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Embryonic Stem Cell Limits Lifted; Tobacco State Cracks Down

Aired March 9, 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 buying one car, get one almost for free, it may sound too good to be true. Is it? We're looking into some

amazing deals in these desperate times -- all of that and 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.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: There is no finish line in the work of science. The race is always with us -- the urgent work of giving substance to hope and answering those many bedside prayers, of seeking a day when words like "terminal" and "incurable" are potentially retired from our vocabulary.

(END VIDEO CLIP)

BLITZER: President Obama's offering no promises for cures, but he is opening the door to more federal funding for embryonic stem cell research. It's another big reversal of Bush administration policy and an issue that, for many Americans, amounts to issues of life and death.

Let's go to our White House correspondent, Dan Lothian. He's the story for us.

A lot of debate on both sides of this issue. The president addressed it directly today.

DAN LOTHIAN, CNN WHITE HOUSE CORRESPONDENT: That's right.

And that's why this issue is so controversial. The president has been talking about doing this while out on the campaign trail. And, today, after signing that executive order, the president said that he can't guarantee a cure, but he wants to provide the support, so that researchers can do some groundbreaking work.

(BEGIN VIDEOTAPE)

LOTHIAN (voice-over): It's still not a proven science, but President Obama says embryonic stem cell research is promising.

OBAMA: The full promise of stem cell research remains unknown, and it should not be overstated, but scientists believe these tiny cells may have the potential to understand and possibly cure some of our most devastating diseases and conditions.

LOTHIAN: Like cancer, Parkinson's Disease, and spinal injuries. The president's executive order allows federal tax dollars to fund broader embryonic stem cell research, reversing limits imposed by President Bush. And it directs the National Institutes of Health to develop guidelines within 120 days.

Rhode Island Congressman Jim Langevin, who has been paralyzed for 28 years, is optimistic.

REP. JIM LANGEVIN (D), RHODE ISLAND: I have always believed that some day, I would walk again. It's become more real now that stem- cell research will be supported properly in this country.

LOTHIAN: Mr. Obama is finding support across party lines. In a statement, former first lady Nancy Reagan said, "These new rules will now make it possible for scientists to move forward. . ."

But some say it's a step backwards.

REP. CHRIS SMITH (R), NEW JERSEY: I believe that Barack Obama is turning the clock back and is really going back to what was 10 years ago. It sounded like embryonic stem cells were the future. They're not.

LOTHIAN: Critics are concerned that by destroying human embryos to harvest stem cells, human life is being taken.

Bill and Sherry Keating have two so-called snowflake children, extra embryos from another couple's in vitro fertilization procedure.

SHERRY KEATING, MOTHER OF "SNOWFLAKE" BABIES: Couples need to know they have a life-saving and life-giving choice when it comes to their frozen embryos, and the public especially needs to know that their hard-earned money will require the destruction of the most vulnerable of human life.

(END VIDEOTAPE)

LOTHIAN: The president acknowledged that there is strong opposition over this and that some people are conflicted on this issue. But he pointed out that sound science should not be affected by politics or ideology -- Wolf.

BLITZER: Dan Lothian, thank you.

And our chief medical correspondent, Dr. Sanjay Gupta, he's going to be joining us live this hour. We will talk about what the president's new rule on embryonic stem cell research could mean for all of us.

We're getting information about a major meeting under way here in Washington right now.

Let's go to Zain Verjee. She's working the story for us.

What are we learning, Zain?

ZAIN VERJEE, CNN STATE DEPARTMENT CORRESPONDENT: Wolf, what we have learned just moments ago is that the attorney general, Eric Holder, convened a pretty significant meeting. It was the first Cabinet-level meeting of the Guantanamo Bay Detainee Review Task Force. It was a meeting that took place at the Department of Justice. Hillary Clinton was there.

Bob Gates was there. Dennis Blair, Mike Mullen, Greg Craig was there, among other top-level officials. They were there to discuss and to review the specific cases of Guantanamo Bay detainees. As you know, Wolf, the U.S. wants to close down the Guantanamo Bay facility. It has damaged the U.S.' international reputation. It's hurt the U.S.' ability to deal with other countries.

And it's something that President Obama says that he wants to take action on -- Wolf.

BLITZER: Thank you very much, Zain.

The Pentagon, meanwhile, is shocked by something some Chinese sailors did. There was high-stakes drama between the U.S. and Chinese vessels, where a Chinese ship challenged an American one in international waters.

The confrontation partly ended with Chinese sailors stripping down to their underwear. The story is really remarkable. It has potentially significant military consequences.

Let's go to our Pentagon correspondent, Chris Lawrence, standing by with more -- Chris.

CHRIS LAWRENCE, CNN PENTAGON CORRESPONDENT: Wolf, all of this happened about 75 miles south of Hainan Island and it involved a Navy ship that is used to gather data for undersea warfare.

Now, at one point, the crew thought that the Chinese may try to board their vessel, but the Impeccable is unarmed, so what they did is they fired -- they sprayed some of their fire hoses at the Chinese boats.

That soaked the Chinese sailors, but didn't stop them. They stripped down to their underwear and kept coming.

