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Blagojevich Ousted; Obama Outraged at Wall Street Bonuses

Aired January 29, 2009 - 18:00   ET

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


WOLF BLITZER, CNN ANCHOR: To our viewers, you are in THE SITUATION ROOM.

Happening now: the breaking news we are following. The Illinois governor, he is ousted. The Senate has just voted. You saw it live here on CNN. The reaction is coming in this hour.

Also, President Obama says it's outrageous and shameful. You are going to hear for yourself why he is lashing out at some of those Wall Street firms.

Plus, the president pushes his economic rescue plan forward after being snubbed by Republicans in the House. This hour, lessons learned before the next round in the Senate.

And the people behind the unemployment numbers, huge numbers, they are, laid off workers reveal what they want to get from Washington -- all of that, plus the best political team on television.

We want to welcome our viewers in the United States and around the world. I am Wolf Blitzer. You are in THE SITUATION ROOM.

President Obama is taking advantage of his bully pulpit to blast Wall Street fat cats for getting bonuses while many Americans are barely able to make ends meet.

Let's go to the White House.

Our correspondent, Dan Lothian, is standing by.

It's been a dramatic day. And we saw the president of the United States in this, his second week of office, he got passionate, and he is -- he was clearly angry, Dan.

DAN LOTHIAN, CNN WHITE HOUSE CORRESPONDENT: And that's right, Wolf.

And the reason for that is because, as you know, Wall Street has been getting a lot of bailout money. So, the president says he is outraged after reading an article about these Wall Street bankers getting billions in bonuses.

(BEGIN VIDEOTAPE)

LOTHIAN (voice-over): President Obama called it the height of irresponsibility, a report in "The New York Times" that Wall Street bankers raked in more than $18 billion in bonuses last year, that despite huge losses and layoffs in the financial industry.

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: At a time when most of these institutions were teetering on collapse and they are asking for taxpayers to help sustain them, and when taxpayers find themselves in the difficult position that, if they don't provide help, that the entire system could come down on top of our heads, that is the height of irresponsibility. It is shameful.

LOTHIAN: The president, who lashed out at Wall Street while meeting with Treasury Secretary Timothy Geithner in the Oval Office, said there will be a time for them to make profits and bonuses, but not now.

OBAMA: What we're going to need is for the folks on Wall Street who are asking for help to show some restraint, and show some discipline, and show some sense of responsibility.

LOTHIAN: But there questions about what the administration can do to crack down. TARP addresses executive compensation, but critics say the enforcement mechanism is toothless.

JOHN FEEHERY, REPUBLICAN STRATEGIST: And that's the big problem. Accountability is a huge part of the problem with this TARP program. And I think that, in the next TARP program, they are going to have to have more accountability.

(END VIDEOTAPE)

LOTHIAN: What the president does have is leverage. These banks are relying on the government to get more bailout money.

So, the president has a bully pulpit, if you will, to push these CEOs, to push these top executives to spend their money wisely. The question is, will they listen? -- Wolf.

BLITZER: Dan Lothian is working the story at the White House.

Let's go up to Capitol Hill right now. Dana Bash is taking a closer look at the economic recovery plan, the so-called stimulus bill, after the Senate is about to take it up on Monday, no GOP votes in the House, as you know.

Dana, what's going on, on this, the day after the president was rebuked by the GOP in the House?

DANA BASH, CNN SENIOR CONGRESSIONAL CORRESPONDENT: What is going on, Wolf, is that you still talk to Republicans, privately, especially, and they say, look, they still think, despite the bad economy, despite President Obama's popularity, it is still politically beneficial for them to oppose this stimulus plan as it is written in the Senate as well.

But the question is whether or not Democrats made it easy for them to vote no.

(BEGIN VIDEOTAPE) BASH (voice-over): House Speaker Nancy Pelosi insists passing an $800-plus billion stimulus bill in eight days was pure victory.

REP. NANCY PELOSI (D-CA), HOUSE SPEAKER: I take credit for the great action taken by the Congress.

BASH: But to some, the fact that it was so partisan, no Republican votes, suggests the Democratic leadership made some major tactical errors. Even some of Pelosi's fellow Democrats say their own leaders robbed Barack Obama of bipartisanship he preaches by adding too much government spending that won't stimulate the economy.

REP. JIM COOPER (D), TENNESSEE: We have an amazing situation here, a bold, new, idealistic president who stands for change, and an old-fashioned, set in its ways Congress.

BASH: That's a fellow Democrat who voted no, but Pelosi bristles at any suggestion that her leadership caused the partisan divide.

PELOSI: I didn't come here to be bipartisan, I didn't come here to be bipartisan. I came here, as did my colleagues, to be nonpartisan, to work for the American people, to do what is in their interest.

BASH: The reality is, Republicans are doing what's in their best political interests, opposing Democratic programs conservative constituents despise.

STUART ROTHENBERG, EDITOR AND PUBLISHER, "THE ROTHENBERG POLITICAL REPORT": The nature of the opposition is to oppose and to be able point out disagreements with the majority party. I think the Republicans performed just as we would have -- should have expected they would.

