one of the latest attacks, an American cruise ship was the target. A chilling brush with danger on the high seas. We'll tell you what happens ahead.

And "Raw Politics" in Romania. Really raw. Take a look at this debate. Yikes! We'll tell you what that was about, up next.


COOPER: New details tonight about a brazen attack on a luxury cruise liner. The ship was sailing between Rome and Singapore with nearly 700 passengers on board, including many Americans. It was attacked by a band of Somali pirates. There were gunshots. The cruise ship got away but the dramatic incident is part of an escalating problem in the region.

Erica Hill takes us up close.


HILL (voice-over): Most of these pirates have always made their living on the sea, but before they were fisherman, not hijackers and thieves. In a country with no real government and intense poverty, it isn't hard to see how they're adding to the ranks.

"BOYAH", SOMALI PIRATE (through translator): We work together and our ranks grow because there is more hunger and more skills. That is what causes more people to join piracy. Piracy is growing faster. But it is not something that is lessening. The world cannot do anything about it.

HILL: In the past year the pirates have collected an estimated $150 million in ransoms. And while there are international war ships patrolling the area, all the technology in the world can't monitor every inch of these waters. And the pirates know it.

ADMIRAL MIKE MULLEN, CHAIRMAN OF THE JOINT CHIEFS OF STAFF: Tactically, they're very good, so when they get to a point where they can board, it becomes very difficult to get them off, because now they hold hostages.

HILL: Coalition forces won't board a hijacked ship for fear of harming the hostages.

(on camera) This map, maintained by the International Maritime Bureau, shows every pirate attack, and there have been more than 90 this year, more than 35 of them successful hijackings.

And in just the past week, at least five incidents in the Gulf of Aden, with 28 people taken hostage.

(voice-over) So how do the pirates, often traveling in scrappy- looking boats, no bigger than a car, manage to overpower some of the biggest ships at sea? Weapons, including RPGs, which could blow up a tanker.

And even if ships have security guards, they're often unarmed. The International Maritime Organization strongly discourages weapons on board merchant ships.

Security expert Will Geddes says these pirates are also masters of disguise.

WILL GEDDES, CEO, INTERNATIONAL CORPORATE PROTECTION: They can either pretend to be officials that are seeking to board the actual ship for inspections. They can masquerade as Coast Guard.

HILL: The other sobering and powerful point in their favor: the pirates know that right now, they have the upper hand.


COOPER: It's amazing that, you know, a couple guys in a boat can take over a huge ship like this. A lot of these ships are unarmed. What can be done to stop this?

HILL: Well, actually, it's such -- it's such a matter of concern for the U.N., for all these countries, that NATO, the NATO ministers are meeting in Brussels, actually, starting today. And this was top of their agenda, because there have been so many demands for NATO to act, to do something a little bit more active here, that this is what they're talking about right now.

So hopefully, we'll get some information over the next few days as to what they'll be doing to step up efforts.

COOPER: All right. Erica Hill, thanks.

Up next on 360, a debate that takes "Raw Politics" to a different level. Have you seen this? It's our "Shot of the Day." It gets heated and a little water thrown. Boom. We'll tell you what happened.

And coming up at the top of the hour, breaking news that has a direct impact on the balance of power in the Senate.


COOPER: All right, time for "The Shot." We're no strangers to heated political debates, Erica and I. But you don't often see something like we caught today on Romanian TV. A discussion. She drops the water, and then boom. Yes.

HILL: Ooh! And here's the water back. I love that look.

COOPER: And then she's just like, "Really? Do you go there?"

That guy is a former body builder turned senator and his opponent...

HILL: That's why she's not getting up from her chair.

COOPER: Exactly. And I guess that -- maybe he's still on the roids and maybe that's why he...

HILL: Roid rage, never -- it's never pretty.

COOPER: See it again? And boom, yes. Bizarre.

We don't see that in America too often, do we?

HILL: No. Not nearly enough.

COOPER: Yes, all right. And roll it once more?

HILL: There you go.

COOPER: All right. You can see all the most recent "Shots" on our Web site,

And one more time. What was that, five times we've shown it now?

HILL: Never enough, never enough.

COOPER: All right. Coming up at the top of the hour, serious stuff. The Georgia Senate runoff -- no water thrown there -- and how it affects you, no matter where you live.

And what the president-elect told governors looking for hundreds of billions of dollars from Washington. All that and more tonight.