(BEGIN VIDEOTAPE)

LAWRENCE (voice-over): Sunday, in the South China Sea, the Pentagon says five Chinese boats aggressively blocked the American ship Impeccable, one close to within 25 feet and ordered the Navy ship to leave. When the Impeccable asked for a safe path out of the area, two boats cut it off and forced an emergency stop, and the Navy says the Chinese sailors dropped pieces of wood in the Impeccable's path.

The Pentagon calls it "one of the most aggressive actions we've seen in some time." And the Obama administration has protested the Chinese actions. ROBERT GIBBS, WHITE HOUSE PRESS SECRETARY: We're going to continue to operate in those international waters, and we expect the Chinese to observe international law around them.

LAWRENCE: Analysts say this could be a test to the new administration, and the Chinese will be focusing less on words than what American ships actually do at sea.

JAMES CARAFANO, SENIOR FELLOW, HERITAGE FOUNDATION: If we back off on the right of navigation, if we give in to bullying, then the Chinese will interpret that as a real signal of weakness.

(END VIDEOTAPE)

BLITZER: Chris, I understand this is by no means an isolated incident.

LAWRENCE: No. The Navy says there were several incidents last week, including one in which a Chinese intelligence ship confronted the Impeccable and said to leave the area or -- quote -- "suffer the consequences."

So, the Navy doesn't believe these are accidents, and they think this time, they were literally seconds away from colliding.

BLITZER: Give us some perspective. You have spoken to U.S. analysts. Why do they think the Chinese are doing it like this?

LAWRENCE: Well, this incident happened in international waters, but the Chinese regard most of the South China Sea as its territory. And, right now, they have made it known that even though this was -- this boat was unarmed, it also is involved in gathering data for undersea conflict, and the Chinese have made it known they do not want these survey ships in that area.

BLITZER: All right, Chris, thank you -- Chris at the Pentagon.

The Supreme Court, meanwhile, refused today to hold the gun industry responsible for selling weapons that could end up in illegal markets. The decision ends lawsuits first filed in 2000 by New York City and victims of gun violence.

Lower courts had thrown out the complaint after Congress passed a law in 2005 giving the gun industry broad immunity against such lawsuits.

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

JACK CAFFERTY, CNN ANCHOR: Can we go back to that China story just for a second?

BLITZER: Yes, we can.

CAFFERTY: What was the significance of these guys taking off all their clothes? BLITZER: You know, they were shooting the water cannon as those boats got very, very close. They all got wet, and they took off their clothes to dry off.

CAFFERTY: Their -- OK.

(LAUGHTER)

CAFFERTY: All right.

There's a growing sense -- that makes no sense to me at all, but I will just move forward here.

(CROSSTALK)

BLITZER: They wanted to let their uniforms dry off.

CAFFERTY: So -- well, they're on boats in the ocean, which is full of water. They get wet. That's part of the deal. But -- never mind.

(LAUGHTER)

BLITZER: There's a growing sense that Iran is getting closer and closer to making a nuclear weapon, and somebody may soon have to step in and stop them.

Israel is now saying Tehran has mastered the nuclear technology to make a bomb, with Israel's military intelligence chief saying -- quote -- "Iran has crossed the technological threshold" -- unquote -- adding, the country continues to amass low-enriched uranium. He says the Islamic republic is using expected talks with the U.S. and the West to buy time in order to get enough uranium to build a nuclear weapon.

The spy chief also says, even though Iran has mastered the technology, it still has not made a bomb and is probably a couple of years away from doing so, which would suggest they could be stopped before getting their hands on a nuclear weapon, which would be a really good idea.

Israel just might be the ones to stop them. A recent report by U.S. experts suggests Israel is seriously considering taking unilateral action to stop Iran from getting nuclear weapons. The report says Israel's time frame for action is now getting shorter due to Iranian advances and the possibility they will upgrade their air defenses to give their nuclear program a further reach.

The report argues international sanctions, as well as financial pressure, should be increased.

Meanwhile, Iran has just announced that it successfully tested a new air-to-surface missile. Nonetheless, they continue to deny that they are seeking nuclear weapons.

Here is the question: If Iran is now close to obtaining a nuclear weapon, what should Israel do? Go to CNN.com/caffertyfile and post a comment on my blog -- Wolf.

BLITZER: Jack, thank you.

A shocking prediction about how bad this economy is right now. Wait until you hear who should worry the most.

And who says there's no such thing as a free ride? You can buy a new popular car for just $1.

And how about some other unbelievable deals? You could set yourself up with free food during a free hotel stay as you enjoy free tickets to one of the most popular destinations in the country.

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

(COMMERCIAL BREAK)

BLITZER: The World Bank here in Washington now says the economy is on track to become the worst, the worst since the Great Depression. And it says some people have far more to worry about than others.

Let's turn to CNN's Christine Romans for more -- Christine.

(BEGIN VIDEOTAPE)

CHRISTINE ROMANS, CNN CORRESPONDENT: Wolf, the global financial crisis is deepening. According to the World Bank, the global economy will shrink this year for the first time since World War II. The world's factories and mines are slowing down. Industrial production will tumble 15 percent from last year.

And once growing World Trade will stall for the first time since 1982, amid the sharpest decline in trade in some 80 years. Already, Eastern Europe and Central Asia have been hard hit. The World Bank says the turmoil will be felt far longer and far deeper in developing countries, where growth is stalling and aid and investment are now in jeopardy. Once dynamic developing economies, the bank said, are hit hard.