BASH: Now an even bigger $900 billion stimulus bill moves to the Senate and Democratic groups are pressuring several GOP senators with ads, hoping to make this vote bipartisan.

(BEGIN VIDEO CLIP, AD)

NARRATOR: Tell Congress to support the Obama plan for jobs, not the failed policies of the past.

(END VIDEO CLIP)

BASH: Yet, already, a dozen GOP senators lined up to voice the same criticisms as their House brethren -- not enough tax cuts and too much spending on programs that won't stimulate the economy.

SEN. JON KYL (R-AZ), MINORITY WHIP: Republicans have appreciated the president's outreach to present ideas, but we are too often met with this response: "We won, and, therefore, we are going to do it our way."

(END VIDEOTAPE)

BASH: Now, Republicans in the Senate will have more chances to do it their way, to offer their ideas as amendments in the Senate.

But the reality is, Wolf, we have talked to some Democrat who actually feel the same way about spending on things they think are just not necessary. For example, Senator Ben Nelson of Nebraska complained to us, why do we need $75 million in programs to stop smoking? He said, the's not going to stimulate the economy.

BLITZER: All right, Dana, thanks very much. As Dana says, the debate in the Senate will start on Monday. We will see when the vote actually happens.

In the meantime, let's go back to Jack for "The Cafferty File" -- Jack.

JACK CAFFERTY, CNN ANCHOR: All right, I have got a bone to pick with my own industry. That would be the news media.

Minnesota held an election for a Senate seat last November. It is now almost February and they still can't figure out who won, Norm Coleman or Al Franken. I stopped caring several weeks ago. Minnesota elected Jesse Ventura to be the governor. He's a wrestler. They have no credibility when it comes to elections.

Illinois Governor Rod Blagojevich came to New York a few days ago to babble incoherently on all the television shows about all the various changes pending against him, including his impeachment, and the news media reacted like he was the second coming. If the New York media is hungry for $3 bills, we have a fine homegrown crop of our own without indulging this narcissistic, phony product of Illinois machine politics.

And, finally, there is my all-time favorite empty dress. That would be Sarah Palin. She announced that she is forming a political action committee. I will give you 8-5 she can't spell it. But the media breathlessly jumped on this story like the future of the free world hung in the balance.

Who cares? The next presidential election is almost four years away and Sarah Palin has as much chance of being the next president as Bugs Bunny does.

OK. I feel better now.

Here's the question. How tired are you of hearing about Rod Blagojevich, Al Franken, Norm Coleman, and Sarah Palin?

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

BLITZER: I love it, Jack, when you tell our viewers and me how you really feel. That's encouraging. Thank you.

CAFFERTY: Glad you liked it.

BLITZER: I did like it.

Jack Cafferty will be back with your e-mail. That's coming up. Attention, Wall Street. President Obama sends a very harsh message to you.

(BEGIN VIDEO CLIP)

OBAMA: Part of what we're going to need is for the folks on Wall Street who are asking for help to show some restraint, and show some discipline, and show some sense of responsibility.

(END VIDEO CLIP)

BLITZER: He says -- and I'm quoting now -- "It's shameful" if anyone expects taxpayer money and gives millions of dollars in bonuses to top CEOs and other corporate executives.

The president wants his treasury secretary to make this message clear. We are going to hear extensively this hour from President Obama. He's going to tell us how he really feels.

And it's not playing well in Peoria, Caterpillar slashing thousands of jobs. You are going to want to hear from the workers who need help. They need help now. And you're going to find out why the economic plan may wind up hurting some of these workers. John King is standing by in Peoria.

And what might you get out of this plan? We have details, information you need to know right here in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: The economy is certainly a mess, but if you are out of work right now, you may have just one question about the president's economic recovery plan that is moving through Congress. How will this plan help you?

Let's go to our national political correspondent, Jessica Yellin. She is digging deeper into this proposal, this economic stimulus plan.

What are you finding, Jessica?

JESSICA YELLIN, CNN CONGRESSIONAL CORRESPONDENT: Wolf, it's $819 billion with so many components, lots of people are confused about exactly how the stimulus would work. So, I took a look at exactly how it might help somebody who has lost their job.

(BEGIN VIDEOTAPE)

YELLIN (voice-over): At Kodak, Starbucks, Home Depot and Target, thousands are getting pink slips. House Democrats say help is on the way.

REP. ALAN GRAYSON (D), FLORIDA: What this bill does is, it meets human needs. It does what a just society does. It feeds the hungry, it shelters the homeless, and it heals the sick.

YELLIN: That's a tall order. So, how would this bill help? For anyone who has lost their job, the bill almost doubles the amount of time you can collect an unemployment check. And it adds $25 to that check every week. That's cash in your pocket.

UNIDENTIFIED MALE: We will check your blood pressure.

YELLIN: If you lose your job, you lose your health care. Now, some people are allowed to buy into their old company health insurance, but it's incredibly expensive. With this bill, the government would pick up 65 percent of your health insurance premium, making it affordable to more people.

There is another more controversial option in the bill. Through next year, it would let states accept anyone who collects unemployment insurance into Medicaid. That's the government health care program usually open only to the very poor. Now, some conservatives are howling about the idea of letting more people into Medicaid. And the Senate is against it.

