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THE SITUATION ROOM

President Obama Meets With Canadian Prime Minister; GM Jobs on the Line

Aired February 19, 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: And, to our viewers, you're in THE SITUATION ROOM.

Happening now: President Obama steps cautiously in his first trip outside the United States since taking office -- this hour, the tough issues on the table in Canada and what the president took home with him.

And breaking news: The FBI tracks down a missing financier accused of a massive fraud scheme. There are new details on that and the money trail linking Allen Stanford to big names here in Washington.

And busted -- a bronze figure of a historic British figure gets booted from the Oval Office. Some are calling it a disgrace -- all that coming up, plus the best political team on television.

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

This hour, President Obama returns to Washington, after confronting tough challenges with one of America's closest allies. That would be Canada. It was Mr. Obama's first test out there on the global stage.

Let's go to our White House correspondent, Dan Lothian. He's been traveling with the president in Ottawa.

How did it go, Dan?

DAN LOTHIAN, CNN WHITE HOUSE CORRESPONDENT: Well, Wolf, this was not a major summit, but it was a chance for both leaders to have this working lunch, get a chance to get to know each other, and start drilling down on some of the issues that impact both countries.

(BEGIN VIDEOTAPE)

LOTHIAN (voice-over): President Obama didn't go far on his first foreign trip, but he did cover a lot of ground, making a commitment with Prime Minister Stephen Harper to tackle the global economic downturn.

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: The financial crisis is global. And so our response must be global.

LOTHIAN: Announcing a new clean energy initiative. STEPHEN HARPER, CANADIAN PRIME MINISTER: That will reduce greenhouse gases and combat climate change.

LOTHIAN: And showing respect for Canada's decision to pull its combat troops out of Afghanistan within two years, even as the U.S. sends in more forces.

OBAMA: I certainly did not press the prime minister on any additional commitments beyond the ones that have already been made.

LOTHIAN: The U.S. and Canada are the largest global trading partners, with more than a billion dollars in cross-border commerce each day. So, trade was also on the table.

But even though the president got a warm reception with flattering signs, at times this trade partnership can be an uncomfortable relationship. As a candidate, Mr. Obama said this about the North American Free Trade Agreement that some blame for thousands of lost factory jobs in the U.S.

OBAMA: I will make sure that we renegotiate.

LOTHIAN: Now he's much more diplomatic.

OBAMA: My hope is, is that there's a way of doing this that is not disruptive.

LOTHIAN: But Prime Minister Harper made it clear where he stands.

HARPER: We can address some of these concerns, which I understand, without, you know, opening the whole NAFTA and unraveling what is a very complex agreement.

LOTHIAN: And concern, too, over the buy-American provision in the recent stimulus bill. The president tried to put his neighbors to the north at ease.

OBAMA: I want to grow trade, and not contract it.

LOTHIAN: And a lighter moment -- after the president left parliament, he stopped at a craft market to buy a snow globe, key chain and other gifts for his family.

(END VIDEOTAPE)

LOTHIAN: Like the U.S., Canada here is also going through an economic downturn, so the prime minister is pushing his own economic stimulus plan. It's way smaller than the $787 billion in the U.S., but both leaders did get a chance to talk about ways to jump-start the economy here -- Wolf.

BLITZER: All right, we will see if it works. Dan, thank you.

Right now, Canada has over 2,800 troops deployed in Afghanistan. It's the fifth largest presence there. But that's just a small fraction of the U.S. contingent.

The bulk of the Canadian troops are positioned in Afghanistan's largest province, Kandahar, in the southern part of the country -- 108 Canadian troops have been killed in Afghanistan since October 2001. That's compared to 647 U.S. troop deaths.

As the U.S. prepares to increase its military strength in Afghanistan, and Canada moves forward with plans to leave, I asked the Canadian prime minister, Stephen Harper, what the final outcome is likely to be.

(BEGIN VIDEOTAPE)

BLITZER: What is the definition of victory, from your perspective?

HARPER: Well, I think a lot of people in the past have been suggesting that, you know, victory is the complete defeat of the insurgency and the replacement of a failed state in Afghanistan with a modern liberal democracy.

I don't think that's realistic. I think what we should be aiming for in Afghanistan is a viable state that respects, you know, obviously some democratic norms, but I think ultimately the insurgency will last a long time.

Afghanistan, through most of its history has been an untamed country. So I think the idea we're going to wipe out an insurgency is completely unrealistic. What we want is a central government that can maintain day-to-day responsibility for its own security. I think that's what we should define victory as.

(END VIDEO CLIP)

BLITZER: And you can see much more of my exclusive interview with the prime minister of Canada, Stephen Harper, on the Saturday edition of THE SITUATION ROOM. That airs Saturday, 6:00 p.m. Eastern, right here on CNN.

Back here in Washington, President Obama still has some big holes to fill in his Cabinet. His choice for labor secretary still hasn't been confirmed. He's had two commerce secretary nominees drop out, as well as his choice for health and human services secretary.

Right now, though, one name is mentioned a lot about a possible contender for the health job.

Let's bring in our national political correspondent, Jessica Yellin. She's doing some digging.