According to the World Bank, dozens of countries, from Afghanistan to Cambodia, the Philippines, India and Vietnam, are -- quote -- "highly exposed to the crisis." The economic conditions are expected to push 46 million more people into poverty worldwide, according to the World Bank.

The World Bank helps finance the debt of many of these developing nations, and says the crisis is slowing capital flows into these countries. Some countries have been shut out of ailing financial markets. For others, it costs more for them to borrow money -- Wolf.

(END VIDEOTAPE)

BLITZER: Christine Romans, in New York, thank you.

Another unpleasant milestone on Wall Street -- the Dow and the S&P fell to 12-year lows today. The Dow dropped by almost another 80 points, to close at 6547. The S&P lost almost seven points or 1 percent of its value.

Meanwhile, Ford Motor Company workers are taking steps to help the company remain competitive. The United Auto Workers union says its members working for Ford have approved contract changes. They include freezing wages and cutting other benefits. It's the first U.S. automaker to come to an agreement with the union.

Meanwhile, you could call it let's make a deal. If you want to buy a new very popular car for $1, now's your chance.

Let's go to CNN's Mary Snow. She's in New York and she is ready to explain -- Mary.

MARY SNOW, CNN CORRESPONDENT: Well, Wolf, some say it's desperation. Others say it's a sign of business people getting a lot more clever in a very tough climate.

(BEGIN VIDEOTAPE)

SNOW (voice-over): It sounds too good to be true. Buy a big truck at this Seattle dealership, and you get a small car for $1.

UNIDENTIFIED MALE: We're not desperate in selling cars. What we're trying to do is get people knowing who we are and get people out and letting them know there's good deals out there.

SNOW: It certainly is a deal getting attention, but those who follow the industry say read the fine print.

PETER VALDES-DAPENA, CNNMONEY.COM: You're not getting a free car, believe me, because, from what I understand, with an incentive like this, you pay full sticker price for a heavy-duty pickup truck, which, first of all, nobody is paying full sticker price for big trucks right now.

SNOW: Still, the Seattle dealership says it has made about a dozen sales since it promoted the deal last week, and there have been a number of similar offers around the country.

JESSICA CALDWELL, EDMUNDS.COM: I think it absolutely is a sign of desperation at these dealerships. If you would have told someone two, three years ago that you can buy a vehicle and get one free, I think most people would have thought you were crazy.

SNOW: Newspapers are flooded with incentives. "Pick your payment," reads this dealership ad. Mitsubishi touts a recovery program with zero percent APR for 60 months in this ad. But it is Hyundai that has been gaining the most attention. Hyundai first offered to take a car back if you lose a job within a year. In February, it sweetened the deal.

(BEGIN VIDEO CLIP, AD)

NARRATOR: And we expanded our Hyundai assurance so that, if you lose your income, we will make your payments for three months.

(END VIDEO CLIP)

(END VIDEOTAPE)

SNOW: And, for Hyundai, there are signs this program is working. Its car sales haven't been as bad as competitors'. And GM, for one, has said it's looking at Hyundai's program, as well as other incentives, in order to boost sales -- Wolf.

BLITZER: All right, Mary, thank you.

If there are car deals like that out there, there must be other deals. And here's what we found out on the fly. Buy a large pizza, and Pizza Hut will sell you a second medium pizza for a penny.

Walt Disney World has a special offer. Buy a package for four nights, and Disney will give you an additional three nights with theme park tickets. And Continental Airlines and American Airlines are both offering bargain fares for international travel -- lots of bargains out there. Just go and find them.

Members of Congress put in an awkward position -- one Republican wants to halt an automatic pay raise for lawmakers. But some Democrats say he's playing politics.

And a state that's been growing tobacco for 400 years finally puts restrictions on public smoking. But there are some loopholes for lighting up.

And the president says he wants to make health care more efficient. Critics warn that bureaucrats could end up deciding how doctors practice medicine.

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

(COMMERCIAL BREAK)

BLITZER: When many Americans are losing their jobs, here's what some members of Congress are fighting about. Should their pay raises be automatic, or should they have to go on the record and vote to make their paychecks a little bit fatter?

Our congressional correspondent, Brianna Keilar, has more.

(BEGIN VIDEOTAPE)

BRIANNA KEILAR, CNN CONGRESSIONAL CORRESPONDENT (voice-over): From 2008 to 2009, members of Congress saw their pay go up almost $5,000 to $174,000, but Congress didn't even have to approve the pay raise. It went up automatically.

SEN. DAVID VITTER (R), LOUISIANA: Everything's going to hell in a handbasket, and yet members of Congress get an automatic pay raise virtually every year. And people find that really, really offensive.

KEILAR: Louisiana Republican Senator David Vitter says, if lawmakers want bigger paychecks, they should vote for them each year. He wants to tack that change on to an overdue spending bill that would fund the federal government for the rest of the year.

It's got a $410 billion price tag, an 8 percent increase in spending, which Vitter opposes. Democrats like Daniel Inouye say Vitter is playing politics, noting Congress has pledged to scrap its 2010 pay raise and House Speaker Nancy Pelosi has warned the Senate not to change the House-passed spending bill.