SEN. MITCH MCCONNELL (R-KY), MINORITY LEADER: If we don't rein this spending in, soon, we will have only a fraction left for things like defense, roads, bridges, and education.

YELLIN: And the crucial piece of a rescue, getting you a job. One approach, this bill gives grants to build more broadband Internet. If your area gets a grant, you could get a job laying fiber or taking orders for new broadband at a call center. And with more Internet, more people in your area might shop online or open home businesses, helping the economy even more.

(END VIDEOTAPE)

YELLIN: Now, Wolf, before we start thinking this is a solution to all our problems, there are some downsides. For example, these grants they talk about for broadband, even if your area would get one, it takes time for that money to get out the door and get to you in your community.

Also, there is no job training in the bill. So, it has its own limitations, but supporters say even that one broadband portion could create 100,000 jobs. No one is certain. We will have to wait and see.

BLITZER: Jessica Yellin doing some excellent reporting for us, as she always does -- thanks, Jessica, very much.

There is also money in that economic stimulus plan to computerize medical records involving all of us.

Let's go to Ted Rowlands. He is watching this story for us.

All right, tell us what this is all about and how it creates jobs.

TED ROWLANDS, CNN CORRESPONDENT: Well, Wolf, we are in the records room of Centinela Hospital in Inglewood, California. You look around here, this is just a few months worth of records. The rest are off site. It takes two to three days to get them back here to the hospital. It's a horribly inefficient system, yet, 90 percent of hospitals and clinics use this system. If the Obama stimulus package does get through as it is currently written, all of this could go away.

(BEGIN VIDEOTAPE)

ROWLANDS (voice-over): If health records were computerized, years from now, this baby could read about this visit to the doctor online. And over his lifetime, every physician that treats him would be able to see his entire medical history.

The Obama stimulus plan calls for $20 billion of taxpayers' money to help get the medical community to start keeping computerized records. The government estimates the investment will create or save 240,000 jobs.

Von Crockett, president and CEO of Centinela Hospital in Inglewood, California, says he would love to get rid of the old system if it's done right.

VON CROCKETT, CEO, CENTINELA HOSPITAL: If there is not an agreement on the standards of what we are going to be doing associated with it, then all we're going to be doing is computerizing our inefficiencies to begin with.

ROWLANDS: The fact is the health care industry has yet to agree on the details of exactly how a systemwide records transition should be done. That means taxpayers could be forking over $20 billion to an industry that doesn't have a specific plan on how to spend it.

Dr. John Glaser, who has been working on this problem for years, admits waste should be a taxpayer concern, but says the opportunity to get this done should not be lost.

JOHN GLASER, PARTNERS HEALTHCARE: This happens to be a way to get it done at this time. It does have an economic stimulus portion to it. And so it fits. And it provides a way to accomplish something that we all know ought to be accomplished and frankly has languished for a while.

(END VIDEOTAPE)

ROWLANDS: The jobs we are talking about with this $20 billion would be software developers, hardware installers, and an army of technicians who would come out to hospitals and clinics and show doctors and their staffs how to use this new system.

But, Wolf, if you are looking for a job in this industry right now, it is going to be a while. Realistically, you're not going to see -- because there are so many questions that still need to be ironed out -- any job development until probably 2011.

BLITZER: Thanks very much, Ted Rowlands, in Inglewood, California.

His foreign counterparts are eager to meet him, but where in the world will President Obama go first? We are taking a closer look at the destination and what might follow.

And the president says he is outraged -- outraged -- over reports of huge bonuses for Wall Street bankers. We are going to let you hear from President Obama. He is speaking passionately. He's outspoken on this issue. Stand by. The best political team on television is standing by as well.

(COMMERCIAL BREAK)

BLITZER: So, how is the president's economic stimulus plan playing in Peoria?

We sent our chief national correspondent, John King, to Peoria to find out.

John, what are they telling you there?

JOHN KING, CNN CHIEF NATIONAL CORRESPONDENT: Wolf, for the longest time, Peoria was doing quite well even though we saw all the trouble in the auto industry, other manufacturing across America. In fact, the local motto is, it's better here in Peoria.

One of the reasons they say it's better here is because Caterpillar, the big manufacturer, the tractor maker, the heavy mining equipment maker, is the backbone of the local economy. And throughout the last few years, it has been thriving, because so much of that heavy equipment is sold to China, sold to South America and sold to overseas, so not impacted by the U.S. recession, but not anymore.

As you see right here, Caterpillar now this week announcing it will shed 20,000 jobs in the first quarter of 2009. We met with some of those today, among them, Chris Gwynn. He moved his family here from Las Vegas. He wanted a better life working on the factory floor here. He found out, though, that he will be out of work in two weeks.

Now, Chris Gwynn says he is doing OK because his wife works full- time, but he says morale at the factory now is quite low, as thousands prepare to lose their jobs. He does, though, Wolf, follow closely the economic debate in Washington. He voted for President Obama and he says it will take some time, but he thinks the new president eventually will help the economy come back.