What are you hearing?

JESSICA YELLIN, CNN CONGRESSIONAL CORRESPONDENT: Wolf, my sources at the White House are being very cautious about saying even who their leading picks are for various Cabinet positions because so many of the president's appointees have backed out. This is far from a done deal, but sources do tell me that Kathleen Sebelius, the governor of Kansas, is the leading candidate to run the Department of Health and Human Services.

(BEGIN VIDEOTAPE)

YELLIN (voice-over): Health care reform is at the top of President Obama's agenda. He's already signed a bill expanding health coverage for kids and plans to lay the groundwork for further reform next week. All he needs is a secretary of health and human services.

Could this be his woman?

GOV. KATHLEEN SEBELIUS (D), KANSAS: And, if you come from Kansas, go home and vote.

(CHEERING AND APPLAUSE)

YELLIN: Kansas Governor Kathleen Sebelius was an early supporter of then candidate Obama.

OBAMA: Which may explain why I just love your governor in Kansas.

YELLIN: A rare breed, she's a popular Democratic governor in a very red state. She has a history of working with Republicans. She's posed for "Vogue" -- the photo made a splash in "The Kansas City Star" -- and delivered the Democratic response to President Bush's last State of the Union address. Her focus? Health care reform.

SEBELIUS: We know that we're stronger as a nation when our people have access to the highest-quality, most affordable health care.

YELLIN: As state insurance commissioner, Sebelius fought Blue Cross/Blue Shield to keep premiums down. And, as governor, she has pushed for a cigarette tax to finance more health coverage. A Catholic, she's drawn the wrath of the church for her views on abortion.

Progressive groups are pulling for her. Ron Pollack has encouraged the White House to select Sebelius.

RON POLLACK, EXECUTIVE DIRECTOR, FAMILIES USA: She represents the knowledge, background, caring that I think is necessary for that position.

YELLIN: But critics point out she has no experience working with Congress, has not gotten major health care reform passed in her state, and insist she has mismanaged Kansas' budget.

CHRISTIAN MORGAN, EXECUTIVE DIRECTOR, KANSAS REPUBLICAN PARTY: What she's got is a problem of leadership. Number one, she's never done anything to help the issue of health care in the state of Kansas.

(END VIDEOTAPE) YELLIN: Well, my sources also tell me that if Sebelius were to get the job, she likely would not get the title of health care czar, which Tom Daschle was going to get. That role overseeing health care reform would likely be handled by others on the White House staff.

Now, Wolf, Sebelius' office tells me that, right now, she is just now focused on doing her job as governor. And, of course, it's not a done deal.

BLITZER: Well, that's what they always say.

YELLIN: They always say.

BLITZER: Thank you. Thanks very much, Jessica, for that.

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

JACK CAFFERTY, CNN ANCHOR: What's that old line? If they accept the job, it's never because I want to spend less time with my family.

BLITZER: Right.

CAFFERTY: But, if they leave the job, it's because I want to spend more time with my -- Congress' approval rating higher than it's been in almost two years. It's not like they're suddenly loved across this land of ours, but they have managed to crawl out of the gutter, barely.

The latest Gallup poll shows Congress' rating jumping from 12 points -- or jumping up 12 points, I should say, from last month -- 31 percent of Americans now approve of the job Congress is doing. That's less than a third, but, hey, take what you can get. This compares to 19 percent who felt that way in January -- 31 percent is a long way from stellar.

But Congress' approval ratings have pretty much hovered below 30 percent since late 2005, and more recently have been even more dismal at around 20 percent. They hit an all-time low, you may recall, of 14 percent last summer under the astute leadership of Nancy Pelosi and Harry Reid.

Gallup suggests the increase this month is due to Democrats looking more favorably upon Congress since the inauguration of President Obama. Democrats' approval of Congress went from 18 percent in January to 43 percent this month.

But, not unexpectedly, Republicans are now less likely to approve of Congress than last month. It's possible more Americans are giving a thumbs-up to Congress because of the work they did on the stimulus package, getting that thing through both houses of Congress fairly quickly, by congressional standards.

Here's the question: Why has Congress' approval rating suddenly improved, do you suppose? Go to CNN.com/caffertyfile. Post a comment on my blog.

BLITZER: Jack, see you in a few moments. Thank you.

Listen closely. President Obama did something. And this is part of the reaction.

(BEGIN VIDEO CLIP)

NILE GARDINER, MARGARET THATCHER CENTER FOR FREEDOM DIRECTOR, HERITAGE FOUNDATION: It's being viewed in the U.K. as very insulting and a very insensitive move by -- by the White House.

(END VIDEO CLIP)

BLITZER: Is President Obama's action really that offensive? You're going to find out what happened, and you decide.

Also, can the president change the opinions of those who have negative perceptions of the U.S.?

And he was missing. Now he's been found. The billionaire accused of -- quote -- "a fraud of shocking magnitude," you are going to find out where he was found and what happened.

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

(COMMERCIAL BREAK)

BLITZER: So, what is the U.S. image around the world right now?

I want to go to our senior political analyst, Bill Schneider.