SEN. DANIEL INOUYE (D), HAWAII: This amendment is about trying to make it appear as if members are against prohibiting a pay adjustment for themselves, when in fact they already have prohibited a pay adjustment for themselves. This amendment is about trying to change the underlying bill.

(END VIDEOTAPE)

KEILAR: Defenders of this annual pay increase say it's essential to making sure that it's not just wealthy Americans who can afford to be members of Congress, because these lawmakers need to maintain residences in Washington, as well as in their home state, send their kids to college and the like -- Wolf.

BLITZER: All right, Brianna, thank you.

Beachfront property under virtual attack by monster chunks of ice and snow. Stand by for more remarkable video that is just coming in to THE SITUATION ROOM.

And President Obama pays tribute to the late actor Christopher Reeve as an inspiration for the new rules on embryonic stem cell research he ordered today. You are going to hear from the president at length on science, morality and hope.

And has the president paved the way for cures to life-threatening and debilitating diseases? We are going to bring in our chief medical correspondent, Dr. Sanjay Gupta.

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

(COMMERCIAL BREAK)

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

Happening now, we're learning more about the man charged with gunning down a pastor during his sermon in Maryville, Illinois. The prosecutor says the alleged gunman marked yesterday as death day in a planner that was found in his home. Investigators have charged the suspect with first-degree murder.

Mountains of ice and snow are taking over a neighborhood in Linwood, Michigan. Among Lake Huron, the huge ice chunks are pushing up against homes. Residents from 36 homes have been forced to evacuate.

And Virginia will ban most smoking in bars and restaurants. The governor signed a bill into law today. The ban takes effect December 1 -- all of this, plus the best political team on television. I'm Wolf Blitzer. You're in THE SITUATION ROOM.

One of President George W. Bush's most controversial actions reversed. Let's get some more on our top story on this day. President Obama allows federal tax dollars to go forward with embryonic stem cell research. The president says he's taking the politics out of something that offers great potential.

(BEGIN VIDEO CLIP)

OBAMA: Now, in recent years, when it comes to stem cell research, rather than furthering discovery, our government has forced what I believe is a false choice between sound science and moral values.

In this case, I believe the two are not inconsistent. As a person of faith, I believe we are called to care for each other and work to ease human suffering. I believe we have been given the capacity and will to pursue this research, and the humanity and conscience to do so responsibly.

It's a difficult and delicate balance. And many thoughtful and decent people are conflicted about, or strongly oppose, this research. And I understand their concerns, and I believe that we must respect their point of view.

But after much discussion, debate and reflection, the proper course has become clear. The majority of Americans -- from across the political spectrum, and of all backgrounds and beliefs -- have come to a consensus that we should pursue this research, that the potential it offers is great, and with proper guidelines and strict oversight, the perils can be avoided.

That is a conclusion with which I agree. And that is why I am signing this executive order, and why I hope Congress will act, on a bipartisan basis, to provide further support for this research.

(END VIDEO CLIP)

BLITZER: While the president talked about the promise of this research, he keeps on saying that cloning humans is profoundly wrong.

(BEGIN VIDEO CLIP)

OBAMA: Ultimately, I cannot guarantee that we will find the treatments and cures we seek. No president can promise that.

But I can promise that we will seek them, actively, responsibly, and with the urgency required to make up for lost ground, not just by opening up this new front of research today, but by supporting promising research of all kinds, including groundbreaking work to convert ordinary human cells into ones that resemble embryonic stem cells.

I can also promise that we will never undertake this research lightly. We will support it only when it is both scientifically worthy and responsibly conducted. We will develop strict guidelines, which we will rigorously enforce, because we cannot ever tolerate misuse or abuse. And we will ensure that our government never opens the door to the use of cloning for human reproduction. It is dangerous, profoundly wrong, and has no place in our society, or any society.

(END VIDEO CLIP)

BLITZER: The president also honored those who have worked to bring the seemingly impossible to the finish line.

(BEGIN VIDEO CLIP)

OBAMA: ... those whose names we don't know, who organized and raised awareness and kept on fighting -- even when it was too late for them or for the people they love. And we honor those we know, who used their influence to help others and bring attention to this cause -- people like Christopher and Dana Reeve, who we wish could be here to see this moment.

You know, one of Christopher's friends recalled that he hung a sign on the wall of the exercise room where he did his grueling regimen of physical therapy. And it read: "For everyone who thought I couldn't do it, for everyone who thought I shouldn't do it, for everyone who said, 'It's impossible,' see you at the finish line."

Christopher once told a reporter who was interviewing him: "If you came back here in 10 years, I expect that I'd walk to the door to greet you."

Now, Christopher did not get that chance. But if we pursue this research, maybe one day -- maybe not in our lifetime or even in our children's lifetime -- but maybe one day, others like Christopher Reeves might.

There is no finish line in the work of science. The race is always with us -- the urgent work of giving substance to hope and answering those many bedside prayers, of seeking a day when words like "terminal" and "incurable" are potentially retired from our vocabulary.

BLITZER: The president also hoping that the stem cell decision will open the way to medical miracles.

Let's find out what this might mean.