(BEGIN VIDEO CLIP)

CRHIS GYWNN, CATERPILLAR WORKER: I believe he is going to help it out. Everybody is worth giving that chance to. And I was one that did vote for him. And I want to give him a fair shot.

I know it's not going to happen overnight, but I'm willing to let him see what he was going to do. Since day one, he has already made progress and I'm very happy with what he has done already.

(END VIDEO CLIP)

KING: By not overnight, Chris Gwynn says he gives the new president about two years, although he acknowledges many of his co- workers who are about to be on the unemployment line, Wolf, are not so patient. And he acknowledges as well that while he is hopeful some of that billions of dollars in stimulus money comes to places like Peoria, he is always skeptical, he says, when the politicians are spending so much money.

BLITZER: John, there is a rider in there, a proposal that would force the money to be spent on American-made products, a buy American rider, as it's called. How is that playing in Peoria?

KING: It's a fascinating question, because if you talk to most blue-collar workers, they think that's a great idea. It certainly sounds patriotic as you rebuild bridges over rivers like this, use American-made steel, use American-made construction products.

But Caterpillar, as I just noted, Wolf, about 50 percent of its equipment is sold overseas. And we went down on the factory floor today and we met a man named Jim Lierle. He has worked at the company for 39 years. Imagine that, 39 years working for Caterpillar, and he says he is worried about that rider made in America.

It might sound good to the politicians, he says, but with so much of Caterpillar's work being sold overseas, he is worried buy America will ignite a trade war and that foreign countries like China and in South America will retaliate against companies like Caterpillar, a trade war he says that could make those 20,000 jobs lost at Caterpillar just the beginning.

(BEGIN VIDEO CLIP)

JIM LIERLE, CATERPILLAR WORKER: We are worldwide. We have got to have that world market. We have got to have it -- 50 percent of these tractors are going to go overseas. And we can't lose that. If we lose that, we are going to go down.

(END VIDEO CLIP)

KING: And as he worries about his job, Wolf, even though he has been there 39 years, Jim Lierle too says he is willing to give President Obama a chance, but he was a bit more skeptical. He says he believes the president is off to a good start, but he says he has to earn his respect. And one way he could earn that respect, Jim Lierle says, is standing up to the Democrats in Congress pushing that buy American rider -- Wolf.

BLITZER: And John is going to have a lot more on this. He is traveling around the country, getting ready for his new Sunday show, "STATE OF THE UNION," that airs at 9:00 a.m. Sunday mornings. John will have more from Peoria and elsewhere.

You are not going to just stay in Washington, are you, John? You're going to travel the country.

All right, good.

KING: As much as we can, Wolf, get out here.

BLITZER: All right, good work. All right, John King, thank you.

President Obama is not mincing any words about the billions of dollars, yes, billions of dollars of bonus money going to some Wall Street big wigs, despite the fact that they are begging for taxpayer bailouts. Stand by to hear the president of the United States in his own words. Let me put it bluntly. He is outraged.

And the Illinois governor has been ousted. What now? Candy Crowley, Gloria Borger, Steve Hayes, they are standing by on the breaking news.

And there's new pressure on some Senate Republicans to support the Obama economic plan after their House colleagues snubbed President Obama.

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

(COMMERCIAL BREAK)

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

Happening now: Russia and Cuba beefing up ties. Fidel Castro's brother, the Cuban president, Raul Castro, received a warm welcome to Moscow, despite the chilly temperature. On the agenda, agreements increasing trade, investment and cultural contacts between the two nations.

Confirmed -- the Senate approves retired Admiral Dennis Blair as the new national intelligence director. He will oversee the end of some of the Bush administration's interrogation tactics and the plans for the closing of the Guantanamo Bay detention center.

And kicked out -- Iraq bans the U.S. security firm Blackwater in the wake of the 2007 shooting that killed 17 Iraqis -- all of this, plus, the best political team on television. I'm Wolf Blitzer. You are in THE SITUATION ROOM.

Never again. President Obama says he is not just trying to fix the economy, but he's trying to ensure that the United States never sees this kind of economic mess develop again. And he is expressing outrage at reports of huge executive bonuses out there on Wall Street, even at companies that needed bailouts.

Here's what the president said earlier.

(BEGIN VIDEO CLIP)

OBAMA: I just had a terrific conversation with my secretary of the treasury, vice president, as well as the rest of our economic team, about the steps that we need to move forward on, not only on the economic recovery and reinvestment package, but also on making sure that we begin the process of regulating Wall Street so that we can improve the flow of credit, banks start lending again, so that businesses can reopen, and that we can create more jobs, but also to make sure that we never find ourselves in the kind of crisis that we're in again, that we've seen over the last several months.

And Secretary Geithner is hard at work on this process. We expect that, even as the reinvestment and recovery package moves forward, as I said, that's only one leg of the stool, and that these other legs of the stool will be rolled out systematically in the coming weeks, so that the American people will have a clear sense of a comprehensive strategy designed to put people back to work, reopen businesses, get credit flowing again.

One point I want to make is that all of us are going to have responsibilities to get this economy moving again. And when I saw an article today indicating that Wall Street bankers had given themselves $20 billion worth of bonuses -- the same amount of bonuses as they gave themselves in 2004 -- at a time when most of these institutions were teetering on collapse and they are asking for taxpayers to help sustain them and when taxpayers find themselves in the difficult position that if they don't provide help, that the entire system could come down on top of our heads -- that is the height of irresponsibility.