Bill, has the new president turned America's image around the world around?

WILLIAM SCHNEIDER, CNN SENIOR POLITICAL ANALYST: Well, I would call it step one, many more to go.

(BEGIN VIDEOTAPE)

SCHNEIDER (voice-over): In 2004, President Bush went to Canada and faced massive protests. This week, President Obama went to Canada and faced adoring crowds. The new president wants to transform the image of the United States in the world.

OBAMA: In Europe, the view that America is part of what has gone wrong in our world, rather than a force to help us make it right, has become all too common.

SCHNEIDER: Do Americans believe world leaders respect the president of the United States? Gallup asked that question last year, when George W. Bush was president. Only 24 percent of Americans said yes. Now, with Obama in office, two-thirds of Americans believe the president is respected by other world leaders.

But does the public think President Obama has changed the image of the country? Last year, 43 percent of Americans thought the United States rated favorably in the eyes of the world. That has not changed much. Americans and the rest of the world are waiting to see what kinds of policy changes President Obama will make. The biggest change so far? Closing the detention center in Guantanamo. More changes have been promised.

OBAMA: This is the moment we must help answer the call for a new dawn in the Middle East. This is the moment when we must come together to save this planet.

SCHNEIDER: There are some thorny problems ahead, like Afghanistan, where President Obama has announced an increase in the U.S. troop commitment.

When asked whether Canada should do the same, Canadians were opposed by nearly 2-1.

(END VIDEOTAPE)

SCHNEIDER: The Pew Global Attitudes survey found that in 14 out of 19 countries polled, favorable opinion of the United States declined between 2002 and 2008, sometimes sharply, as in Indonesia, where President Obama spent part of his childhood. The world loves President Obama. But does the world love the United States? That could take some time -- Wolf.

BLITZER: We will see what happens.

Bill Schneider, thank you.

The United States and Britain certainly share one of the closest relationships among any two nations in the world. But something President Obama has done is causing some Britons to wonder, where is the love?

Let's go back to Zain Verjee. She's looking at this story for us.

Zain, where is the love?

ZAIN VERJEE, CNN STATE DEPARTMENT CORRESPONDENT: Indeed, where is it, Wolf? The president made a decision: Lincoln's in, and Churchill's out.

(BEGIN VIDEOTAPE)

VERJEE (voice-over): Abraham Lincoln beat out Sir Winston Churchill for a prime spot in President Obama's Oval Office. A bronze bust of the famous British prime minister has been sent back, disrespectful, says Nile Gardiner of the conservative Heritage Foundation.

GARDINER: My view is that this is -- you know, it's a -- it's a real disgrace, actually. It sends completely the wrong signal toward Britain. It's being viewed in the U.K. as very insulting and a very insensitive move by -- by the White House.

VERJEE: The British loaned it to President Bush in a show of solidarity after 9/11, to be returned at the end of his term. But they have told the White House they're welcome to keep it for another four years.

GARDINER: I do believe the bust should be returned to the Oval Office. There's no reason why you can't have busts of both Lincoln and Churchill sitting in the Oval Office.

VERJEE: Churchill is sitting at the British Embassy residence right now. The White House has no comment. But the Britain Embassy tells CNN that they understand the decision and enjoy a good relationship with the Obama administration.

Despite the Oval Office decorating changes, the U.S. has special ties with Britain. Britain has thousands of troops fighting with Americans in Iraq and Afghanistan.

(END VIDEOTAPE)

VERJEE: And what would Sir Winston himself say about all this, Wolf? Well, he was once quoted as saying, everyone has his day, and some days last longer than others -- Wolf.

BLITZER: So, what's going to happen to that bust of Winston Churchill?

VERJEE: Well, a British Embassy spokesman told me that they're going to keep the sculpture here in Washington and it's going to be staying at the ambassador's residence. So, if you're invited to dinner, you can see it.

BLITZER: I will look forward to it.

(LAUGHTER)

BLITZER: Thank you, Zain Verjee, reporting.

It turns out that that Texas financier who allegedly bilked investors out of billions and billions of dollars has connections with some of the country's most powerful politicians. We are going to tell you what we know.

Also, Washington Democrats and scandal -- are they becoming part of the same culture of corruption they accused Republicans of adopting?

And GM says 47,000 jobs may be on the chopping block. John King standing by to take us inside one plant to see how workers are dealing with the news.

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

(COMMERCIAL BREAK)

BLITZER: There are new developments in the case of that Texas financier accused of running away or at least embezzling some $9 billion. What's going on here, Brian Todd?

BRIAN TODD, CNN CORRESPONDENT: Well, Wolf, late today, we got word that the FBI has located Allen Stanford in Fredericksburg, Virginia, and served him papers related to the civil charges filed against him by the Securities and Exchange Commission.

That agency is charging him in a massive fraud case, as Wolf just mentioned. Now, Stanford has no criminal charges pending against him and is not in custody. But we are learning new details on how Stanford tried to insert himself into Washington politics.

He gave money to President Obama and to John McCain at some point. But they and some very other powerful people in this town are now moving away from -- moving as far away from Allen Stanford as they possibly can.