Our chief medical correspondent, Dr. Sanjay Gupta, is joining us -- Sanjay, when it comes to embryonic stem cell research, stem cell research in general, the decision made by the president today, what does it mean?

DR. SANJAY GUPTA, CNN CHIEF MEDICAL CORRESPONDENT: Well, you know, besides 21 stem cell lines over the last several years, there's been no federal funding for embryonic stem cell research. So it's been somewhat of a stagnant field, at least in the United States, for some time. It's a little bit hard to know, as a doctor, as a scientist, how much of an impact this is going to have right away.

You know, could it be sort of a linear increase in the amount of research that's going on or could it be exponential as science starts to build on itself?

There's a lot of enthusiasm, certainly, for this. There is an FDA-approved trial in January of this year for spinal cord injured patients. They're going to start recruiting those patients in the summer of this year. It will be a few years, probably, before we start to see any results.

So it's going to take some time, but certainly faster than I think otherwise would have happened -- Wolf.

BLITZER: Looking down the road, Sanjay, what are the safety issues?

GUPTA: You know, that's a good question. And, you know, there's really two challenges when it comes to using stem cells. One is that, you know, you have these blank cells. People probably have heard that term by now. The beauty of these cells is they can be programmed into just about anything.

So let's say someone has Parkinson's Disease and has a lack of dopamine in a certain area of the brain, you could program these cells to somehow take care of that problem.

But in addition to programming the cells, you've got to make sure you can control the cells, as well. For example, they've got to produce dopamine, but not too much dopamine. They've got to fix a spinal cord injury, but they can't make too many neurons, because if you start to create wayward stem cells, you could develop things like tumors.

So those are going to be the challenges. Those are going to be the safety issues -- Wolf.

BLITZER: So for people, Sanjay, who are hoping for a cure -- whether for Parkinson's or Alzheimer's or spinal cord injuries -- should they get their hopes up right now?

GUPTA: Well, you know, I think this certainly holds a lot of promise. I think a lot of scientists and a lot of people have been studying this for some time. And a lot of people who had been focused on this think there is a lot of promise here.

To be clear, no human beings that we know of have been benefited in some way from stem cells as of yet. One way to think about it is if you have these discrete problems in the body -- for example, if you've had a heart attack and heart cells have died, could you somehow replace those heart cells to improve your heart function.

Again, with the example of diabetes, if your pancreas isn't making enough insulin, could you somehow replace those insulin- producing cells?

A lot of scientists say yes.

Wolf, it's going to take time. You know, people -- it's not going to change tomorrow, probably not for years from now. But this could be the beginning of it.

BLITZER: It's a whole new world out there.

Sanjay, thank you very much.

Dr. Sanjay Gupta.

GUPTA: Thanks, Wolf.

BLITZER: President Obama criticizes his attorney general. He suggests what Eric Holder should have said about race in America. The best political team on television is standing by to weigh in.

And one size fits all -- that's the kind of medicine some critics say could result from the Obama administration's efforts to cut waste in health care.

We'll explain right here in THE SITUATION ROOM.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

ERIC HOLDER, U.S. ATTORNEY GENERAL: Though this nation has proudly thought of itself as an ethnic melting pot, in things racial, we have always been and we, I believe, continue to be, in too many ways, essentially a nation of cowards.

(END VIDEO CLIP)

BLITZER: That was the attorney general of the United States, Eric Holder, talking about race as an issue just a couple weeks or so ago.

When asked about it on Friday in an interview, President Obama told "The New York Times" this.

(BEGIN VIDEO CLIP)

OBAMA: I think it's fair to say that if I had been advising my attorney general, we would have used different language. I think the point that he was making is that we're oftentimes uncomfortable in talking about race until there's some sort of racial flare-up or conflict.

(END VIDEO CLIP)

BLITZER: All right. So are we a nation of cowards when it comes to race? Let's talk about that and more with our senior political analyst, Gloria Borger; our CNN contributor, Steve Hayes of "The Weekly Standard;" and our CNN political analyst, Roland Martin. They're all part of the best political team on television.

Roland, let me start with you, because I believe at the time you agreed with the attorney general that we are basically, when it comes to race, a nation of cowards.

ROLAND S. MARTIN, CNN POLITICAL ANALYST: Look, first of all, he said when it comes to the conversation. And he also talked about self- segregating -- how we, frankly, go our own separate ways and in forced situations like the workplace, we're together. But when it comes to schools, when it comes to neighborhoods, when it comes to churches, even what happens in our own homes, we self-segregate.

So he's absolutely right. We are deathly afraid to confront our innermost feelings. And he was not talking just to whites. He was saying to African-Americans, Hispanics, Asians, as well.

BLITZER: And, Gloria, the president, though, he seemed to be saying, you know -- and I guess he did say he would not have used such words if Eric Holder had asked him to review his speech beforehand.

GLORIA BORGER, CNN SENIOR POLITICAL ANALYST: Right. Yes. I think what the president was saying is that he thought that Eric Holder may have been unnecessarily provocative. And when you look at the campaign that Barack Obama ran to become president of the United States and you look at the speech that he gave on race, which was a pivotal moment in his campaign, he didn't use this kind of language because it's not who he is. And he clearly made the point, if I had talked to Eric Holder, I would have -- I would have nixed that language.