It is shameful. And part of what we're going to need is for the folks on Wall Street who are asking for help to show some restraint and show some discipline and show some sense of responsibility.

You know, the American people understand that, you know, we've got a big hole that we've got to dig ourselves out of. But they don't like the idea that people are digging a bigger hole, even as they're being asked to fill it up.

And so, you know, we're going to be having conversations, as this process moves forward, directly with these folks on Wall Street, to underscore that they have to start acting in a more responsible fashion if we are to, together, get this economy rolling again.

There will be time for them to make profits. And there will be time for them to get bonuses. Now is not that time. And that's a message that I intend to send directly to them, I expect Secretary Geithner to send to them.

And, you know, Secretary Geithner already had to pull back one institution that had gone forward with a multimillion dollar jet plane purchase at the same time as they're receiving TARP money. We shouldn't have to do that, because they should know better. And we will continue to send that message loud and clear.

Having said that, I am confident that with the recovery package moving through the House and through the Senate, with the excellent work that's already been done by Secretary Geithner, in consultation with Larry Summers and Paul Volcker and other individuals, that we are going to be able to set up a regulatory framework that rights the ship and that gets us moving again. And I know the American people are eager to get moving again. They want to work. They are serious about their responsibilities. I am, too, in this White House. And I hope that the folks on Wall Street are going to be thinking in the same way.

(END VIDEO CLIP)

BLITZER: President Obama feeling some significant anger there at Wall Street right now.

Let's check back with Zain Verjee.

She's got information about the new president's plans to travel outside of the United States.

What are you picking up -- Zain?

ZAIN VERJEE, CNN STATE DEPARTMENT CORRESPONDENT: Wolf, the first travels of the new U.S. president have really great symbolic value and the whole world is waiting.

(BEGIN VIDEOTAPE)

VERJEE (voice-over): The world wants Obama, the road show.

DARRELL WEST, BROOKINGS INSTITUTION: It is important for President Obama to travel around the world. Even though his chief focus has to be on the domestic economy, the global situation very much affects that economy.

VERJEE: Only one foreign trip has been nailed down for President Obama -- Canada, February 19th.

President George W. Bush's first trip was to Mexico on February 16th, 2001.

(VIDEO CLIP)

VERJEE: President Bill Clinton took his first foreign trip in April of 1993 to Vancouver, Canada and met with Russia's leader.

President Obama will have to consider going to key world meetings. Just in April alone, 20 countries with the largest economies meet in London, a NATO meeting in France, the Summit of the Americas in Trinidad and Tobago.

(VIDEO CLIP)

VERJEE: President Obama has also promised to address the Muslim world from a Muslim capital.

WEST: He is the new kid on the block, so every world leader wants to get a piece of him and find out who he is and what his priorities are. Obama talked a lot during the campaign about how he wants the United States to act differently. And so leaders around the world want to see exactly what does that mean.

(END VIDEOTAPE)

VERJEE: Some experts say Mr. Obama's rock star vibe will make his personal diplomacy a much more potent tool and he's going to be in big demand overseas -- Wolf.

BLITZER: No doubt about that.

All right. Thanks very much, Zain.

Moderate Republican senators are named in a new ad pressuring them to vote for President Obama's stimulus plan. Details of who's being targeted.

And Steelers or Cardinals?

The president of the United States has some Super Bowl picks. And he's revealing who he thinks will win the big game, right here in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: These are live pictures you're seeing coming in from Springfield, Illinois. The new governor of Illinois, Pat Quinn, the lieutenant governor, a Democrat, is being sworn in even as we speak right now. This after Rod Blagojevich was removed, convicted and ousted by the Senate in a unanimous 59-0 vote a little while ago. Blagojevich out. Pat Quinn, the new governor of Illinois.

Let's just talk about this briefly with the best political team on television.

Joining us, our senior political analyst, Gloria Borger; Steve Hayes of the "Weekly Standard;" and Candy Crowley, our senior political correspondent.

What a spectacle in Illinois -- a dramatic and shocking development -- the whole series, these weeks leading up to this.

GLORIA BORGER, SENIOR POLITICAL ANALYST: Yes. And, in fact, this last week has perhaps been the most shocking. His lawyer quits. Blagojevich goes on a public relations whirlwind tour and then decides, finally, that he does want to speak before the Senate and gives this rambling speech about what he's done for the -- for the state without ever really defending himself on the issues. So quite remarkable and quite expected that they would throw him out.

BLITZER: Jeff Toobin, our senior legal analyst, said, you know, if he would have made a legal case and gone before the Senate, which had this trial, he might have had an argument. But he decided to just boycott them and go for -- and let them do whatever they wanted. And they did what they wanted.

STEPHEN HAYES, SENIOR WRITER AT "THE WEEKLY STANDARD": Color me skeptical that he would have been able to persuade a lot of people if he had made a legal case...