(BEGIN VIDEOTAPE)

UNIDENTIFIED MALE: Congressman Nancy Pelosi.

TODD (voice-over): A warm embrace between Allen Stanford and House Speaker Nancy Pelosi at last summer's Democratic Convention, this video posted on Stanford's company Web site a public display of the efforts by the controversial financier to be a major player in Washington.

SHEILA KRUMHOLZ, CENTER FOR RESPONSIVE POLITICS: Stanford and his firm definitely had deep reach in Washington, giving $2.4 million back to 2000 and spending a lot more than that on lobbying.

TODD: Sheila Krumholz's Center for Responsive Politics has compiled lengthy documentation on money that Stanford, his employees or his political action committee gave to Washington's most powerful. Pelosi didn't get any money directly from Stanford.

But the Democratic Congressional Campaign Committee, which Pelosi works with to get Democrats elected to Congress, got more than $200,000. Barack Obama got nearly $32,000, money since given to charity, John McCain more than $28,000. Members of Congress who sit atop the major financial committees, like Senators Chris Dodd and Richard Shelby, Congressman Charles Rangel, all got significant contributions from Allen Stanford or those around him.

They all say they're giving the money to charity. But there are other questions.

KRUMHOLZ: Whether anyone in Congress or elsewhere stepped in to put in a good word for Stanford Financial Group with the SEC to ensure that -- or to request that they be given a break and not be subjected to more aggressive regulation.

TODD: Krumholz doesn't have evidence of that. And aides to the president and all those members of Congress say they don't believe any appeals were made. But Krumholz believes the Securities and Exchange Commission has been slow to investigate Stanford. The SEC this week charged him with defrauding clients of more than $9 billion. But a former employee told "The Houston Chronicle" he saw problems awhile ago.

CHARLES RAWL, FORMER STANFORD FINANCIAL EXECUTIVE: In mid-2006, I noticed that the performance of my clients' accounts was not tracking the published advertised returns.

(END VIDEOTAPE)

TODD: Contacted by CNN, SEC officials deny being slow to investigate Allen Stanford. They say this is a very complicated case involving difficult matters of jurisdiction and it took awhile to gather enough evidence to bring a strong case.

Now, when we asked whether any members of Congress contracted them on Stanford's behalf, an SEC official said he did not know. Our repeated efforts to reach Allen Stanford have been unsuccessful Wolf,

BLITZER: It wasn't just Washington players that he wanted to get close to either, was it?

TODD: No. "The London Times" has compiled of others who Allen Stanford tried to get close to.

You have got Britain's Prince Charles, who hosted a polo event sponsored by Stanford. Golfer Tiger Woods hosted a golfing event sponsored by Allen Stanford. Vijay Singh, another star golfer, has been sponsored by him. Tennis star Jim Courier and soccer star Michael Owen has been hired by Stanford for other promotional events.

He's got his reach all over the world and in many different areas.

BLITZER: We will see how this story plays out. Brian, thank you.

President Obama says the U.S. could not have a better friend and ally than Canada.

(BEGIN VIDEO CLIP)

OBAMA: I expect that, four years from now, the U.S.-Canadian relationship will be even stronger than it is today.

(END VIDEO CLIP)

BLITZER: All right, stand by to hear the president in his own words on the challenges Americans and Canadians are facing together.

Plus, we will take you to a General Motors plant in Michigan where thousands of jobs may be cut. Is it proof that GM needs a bigger federal bailout?

And the new Republican Party chairman says it's going to be off the hook. Can he make the GOP seem appealing to the hip-hop crowd? The best political team on television is all over that.

(COMMERCIAL BREAK)

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

Happening now: a dismal day on Wall Street. The Dow tumbled below 7500, closing at its lowest level in more than six years -- weighing down the market, steep drop-offs in financial and technology stocks.

Hillary Clinton in South Korea, and she's eying the communist North -- America's top diplomat meeting with her South Korean counterpart, topping their agenda, North Korea's nuclear program and its bid to launch a long-range missile.

And under arrest, the suspect in a string of arson fires in Pennsylvania, his bail, $9 million -- all of this, plus the best political team on television.

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

America's neighbor to the north warmly embracing President Obama.

Let's get some more on our top story. The president visited Canada for the very first foreign trip of his presidency. He and the Canadian prime minister, Stephen Harper, met to discuss very important issues involving the two nations. And they answered questions from reporters. Listen to this.

(BEGIN VIDEO CLIP)

QUESTION: Mr. President, during your meetings today, did you discuss the possibility of Canada stepping up its stimulus plans?

And secondly, for both of you: What do you think the Canada-U.S. relationship will look like in four years? What will the auto sector look like? Will the border be thicker or thinner? And will you have a carbon market?

OBAMA: You stuffed about six questions in there.

(LAUGHTER)

OBAMA: Were you talking to Jonathan? Is that...

(LAUGHTER)

QUESTION: (OFF-MIKE)

OBAMA: Yes, I will bet.

(LAUGHTER)

OBAMA: Well, first of all, I will answer your last question first. I expect that four years from now, the U.S.-Canadian relationship will be even stronger than it is today. I expect that you will see increased trade. I think we will see continued integration of efforts on energy in various industries. And I think that's to be welcomed.