BLITZER: Yes, Steve. He did go on to say in "The New York Times" interview: "I'm not somebody who believes that constantly talking about race somehow solves racial tensions."

He made that pretty clear, I think, throughout his -- throughout the campaign and since.

STEPHEN HAYES, SENIOR WRITER "THE WEEKLY STANDARD": He has, although, to be sure, he addressed that at some length in his book. I think really with Barack Obama, we have two different people on race. On the one hand, we have the rhetorician, who speaks sometimes very eloquently and passionately and says things -- describes an America, I think, that we all want to live in.

On the other hand, we have the policy maker, who has been, at times, an aggressive defender of racial preferences and segregating by race -- the very things he says in his speeches he doesn't want to do.

So I think we get a little muddled message from the president on this.

MARTIN: And Wolf...

BLITZER: Two different Obamas, Roland?

MARTIN: Look, we've got two different people here. Eric Holder is his own man, the attorney general. President Barack Obama is his own man. So, frankly, to use a basketball analogy, maybe Obama, he likes to simply come down the lane, you know, finger roll it, whereas Holder came down and slammed down a ferocious dunk.

I mean so it's two different people. And so he might say I might have advised different language, but I don't think -- he did not rebuke Holder. He did not say he was wrong. He simply I would have advised him to use different language.

BORGER: You know, that's about a...

MARTIN: That's different from rebuking his attorney general.

BORGER: But, Roland, that's about as close to a public rebuke as you're going to get from a president of the United States. You know, he's not going to say I took Eric Holder to the woodshed. But I bet if those -- those folks were talking privately, that the president would have said to the attorney general, you know, I wish you hadn't seen that.

BLITZER: Here's another...

MARTIN: Well, actually...

BLITZER: ...speaking about rhetoric...

MARTIN: ...from what I've heard from the White House, they haven't really slammed him -- Eric Holder. And he stands by exactly what he said.

BLITZER: Here's another quote from Robert Samuelson of "Newsweek" magazine, the columnist, speaking about what he calls presidential doubletalk: "Barack Obama is a great pretender. He constantly says he's doing things that he isn't and he relies on his powerful rhetoric to obscure the difference. Confidence, too little; and uncertainty, too much; are at the core of this crisis. All of Obama's doubletalk threatens to reduce the first and raise the second."

I guess Samuelson, Steve, is making a point that you were suggesting earlier, that -- just to put it bluntly, he's speaking out of both sides of his mouth.

Is that the point you were making, Steve?

HAYES: Yes, I think it is. And, look, he's very good at this. He did this -- I remember when I was following him in Iowa back in December of 2007 he took a question from the audience about gun control and answered the question in such a way that the person who asked it, who was clearly a strong supporter of the Second Amendment, thought wow, he's really speaking to my concerns -- and then I think sort of gradually walked it back to a place that puts him, I would say, on sort of the liberal side of the Democratic continuum there. But he's very good at this. He does it very effectively. The problem, I think, that Samuelson raises is when his rhetoric runs into sort of harsh realities that don't really measure up.

BLITZER: What do you think, Roland?

MARTIN: Well, first of all, I would have appreciated some examples from Samuelson. It sounds like he was talking sort of generically, as well.

Look, the bottom line is when you are president of the United States, you are going to be in a situation in terms of where -- in terms of what you're saying is different from governing. So we can sit here and try to say well, as a president, you have to look at things in black, white, stark realities. But he has to work in the reality of compromise.

And that's been a problem, frankly, from the last eight years. The president recognizes that. And so, sure, he's going to get called out on it. Trust me, every time he says something, if he doesn't follow it up with actions, look for it in 2010 or 2012...

BLITZER: I think, Gloria...

MARTIN: ...(INAUDIBLE) has to recognize that.

BLITZER: I think it underscores not only what we're talking about, but these comments that the honeymoon for this new president is basically over.

BORGER: Well, I think it -- I think it is over. Look, I think what Bob Samuelson was referring to was the president's budget. There's -- he believes -- and -- that there was not a lot of honesty in the budget, that the president didn't attack entitlements enough, that the president may be reducing defense spending too much.

But, you know, it's interesting, because you're kind of damned if you do, damned if you don't. You know, some people are saying that President Obama is trying to do too much and attack too much at once. One of those things would be entitlement reform. Other people are saying he's not doing enough.

So it's kind of hard at this time in crisis to know how much is enough.

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

Thanks very much to all three of you.

See you back here tomorrow.

They're caring for your health, but are doctors, hospitals and clinics costing the economy simply too much money?

The White House wants to cut the waste in health care -- why critics worry about that. Plus, they say you are what you eat.

How about bacon ice cream or deep fried Tootsie rolls?

Jeanne Moos has some food for thought - "Moost Unusual" food for thought.

(COMMERCIAL BREAK)

LOU DOBBS, CNN ANCHOR: Coming up at the top of the hour, we'll be reporting on new evidence the stock market has no confidence in President Obama's economic policies. Investors ignoring the president's assertions that he's not a socialist. We'll have complete coverage.

Also, the government's huge stimulus package could give jobs to hundreds of thousands of illegal aliens. Lawmakers say that's just fine -- at least some of them. We'll have that report.