(LAUGHTER)

HAYES: ...on his own behalf. But I think Jeff is right. He could have at least presented himself in that kind of a setting in such a way that would have made him perhaps a little more sympathetic.

BLITZER: What do you think, Candy, about this -- I called it a spectacle?

I guess that's what it is.

CANDY CROWLEY, CNN SENIOR POLITICAL CORRESPONDENT: I think Illinois lawmakers are the happiest people around at this very moment. We got one statement that began with "Good riddance" from an Illinois lawmaker. I think Democrats are second in their joy, getting this off the thing. And then probably we're the saddest, because it's the best political circus within our time.

(LAUGHTER)

BLITZER: And you'll be interested to know, the new senator from Illinois, Roland Burris, whom Rod Blagojevich actually named to the Senate...

BORGER: Right.

BLITZER: ...released a statement saying: "I stand behind the Illinois state senate's decision today to remove Governor Blagojevich from office."

All right, let's move on and talk about the president of the United States. You saw him. He's all fired up about these bonuses going to some of these Wall Street guys. He's pretty upset about it. And I'm sure a lot of Americans are upset about it, too.

BORGER: I don't blame him. I mean, if there's one easy thing to do right now politically, it's to rail against Wall Street. He's handing over $350 billion to these folks and they just don't seem to get it.

And it was clear, I think, that he was really personally offended by this, Wolf, and angry about it and that there going to be more safeguards so that this cannot happen.

BLITZER: Steve?

HAYES: Oh, I think he should be. I think he should be offended at something that I think Republicans can get behind. We'd all like more questions as to what's happening with the TARP money.

BLITZER: All right. Hold on a second.

let's listen in.

He's being sworn in right now, Pat Quinn, the new governor.

PAT QUINN: That I will support the Constitution of the United States.

UNIDENTIFIED FEMALE: And I will support the Constitution of the State of Illinois.

QUINN: And the Constitution of the State of Illinois.

UNIDENTIFIED FEMALE: And I will faithfully discharge.

QUINN: And I will faithfully discharge.

UNIDENTIFIED FEMALE: The duties.

QUINN: The duties.

UNIDENTIFIED FEMALE: Of the office of governor.

QUINN: Of the office of governor.

UNIDENTIFIED FEMALE: To the best of my ability.

QUINN: To the best of my ability.

UNIDENTIFIED FEMALE: Congratulations, governor.

QUINN: Thank you very much.

BLITZER: All right, there it is. You saw it here. There's a new governor of Illinois, Pat Quinn, the Democrat. The lieutenant governor is now the governor.

Let's continue our conversation on the president of the United States.

I guess it's relatively easy to say, though, these firms, if they're private firms, they should report to their boards, they should report to their stockholders. But if they're getting billions in from the U.S. taxpayers, they have to play by a different set of rules.

CROWLEY: Oh, absolutely. And if you want something that's bipartisan, well, there you go.

BORGER: Right.

CROWLEY: He's got his first, you know, Republican, Democratic -- let's get behind it bill. I mean, this is a -- this is such a no- brainer.

BLITZER: Yes. Well, you know, some of these firms are apparently tone deaf to the image out there.

BORGER: You think?

BLITZER: Yes, I think that's fair to say.

All right. There's a new ad that's running and it's going after some of the more moderate Republicans in the Senate, saying you know what, you should support the president on this economic recovery plan.

Let's listen to this clip.

(BEGIN VIDEO CLIP FROM AD)

OBAMA: The first job of my administration is to put people back to work and get our economy moving again.

UNIDENTIFIED MALE: Tell Congress to support the Obama plan for jobs, not the failed policies of the past.

(END VIDEO CLIP)

BLITZER: All right. Among those Republican senators, these ads are going after their home states. Susan Collins and Olympia Snowe of Maine; moderate Republicans Judd Gregg of New Hampshire; the Alaska senator, Lisa Murkowski; the Iowa senator, Chuck Grassley.

Is it going to make an impact?

HAYES: I think it could. I mean three of those four senators are representing states that voted overwhelmingly for Barack Obama. So I think there's likely support -- a reservoir of support for them.

The problem is I think people are increasingly skeptical that the stimulus is going to stimulate the economy.

BLITZER: And it's obviously a tough issue for the president. He didn't get any Republicans to join him in the House.

CROWLEY: Right. And he'll get very few Republicans in the Senate. I think at least that's the way they seem to be going. And, again, as far as the elections are concerned, we're talking two years from now. I mean, this whole plan could have blown up. It could have not done anything. I mean I agree there's a potential effect. I'm just not sure that we know right at this moment if there is an actual effect.

BORGER: Yes, the...

BLITZER: And the debate starts on Monday. The vote coming up maybe later in the week, maybe the week after. We'll watch it closely.

BORGER: And the White House is lobbying those moderates very heavily.

BLITZER: Yes. And I'm sure it will be different than the House version. And then they'll have to get together and reconcile it, as they say.

Guys, thanks very much.

Let's check in with Lou to see what's coming up at the top of the hour -- Lou, what are you working on?

LOU DOBBS, CNN ANCHOR: Wolf, thank you. Tonight, we're reporting on the president's blistering attack on what he calls shameful bonuses on Wall Street. This president is standing up, but what can he do about it all?