I am a little biased here because I have got a brother-in-law who's Canadian and I have two of my key staff people who hail from Canada. And I love this country and think that we could not have a better friend and ally.

And, so, I'm going to do everything that I can to make sure that our relationship is strengthened.

You mentioned a couple of specific issues. The idea of thickening of borders, one of the things that I would like to see is -- and we -- Prime Minister Harper and I discussed this -- how we can use some of our stimulus and infrastructure spending that is already being planned around potentially easing some of these bottlenecks in our border.

Now, we've got very real security concerns, as does Canada. But I think that it is possible for us to balance our security concerns with an open border that continues to encourage this extraordinary trade relationship in which we have $1.5 billion worth of trade going back and forth every single day.

With respect to the auto industry, obviously, we are concerned -- you know, we're deeply concerned about the current state of the North American auto industry.

It is an integrated industry.

When we provided our initial federal help to the auto industry, Prime Minister Harper stepped up and provided assistance that was commensurate with the -- the stake that Canada has in the auto industry.

We have just received the report back from G.M. and Chrysler, in terms of how they intend to move forward. My economic team is in the process of evaluating it.

One thing we know for certain is that there's going to have to be a significant restructuring of that industry. And as that restructuring takes place, one in which all parties involved -- shareholders, creditors, workers, management, suppliers, dealers -- as all of those parties come together to figure out what is a sustainable and vibrant North America auto industry, it's going to be very important for our government to coordinate closely with the Canadian government in whatever approach that we decide to take. And we are committed to doing that.

And finally, with respect to stimulus, I think that as Prime Minister Harper mentioned, Canada has put in place its own stimulus package. We obviously are very proud of the Recovery Act that I recently signed, not only, because it provides a short-term boost to the economy and provides relief to families that really need help, but I think it also will lay the groundwork for long-term growth and prosperity. We were talking earlier about the issue of the electric grid. You know, the potential that exists for creating ways of delivering energy from wind and solar across vast plains to get to urban areas and populated areas is enormously promising. That's why we are investing billions of dollars to help jump-start that process.

And so we think we've taken the right approach to not only get the economy moving again and to fill domestic demand, as well as global demand, but, also, I think Prime Minister Harper is taking the same approach.

(END VIDEO CLIP)

BLITZER: All right. That's the president of the United States and the prime minister of Canada in Ottawa earlier today.

I want to go to Lansing, Michigan right now.

Our chief national correspondent, John King, is out there talking to people who are suffering. There's a lot of autoworkers potentially getting ready to lose their jobs -- John.

JOHN KING, CNN CHIEF NATIONAL CORRESPONDENT: And, Wolf, you just heard the president of the United States talk about all of the stakeholders in the auto industry need to be involved in this restructuring plan now before the administration. We're out here to touch base with many of them. And part of our day today was at a Saturn dealership here in the Lansing area. And Sherrill Freeborough owns that Saturn dealership. She owns two of them in the Lansing area.

Now, G.M. has announced, as part of this restructuring plan, it will eliminate the Saturn brand. It will eliminate the Pontiac brand three years down the road.

So we talked to this small businesswoman. She says business is tough anyway, because Americans simply aren't buying new cars right now. She says they are buying used cars, but not new cars.

She will lose her relationship with General Motors down the road. Saturn dealers hope to sell another product -- maybe cars made in China, maybe cars made in India. But Sherrill Freeborough conceding to us that in this very difficult time, when she is about to lose her partner in G.M., that she goes home at night quite stressed and quite uncertain.

(BEGIN VIDEO CLIP)

SHERRILL FREEBOROUGH, SATURN DEALERSHIP OWNER: I'm a new owner. My husband still can't breathe. He still asks me what are we doing, I thought you were just going to sell cars. So, yes, everything in my life -- I can't have a bad day and go home and tell him. I have to be happy when I go home, because everything we have is wrapped up in this company.

(END VIDEO CLIP) KING: We also spent some time on the floor of the assembly line at the Lansing Grand River General Motors facility here. They make beautiful Cadillacs there at that facility. There were once two shifts at that factory, now just one. And some of the workers we saw today say they will lose their jobs just five weeks from now.

Across town, there is another G.M. assembly plant that not long ago had three shifts running. It is now down to one shift -- workers there facing a very uncertain future.

And, Wolf, we stopped by a UAW hall here, as well. Again, workers used to be on three shifts in one factory, two shifts in another. They're now down to one shift. They're all hoping that the General Motors restructuring goes through -- that the government sends their company billions more. But they think it will be a long time. And as the president often says, you hear from all of the workers out here in Michigan. They expect things to get far worse before they get better.

So a very difficult time in this state, Wolf. It has been in the recession the longest of all of the states. The highest unemployment rate in the country right here in Michigan, 10.6 percent -- Wolf.

BLITZER: And even as they go through a restructuring, thousands of those workers, in the process, are going to be losing their jobs.

KING: That's exactly right.

KING: John King in Lansing.