And a rising number of Americans say they have no religion. We'll examine tonight what that means to our society, our nation, with two of the country's leading thinkers on religion and politics.

And the Obama administration says earmarks -- what you and I would call pork -- in this year's spending bill are last year's business. But they're from this year's leaders. I'll be talking with an opponent of earmarks, certainly, Senator Tom Coburn.

Join us for all of that, all the day's news and much more at the top of the hour.

THE SITUATION ROOM returns right after this.

(COMMERCIAL BREAK)

BLITZER: It sounds simple enough -- if you want to reform health care, cutting waste and inefficiency seems like a very good place to start.

But what if that second test or additional treatment was yours?

Is that waste or is it necessity?

Our national political correspondent, Jessica Yellin, is here with more on this story.

The president trying right now to do something about this.

JESSICA YELLIN, CNN NATIONAL POLITICAL CORRESPONDENT: He's trying hard. And it's stirring up something of a controversy, Wolf.

President Obama regularly points out that the U.S. spends more than any other nation on health care. His team believes the nation can get better medical care for less.

So we took a closer look at one of the ways they believe this can happen.

(BEGIN VIDEOTAPE)

YELLIN (voice-over): If you're admitted to the hospital with heart disease, one doctor might give you 10 treatments, but another doctor in the same hospital could give you twice as many treatments at twice the cost -- without knowing there's a better way.

Experts say inefficient doctors are costing the nation $150 billion a year.

PETER ORSZAG, DIRECTOR OF OFFICE OF MANAGEMENT AND BUDGET: And all that you seem to be getting in exchange for the extra costs are more tests, more days in hospital and other things that don't actually improve your health.

YELLIN: Consultant Mitch Seltzer is one of a handful of researchers studying the best, most efficient medical practices. He's advising the Obama administration and he says doctors who are more efficient also have patients with the best results.

MITCH SELTZER, EFFICIENCY CONSULTANT: If we buy care from physicians who are clinically effective and cost-effect, we will get better -- we will get better health care. The outcomes for those patients are better.

YELLIN: The White House sees this as key to health care reform. Already, it got more than $1 billion in stimulus money to fund research on the best practices, which could lead to a national database.

But critics are howling. Richard Scott, who runs for-profit urgent care clinics, is mounting a media campaign against the Obama health care plan.

RICK SCOTT, CHAIRMAN, CONSERVATIVES FOR PATIENTS' RIGHTS: Are the decisions that I make with my doctor for my care going to be dictated by some federal bureaucracy? That's very scary.

YELLIN: Conservatives worry the government will eventually limit doctors' options by reimbursing only those treatments deemed cost- effective.

(END VIDEOTAPE)

YELLIN: Now, the Obama administration insists that won't happen. Seltzer, the consultant I interviewed in the piece, Wolf, says doctors will voluntarily adopt the more efficient practices once they see how effective they are.

Now, the nation's hospitals and doctors' organizations say they support the move to gather this data, but they aware wary of any government efforts, Wolf, that would dictate how doctors should do their job.

BLITZER: Sometimes you speak to a bunch of doctors and you get a whole bunch of different opinions. And it makes it sound almost like an art, rather than a science sometimes.

YELLIN: Exactly.

BLITZER: It's an art.

Thanks very much, Jessica.

Let's check back with Jack Cafferty.

He's got "The Cafferty File" -- Jack.

CAFFERTY: You know, my best friend -- and he's no longer with us -- was my physician. He passed away a couple of years ago. But he and I had long conversations about health care costs.

One of the reasons doctors -- some doctors order all these extra tests is because they're afraid of malpractice lawsuits. And they order every test under the sun just to cover their behind in the event that, you know, a patient decides they want to sue because the treatment didn't go exactly the way they wanted it to.

So some of this health care reform is going to have to be -- you know, we're going to have to look at the legal ramifications of the high malpractice premiums and the doing the testing of patients as a way to protect the physicians whatchamacallit.

The question this hour is if Iran is now close to obtaining a nuclear weapon, what should Israel do about it?

John in California: "Israel should do nothing. Action coming from them would certainly trigger a global call to war from the rest of Islam and we'd have an enormous mess on our hands. The clever move here is to have Saudi Arabia, who has a good air force, be the entity commissioned to take out that nuclear plant in Iran on our behalf. The rest of the Muslim world would accept that."

Mike in New York writes

"They ought to come clean, Israel, about their own nuclear program, thank the French and British for helping them set it up in the first place. That would be a good first step toward instituting a regional nuclear inspection regime that would be in everyone's best interests."

Bob in New Jersey writes: "The only country with the potential to stop Iran's pursuit of a nuclear weapon diplomatically is Russia. Russia may be more inclined to follow that course now in exchange for the U.S. halting its plans to deploy an ABM system in Eastern Europe. Israel should wait to see how the current diplomatic developments turn out."

Chad in Los Angeles writes: "Just take them out. We have too many conflicts going on, so Israel owes us this one. Any help to control the world's over population. Thanks."

Deb in Illinois: "The question is not what should Israel do, but what will Israel do? Obama had better saddle up and do some big time wheeling and dealing with other involved nations and get a plan in place and working before Israel feels forced to act."