We'll have complete coverage.

Also, the almost $1 trillion so-called stimulus package going to the Senate. But only a small part of that money is for actually fixing our crumbling highways, bridges and railroads. We'll have our special coverage in Lou's Line Item Veto tonight.

And a member of Congress telling homeowners to fight back against foreclosure -- literally telling them to take out squatting in their homes as a response. Congresswoman Marcy Kaptur is among our guests here tonight.

And we'll have more on the Illinois Senate's unanimous decision to convict Governor Blagojevich and remove him from office. The governor is expected -- the ex-governor is expected to talk at the top of the hour. We'll have live coverage for you.

Join us for all of that and more, all the day's news, at the top of the hour -- Wolf, back to you.

BLITZER: All right, Lou.

Thank you.

It's a commercial you won't be seeing during the Super Bowl.

(BEGIN VIDEO CLIP)

JEANNE MOOS, CNN CORRESPONDENT: This seems to be an intentional strategy to get ads rejected.

UNIDENTIFIED MALE: You know, you will never see an ad from PETA that isn't provocative and that doesn't stimulate debate and push some buttons.

(END VIDEO CLIP)

BLITZER: Vegetables -- yes, veggie served up a little bit too steamy for prime time TV.

Jeanne Moos is standing by with a "Moost Unusual" look.

(COMMERCIAL BREAK)

BLITZER: The U.S. government is investigating a former CIA officer in Algeria who's been accused of drugging and raping two women while he held the post. That's from a Justice Department affidavit that's been filed this past fall.

The man has not been charged with a crime and according to the affidavit, he said the sex was consensual.

While this is still under investigation, there are some who already seem to be condemning him.

Listen to the new chairman of the Senate Intelligence Committee, Dianne Feinstein.

SEN. DIANNE FEINSTEIN (D), CALIFORNIA: From what I know about it, it is absolutely intolerable and unacceptable. And I know the Department of Justice is investigating. They have asked the CIA to say very little.

I can sure say something. And that is that this man does not belong in the intelligence service of the United States. And if you cannot be a disciplined professional, you do not belong in the intelligence service of the United States. This is not what that service is about.

(END VIDEO CLIP)

BLITZER: And you can tune in this Saturday to see the full interview with Senator Feinstein. THE SITUATION ROOM on Saturday, 6:00 p.m. Eastern, only here on CNN.

Let's go back to Jack for the Cafferty File -- Jack.

CAFFERTY: The question this hour is how tired are you of hearing about Rod Blagojevich, Norm Coleman, Al Franken and Sarah Palin?

We got a lot of mail.

Terry in Indiana: "Jack, you've got to be kidding? Of all people to ask this question, a media person. How else are you going to get paid? I'm sick of it all, but I keep watching it. What is wrong with me?"

Cy in Virginia writes: "I can't wait to hear more from Senator Franken after he's sworn in. You can take the other three, put them in a sack and drown them like unwanted kittens."

Bob in Nebraska: "The Franken-Coleman issue should not be about them. Rather, the issue should be what's wrong with the governmental process in Minnesota. The Illinois governor is a mental case. He ought to be committed rather than impeached. And Palin was and still is a bad joke that just keeps being repeated."

Mac in Michigan says: "No, I'm not tired of it, Jack. But I'm one of those people -- and so are you, I think -- that enjoys watching politics and politicians. The people you've mentioned here are all providing some comic relief to the serious business of governance. And so far, none of them has done any serious damage to the country that I'm aware of. Every circus needs its clowns."

Matthew in Iowa says: "I'm torn. On the one hand the thought of President Palin terrifies me. On the other hand, she could destroy the Republican Party forever and I'd be the first to yell amen."

Amy in Wisconsin: "Tired? Try exhausted."

And Diane writes: "Dear Jack, I'm glad you're feeling better. Take care."

If you didn't see your e-mail here, you can go to my blog at CNN.com/caffertyfile and look for yours there among hundreds of others.

BLITZER: Me, too, Jack.

Thanks very much.

See you back here tomorrow.

It's too racy for the Super Bowl -- a PETA ad fails to score a touchdown with TV network officials. But viewers are eating it up.

CNN's Jeanne Moss has this "Moost Unusual" look.

(BEGIN VIDEOTAPE)

MOOS (voice-over): Normally you tell kids to eat their vegetables. But now kids are being warned to hide from them.

(BEGIN VIDEO CLIP, COURTESY ILLINOIS INFORMATION SERVICE)

UNIDENTIFIED FEMALE: Please let me forewarn you, you might want to send the kids out of the room.

(END VIDEO CLIP)

MOOS: Women molesting vegetables -- it's the pro-vegetarian commercial banned from the Super Bowl.

(BEGIN VIDEO CLIP FROM "THE LATE SHOW," COURTESY CBS)

UNIDENTIFIED MALE: How could be a vegetable be suggestive?

Do we have a picture of any normal vegetable?

There you are.

(END VIDEO CLIP)

MOOS: The people from PETA, People for the Ethical Treatment of Animals, submitted the commercial to NBC and got a shot by shot rejection memo.

UNIDENTIFIED MALE: I mean, we're talking about things as ridiculous as licking a pumpkin.