He's going to have a lot more on this story coming up Sunday morning on his show, "STATE OF THE UNION." It airs 9:00 a.m. Eastern to 1:00 p.m. Eastern. "STATE OF THE UNION" with John King every Sunday morning.

The head of the Republican Party thinks there's a future for the GOP in hip-hop -- why Michael Steele thinks his principles will appeal to that community.

And they accused Republicans of living in a culture of corruption. Now Democrats are facing some embarrassing problems of their own. The best political team on television is here to weigh in.

(COMMERCIAL BREAK)

BLITZER: All right. You're looking at a live picture of Air Force One back on the ground now at Andrews Air Force Base outside of Washington. The president of the United States getting ready to get off that plane and head back over to the White House after his day- long visit to Ottawa, Canada for talks with the Canadian prime minister.

Let's get to our panel, our senior political analyst, Gloria Borger is here; our CNN political contributor Steve Hayes, of "The Weekly Standard;" and our CNN political analyst, Roland Martin. They're part of the best political team on television.

Let me throw the first question, Roland, to you.

Michael Steele the new chairman of the Republican Party, he says this in "The Washington Times." He says: "We want to convey that the modern day GOP looks like the conservative party that stands on principles. But we want to apply them to urban suburban hip-hop settings."

Is he going to make an inroad in that hip-hop crowd for the Republicans?

ROLAND S. MARTIN, CNN POLITICAL ANALYST: Boy, that's going to be a tough one there. A little flavor in your ear for Michael Steele. But you know what, though, look, I think one of the things that Michael Steele is saying is that we can't be the old fuddy-duddy party of white guys from the South. And they have to have a message that certainly appeals to the New Jack generation, if you will.

I'll tell you, Wolf, there is an opportunity here, because you have folks who are in the post-civil rights movement. I call them post-civil rights movement babies, folks like me, who are 40 years old, who are Gen-X, who are hip-hop children, who are not wedded to the Democratic Party. But they have to have a message that appeals to them that's not ideological.

BLITZER: What do you think about that, Steve?

STEPHEN HAYES, SENIOR WRITER "THE WEEKLY STANDARD": Well, when I heard him make that appeal to the hip-hop generation, I had this flash of Orrin Hatch on the Senate floor wearing the Flavor Flav clock around his neck.

(LAUGHTER)

HAYES: It was really not an attractive picture. Look, I actually think he's right. I mean, it's good to reach out. And the thing that heartened me most in his comments that you just read was that, you know, the Republican Party needs to be a conservative party, it needs to stand on its principles. But, yes, absolutely they should find as many ways as possible to reach out and to sell the message in a different way -- to have different messengers and to be as appealing as they can to a broad section of the country.

BLITZER: As attractive as Michael Steele, Gloria, might be, to some, this might sounds like mission impossible.

GLORIA BORGER, CNN SENIOR POLITICAL ANALYST: Well, you know, it's very difficult, because right now, quite frankly, the Republican Party looks more like the Confederacy, Wolf, than anything else. I mean they have no Republican representatives in the House, for example, from the half dozen New England states. And they're trying -- you know, I give Michael Steele credit here.

But there has to be a message beyond we voted 100 percent against the stimulus package and we're against President Obama.

BLITZER: Does the -- is the GOP, Steve... MARTIN: And, Wolf...

BLITZER: ...largely just a party of the South right now?

HAYES: No. I think in fact one of the places that the Republicans were scared in the last election was in places like Virginia, like North Carolina. There are signs that Republicans are losing their grip on that Southern base. And it's one of the reasons why it makes a lot of sense to reach out and appeal beyond that, as the -- as sort of the core of the party.

MARTIN: And, Wolf...

(CROSSTALK)

MARTIN: ...folks that are listening...

BLITZER: I just want to tell our viewers the president is now walking over to Marine One from Air Force One. He's on the ground.

But go ahead.

MARTIN: For the folks who are watching and listening, understand this. When you talk about hip-hop, 80 percent of the kids who buy hip- hop music are white kids. And so when Michael Steele talks about appealing to that generation, he is talking about appealing to a diverse generation ethnically -- people who go beyond the traditional party.

Obama was successful in talking to them, speaking their language, because, frankly, he has a foot in the baby boomer generation and Generation X.

And so Steele is not talking about just talking to African- Americans and Hispanics. He's saying let's talk to white kids, as well, who are turning us off.

BORGER: But he's talking about younger voters. And that's the real...

MARTIN: Yes. Absolutely.

BORGER: And that's a real problem for the Republican Party, as well, right now. Because, obviously, President Obama kind of cornered that market in the last election. And Republicans have to figure out a way to reach out to younger voters. And quite frankly, they haven't done it yet.

HAYES: But you can't build...

BLITZER: Gloria...

HAYES: You can't build a party based on reaching out to the youth vote. I mean young voters are notoriously flaky and regularly fail to show up and -- show up and vote. I think Obama benefited because he did -- he reached out in a way that was really unprecedented and was effective in a way that nobody else has been in the past.

MARTIN: You know what, Steve?