And Jake in New Jersey says: "Whatever they do, they need to do it by themselves and not expect us to do it for them or drag us into it with them."

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, if you're so inclined -- Mr. Wolf.

BLITZER: A lot of people are, Jack.

Thanks very much.

Jeanne Moos' "Moost Unusual" piece on eating habits coming up next.

(COMMERCIAL BREAK)

BLITZER: It's no secret a lot of Americans have a weight problem. And now one Web site has a "Moost Unusual" look at some fattening foods in rather bizarre combinations.

CNN's Jeanne Moos has some food for thought which may leave bad taste in your brain.

(BEGIN VIDEOTAPE)

JEANNE MOOS, CNN CORRESPONDENT (voice-over): If you're eating, stop. Instead, feast your eyes -- a Sloppy Joe on a glazed Krispy Kreme, gravy pizza.

UNIDENTIFIED FEMALE: My personal favorite, I think, is the hot dog encased in French fries. My fantasy is about that one.

UNIDENTIFIED MALE: This one is brilliant. It's a pizza and the crust is made out of hamburger meat.

Is that not genius?

(END VIDEO CLIP)

MOOS: These are the two geniuses who dreamed up the new Web site ThisisWhyYoureFat.

(BEGIN VIDEO CLIP, COURTESY THISISWHYYOUREFAT.COM)

UNIDENTIFIED FEMALE: And where dreams become heart attacks.

(END VIDEO CLIP)

MOOS: Chocolate-covered bacon, anyone?

Or maybe you'd prefer a pink sandwich.

(BEGIN VIDEO CLIP, COURTESY THISISWHYYOUREFAT.COM)

UNIDENTIFIED FEMALE: It's four packages of cream cheese, strawberry cream cheese, around a loaf of bread.

(END VIDEO CLIP)

MOOS: Manhattan couple Jessica Amason and Richard Blakeley are looking for your deliciously gross submissions.

(BEGIN VIDEO CLIP, COURTESY THISISWHYYOUREFAT.COM)

UNIDENTIFIED FEMALE: If it doesn't make us go ugh in the first five seconds, throw some cheese on it.

UNIDENTIFIED MALE: The epitome of this Web site, I think, could be summed up in the pizza burger.

(END VIDEO CLIP)

MOOS: It's a bacon cheeseburger slapped between two pizzas. Connoisseurs even put it...

(VIDEO CLIP)

MOOS: ...to music.

(VIDEO CLIP)

MOOS: Fried stuff on a stick is popular, from deep-fried Tootsie rolls to deep-fried White Castle cheeseburgers. And bacon is big.

(BEGIN VIDEO CLIP, COURTESY THISISWHYYOUREFAT.COM)

UNIDENTIFIED FEMALE: Bacon, meat loaf, mac and cheese.

(END VIDEO CLIP)

MOOS: Bacon donuts, bacon ice cream, bacon chocolate chip cookies, a bacon-flavored spread called Baconnaise that Jon Stewart recently used as a dip for pancake and sausage on a stick.

(BEGIN VIDEO CLIP, COURTESY COMEDY CENTRAL)

JON STEWART, HOST "THE DAILY SHOW WITH JON STEWART": That's what I like to do. I like to...

(END VIDEO CLIP)

MOOS: When "Saturday Night Live" did a bit making fun of ever more layered tacos wrapped in pizza...

(BEGIN VIDEO CLIP FROM "SATURDAY NIGHT LIVE," COURTESY SNL/BROADWAY VIDEO)

UNIDENTIFIED MALE: Well, it's not a Taco Town Taco until we roll it up in a blueberry pancake, dip it in batter and deep fry it until it's golden brown.

(END VIDEO CLIP)

MOOS: Someone took "SNL's" recipe and actually made it.

And then there was the delicacy copied from Weird Al Yankovic.

(BEGIN VIDEO CLIP FROM "UHF," COURTESY CINECORP SAC)

UNIDENTIFIED MALE: A Twinkie weiner sandwich, your favorite.

(END VIDEO CLIP)

MOOS: Even we are capable...

(on camera): So we'll put this...

(voice-over): ...of using a Twinkie as a bun for a weiner and drizzling it with Cheese Whiz.

UNIDENTIFIED FEMALE: Um.

MOOS (on camera): Cheers.

UNIDENTIFIED FEMALE: All right, cheers.

UNIDENTIFIED MALE: I can't eat this.

MOOS (voice-over): He's a vegetarian. The Twinkie weiner sandwich wasn't so bad.

Is this story making you hungry?

UNIDENTIFIED FEMALE: Yes.

UNIDENTIFIED MALE: That's a fair favorite.

UNIDENTIFIED FEMALE: There it is.

UNIDENTIFIED MALE: This is it.

MOOS (on camera): I hear your stomach growling. I heard that.

(LAUGHTER)

MOOS: One man's groan is another man's growl.

Jeanne Moos, CNN, New York.

(END VIDEOTAPE)

BLITZER: Maybe you'll have a little bit lighter dinner tonight.

Thanks very much for joining me.

I'm Wolf Blitzer right here in THE SITUATION ROOM. We'll see you back here tomorrow.

Until then, thanks very much for watching.

Let's go to "LOU DOBBS TONIGHT".

Lou is in New York -- Lou.