MOOS (on camera): But PETA doesn't really mind that its commercial got squashed. Its commercials always get squashed. They have what I call their squash strategy.

Do you know how many times you've been rejected by the Super Bowl?

UNIDENTIFIED MALE: I think this makes the third time. MOOS (voice-over): There was the anti-meat commercial.

(BEGIN VIDEO CLIP FROM PETA AD)

UNIDENTIFIED MALE: With extra sausage.

(END VIDEO CLIP)

MOOS: There was the milk gone wild commercial. Don't freak out, you're only going to glimpse pretend cow udders.

(VIDEO CLIP)

MOOS: Take that, Janet Jackson. But every time PETA gets its Super Bowl commercials rejected, they get a ton of free publicity.

On "The View," Whoopi made out with a head of lettuce.

(VIDEO CLIP)

MOOS: Talk shows debated the issue.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: Do you eat a lot of vegetables, Jim?

JIM BECK, CHRISTIAN COALITION OF AMERICA: Well, not after this. I mean, it's very disturbing.

UNIDENTIFIED FEMALE: Oh, yes. I don't think...

BECK: Who knows where they've been?

(END VIDEO CLIP)

MOOS (on camera): This seems to be an intentional strategy to get ads rejected.

UNIDENTIFIED MALE: You know, you will never see an ad from PETA that isn't provocative.

MOOS (voice-over): Or funny. Take the recent campaign to rename fish sea kittens so people realize fish have feelings, too. PETA says the Super Bowl controversy has led to over a million hits on its Web site, where the banned commercial leads viewers to a serious video on the evils of meat.

Move over Paris Hilton, with your hamburger commercial.

(VIDEO CLIP)

MOOS: It's time for the R-rated vegetable.

(END VIDEO CLIP)

(BEGIN VIDEO CLIP FROM "THE O'REILLY FACTOR," COURTESY FOX NEWS) BILL O'REILLY, HOST: I hope those vegetables were of legal age.

(END VIDEO CLIP)

(BEGIN VIDEO CLIP FROM "THE LATE LATE SHOW," COURTESY CBS)

UNIDENTIFIED MALE: If I want to see a beautiful woman get it on with a vegetable, I'll look through the window at Hugh Hefner's house.

(END VIDEO CLIP)

MOOS: Hope all this doesn't upset the People for the Ethical Treatment of Vegetables.

(on camera): The bottom line -- PETA likes to get shot down.

Jeanne Moos, CNN, New York.

(END VIDEOTAPE)

BLITZER: Thank you, Jeanne.

President Obama may be rooting for one player in the Super Bowl on Sunday.

(BEGIN VIDEO CLIP)

OBAMA: I have to say, you know, I wish the Cardinals the best. You know, Kurt Warner is a great story and he's closer to my age than anybody else on the field.

(END VIDEO CLIP)

BLITZER: So which team is the president rooting for in Sunday's big game?

You're going to hear, in his own words, what he thinks.

The president on the Super Bowl -- that's coming up next.

(COMMERCIAL BREAK)

BLITZER: Let's take a look at some of the "Hot Shots" coming in from our friends over at the Associated Press -- pictures likely to be in your newspapers tomorrow.

In Greece, truck drivers kick a plastic bottle after farmers set up protest blockades.

In Croatia, Hungarian and German athletes fight for possession during the Men's Handball World Championship.

In France, a demonstrator takes to the streets wearing a mask of the president, Nicolas Sarkozy.

And in England, the Duchess of Cornwall meets a future police dog at the police dog training school.

Some of this hour's Hot Shots -- pictures worth a thousand words.

He stumbled out of the gate when he sent GOP members a parody song called "Barack the Magic Negro." Now, Chip Saltsman is running out of -- is out of the running in the race to become the next chairman of the Republican National Committee. An RNC aide says the former campaign manager for Mike Huckabee did not file by today's deadline. Five candidates remain in the post for chairman of the RNC. The election tomorrow. We'll have coverage here in THE SITUATION ROOM.

President Obama is picking sides. Today, he was asked his favorite between the Arizona Cardinals and the Pittsburgh Steelers for the Super Bowl this Sunday.

Listen to what he said.

(BEGIN VIDEO CLIP)

OBAMA: I have to say, you know, I wish the Cardinals the best. You know, Kurt Warner is a great story and he's closer to my age than anybody else on the field. But I am a long time Steelers fan. Mr. Rooney, the owner, was just an extraordinary supporter during the course of the campaign. You know, Frank O. Harris was campaigning for me in Pittsburgh. So...

UNIDENTIFIED MALE: The coach signed up with you, too. (INAUDIBLE).

OBAMA: Right. Coach Tomlin was a supporter. So I -- you know, I wish the best to the Cardinals. They've been long-suffering. It's a great Cinderella story. But other than the Bears, the Steelers are probably the team that's closest to my heart.

(END VIDEO CLIP)

BLITZER: All right. Don't forget this Saturday, THE SITUATION ROOM airs 6:00 p.m. Eastern and every Saturday. We're on six days a week right now.

Thanks very much for watching.

Let's go to Lou in New York -- Lou?