Your response is why Republicans will lose. Because what happens is they always say young voters are flaky. But what you have now, though, you have candidates who are having to talk their language, maximizing social networking. You're having a new generation -- when Obama talks about change and getting involved, he is trying to bring in the public service there.

And so Republicans walk around saying oh, they're not going to vote?

Trust me, they're going to get shocked every time. And when they lose, they can't say...

HAYES: That's just not the case.

MARTIN: Well, we blew them off.

BORGER: And...

HAYES: I'm sorry. That's just not the case.

MARTIN: OK. OK.

HAYES: It's just...

MARTIN: All right.

HAYES: It's just not the case. We hear...

MARTIN: Go right ahead and do it.

HAYES: We hear a growing or a booming youth vote every single time there's an election, whether it's presidential or off year. This time, they actually showed up.

Will they in the future?

I'm skeptical. It doesn't mean they shouldn't try to reach out...

MARTIN: OK. Well, then be skeptical.

BORGER: Well -- well, but they...

HAYES: But it's not a way to build a party.

BORGER: It depends on whether they feel they have a stake in their government and in the programs that their government is producing or in the candidates that their particular party is producing.

MARTIN: Yes.

BORGER: If there are younger candidates coming out of the Republican Party, if it becomes more diverse as a party, then it can attract some of those -- some of those voters Michael Steele is talking about. But right now, he's got a big job.

BLITZER: Roland, very quickly, this culture of corruption the Democrats used to rail at the Republicans. But now there are a few Democrats who are facing this so-called culture of corruption, led by the Illinois senator, Roland Burris.

How worried should Democrats be?

MARTIN: Look, understand, people rebel immediately when it comes to corruption. And frankly, the Democrats should be taking a tough stand and saying we are going to get rid of these cancers in our party. The last thing you want is for the perception to be you accept the culture. And so they're going to have to confront Congressman Charlie Rangel and clean it up. They're going to have to confront what's happening with Roland Burris.

If they're allowed to get out of hand, that could be trouble for 2010 and even 2012.

BORGER: And I think this is -- you know, this is a problem for President Obama, too, Roland Burris. Because Roland Burris is the senator who was sent to replace him. And the Senate only decided -- Senate Democrats only decided to seat him if he promised to testify truthfully and fully before the Illinois State Senate. And guess what, it looks like he didn't.

So they've got a problem.

BLITZER: All right, guys, we've got to leave it right there.

Thanks to all of you.

All right. Kitty Pilgrim is filling in for Lou tonight.

She's coming up at the top of the hour -- Kitty, what are you working on?

KITTY PILGRIM, CORRESPONDENT: Thanks, Wolf.

Coming up at 7:00 Eastern, we're going to have more on President Obama's first foreign trip to Canada. The president putting one of his main campaign promises on hold and avoiding any controversy over so- called free trade and NAFTA. We'll have complete coverage of that.

Also, a newspaper cartoon becomes a new flashpoint in the controversy over race, politics and free speech. We'll examine the escalating showdown over a cartoon in "The New York Post."

Also, startling new revelations about the owner of a chimpanzee that brutally attacked a woman and was shot dead by police. We'll tell you what the chimpanzee owner is saying and ask how it's possible for anyone to keep such a dangerous animal as a pet.

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

BLITZER: Thanks very much, Kitty.

We'll see you in a little while.

A rock band takes up a very important cause.

(BEGIN VIDEO CLIP)

JOEL MADDEN, MUSICIAN: The effective this conflict is women being raped, children being hurt, people dying -- you know, the deadliest war, like I said, since World War II.

(END VIDEO CLIP)

BLITZER: And now they want you to know your cell phone, your iPod and more could be helping to fund the fighting.

Plus, our question to you this hour, why has Congress' approval rating suddenly improved?

Jack Cafferty and your e-mail.

And a lot more, when we come back.

(COMMERCIAL BREAK)

BLITZER: Let's get right to Jack for the Cafferty File -- Jack.

CAFFERTY: Wolf, from the file marked "will miracles never cease," the question is: Why has Congress' approval rating suddenly improved?

Gallup says they're now up to 31 percent, which is a moon shot for them.

Terry: "They're working more than they have in the last 29 years. At this rate, they may actually earn part of their salaries. But they have a long way to go to actually earn all of it."

Nelly in Florida: "Obviously, because of Barack Obama. Look what he's done in four weeks. He's moving, Jack -- fast, too. And Congress has to go right along with him. It's something Bush wasn't doing."

Jim in Chicago: "Simple, Jack. With more Democrats in Congress and some Republicans, albeit a few, willing to put country ahead of party, we're finally breaking through the obstructionist conservative strategy that stood in the way of real progress since 2006."

Jeff in Illinois: "It certainly isn't because we decided that they are mature adults who can act in a bipartisan manner."

Phil in Pennsylvania: "I believe the approval rating of Congress appears to be rising, but really it's just that their disapproval rating is decreasing. I have never talked to a single person in my life who approved of the actions of the U.S. Congress. So I have to assume this means people are simply less disgusted than usual."

David in Fishkill, New York: "Why, Jack? Because even a blind squirrel finds an acorn once in a while. As far as I'm concerned, they still have a ways to go before I trust them."

And Pam in New York: "It's a mystery to me. If the only prerequisite to a better approval rating is signing a trillion dollar bill that has not been read, discussed or fully debated, then God help us."

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

Thank goodness for the Congress. It gives me a lot of material to work with.

BLITZER: I want you to come to Washington and walk around the halls a little bit. Just get the feeling a little bit.

CAFFERTY: I'd have to get a Kevlar vest.

(LAUGHTER)

BLITZER: Thank you, Jack.

CAFFERTY: Yes.

BLITZER: See you back here tomorrow.

CAFFERTY: Sure.

BLITZER: A rock band's off stage crusade -- is your cell phone helping fund a bloody war in Congo that's killed millions?

Why Good Charlotte wants you to take action.

And from a warm welcome to President Obama to a spiritual ritual on the banks of the River Ganges.

"Hot Shots" coming up.

(COMMERCIAL BREAK)

BLITZER: In Missouri, Republican Congressman Roy Blunt today announced his plans to run for the United States Senate. That likely sets the stage for a showdown between two prominent political families in one of the most politically divided states. Democratic Secretary of State Robin Carnahan jumped into the race two weeks ago. At stake, the seat now held by Republican Senator Kit Bond, who has decided not to run for a fifth term.

Let's go right back to Zain Verjee.

She's working on another story -- a very popular rock band, Zain, is getting involved in a cause that has potentially very significant ramifications. VERJEE: Yes. Exactly, Wolf. A new rock band is singing a new tune, telling fans essentially that may have blood on their hands because their high tech gear is actually linking them to a deadly war in Africa.

(BEGIN VIDEOTAPE)

(MUSIC)

VERJEE (voice-over): Rock band Good Charlotte want to make things right. Joel and Benji Madden say that demand for minerals used in cell phones and electrical goods is fueling war in Congo -- coltan, for example, used in circuit boards, and cobalt, used in cell phones.

BENJI MADDEN, MUSICIAN: These, you know, conflict minerals is what's funding the entire thing. And the effect of this conflict is women being raped, children being hurt, people dying -- you know, the deadliest war, like I said, since World War II.

VERJEE: The armies and militias fighting in Eastern Congo are funded by mineral wealth -- much of it ultimately destined for electronic manufacturers.

J. MADDEN: They're all using this stuff because it's so cheap. You can imagine. They're using slave labor. So they turn a blind eye and just, you know, keep buying it, until we turn the spotlight on it and say, hey, these are the practices that are actually killing people.

VERJEE: Millions have been killed in Congo. The United Nations estimates more than 200,000 women raped. The movie "Blood Diamond" has raised awareness about the international gem trade.

(BEGIN VIDEO CLIP FROM "BLOOD DIAMOND," COURTESY WARNER BROTHERS)

UNIDENTIFIED MALE: You know, in America, it's bling, bling. But out here it's bling bang, huh?

(END VIDEO CLIP)

VERJEE: And speeded up acceptance of diamonds certified conflict-free. But tracing these mineral supply routes is tough. And supplies from legitimate sources can be mixed in with those from conflict zones. So it's hard to know if your electronic device is conflict-free. Activists say call up manufacturers and ask...

JOHN PRENDERGAST, ENOUGH PROJECT CO-CHAIR: Do you know where your -- the minerals that are coming from that you're putting into your computer?

Tell those companies they don't want to purchase their stuff if they're going to continue to fuel conflict in the Congo.

VERJEE: Meanwhile, the Madden twins are working on lyrics for a future song about the crisis in Central Africa.

(on camera): Well, what are the open -- what's the opening line?

B. MADDEN: Take me back. Take me back to Africa.

(MUSIC)

(END VIDEOTAPE)

VERJEE: We contacted manufacturers associations to ask about all this, Wolf. Manufacturing companies have said in the past that they try and make sure that the minerals in their electronics are from legitimate mines in Congo. But the problem is, Wolf, it's just hard to know.

BLITZER: But is it all legal -- Zain?

VERJEE: Yes, it is. There's really nothing illegal about buying or using coltan. Most of the coltan in the world, in fact, is in Congo and there's a huge demand for it -- Wolf.

BLITZER: All right, Zain.

Thanks for bringing us that story.

Zain Verjee reporting.

Before we go, here's 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 Pakistan, a man lifts 250 pounds to beat a friend in a weight lifting game.

In Canada, an excited citizen awaits the arrival of President Barack Obama.

In India, a Hindu priest performs rituals on the banks of the Ganges River.

And in Hungary -- look at this -- a rare antelope sips from a baby bottle over at the zoo.

Some of our "Hot Shots" -- pictures often worth a thousand words.

Remember, THE SITUATION ROOM -- we're on six days a week, Monday through Friday from 4:00 to 7:00 p.m. Eastern and Saturday, 6:00 p.m. Eastern -- from 6:00 to 7:00 p.m. Eastern.

We'll see you back here tomorrow.

I'm Wolf Blitzer reporting.

Up next, "LOU DOBBS TONIGHT."

Kitty Pilgrim is sitting in for Lou -- Kitty.