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THE SITUATION ROOM

Protests Continue in Iran; President Obama Pushes Health Care Reform

Aired June 15, 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: We want to welcome our viewers in the United States and around the world. I'm Wolf Blitzer. You're in THE SITUATION ROOM.

In just a moment, the breaking news out of Iran -- the situation there appears to be, appears to be spiraling out of control. And we want to warn you very early, we have a shocking image. It is not suitable for children. It may even be disturbing to you, so we want to give you plenty of warning about that. We're going to have that image and what's happening in Iran in just a moment. Christiane Amanpour is standing by.

But, first, another major story of interest to you, warnings regarding your health care.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: If we do not fix our health care system, America may go the way of GM, paying more, getting less, and going broke.

So to say it as plainly as I can, health care is the single most important thing we can do for America's long-term fiscal health. That is a fact. That is a fact.

(CHEERING AND APPLAUSE)

(END VIDEO CLIP)

BLITZER: President Obama says the system is -- quote -- "a ticking time bomb for the federal budget."

So, he asked a group of skeptical doctors for what to do to fix it. And he offered his specific proposals.

Our White House correspondent Suzanne Malveaux has more -- Suzanne.

SUZANNE MALVEAUX, CNN WHITE HOUSE CORRESPONDENT: Well, Wolf, the American Medical Association represents about a quarter of the doctors in the country. And it was really expected to be a tough crowd. But they quickly melted. This is the beginning of an essential courtship for President Obama, who desperately needs this group to pass his health care reform.

(BEGIN VIDEOTAPE) OBAMA: We are not a nation that accepts nearly 46 million uninsured men, women, and children.

(CHEERING AND APPLAUSE)

OBAMA: We look out for one another. That's what makes us the United States of America. We need to get this done.

(CHEERING AND APPLAUSE)

MALVEAUX: It was just what the doctors ordered.

OBAMA: We listen to you. We trust you. That's why I will listen to you and work with you to pursue reform that works for you.

MALVEAUX: A little bit of TLC while taking the bitter pill. President Barack Obama gave them both, going after those who overprescribe medications, tests, and procedures with a soft touch.

OBAMA: And a lot of people in this room know what I'm talking about. You didn't enter this profession to be bean counters and paper pushers. You entered this profession to be healers. And that's what our health care system should let you be.

(CHEERING AND APPLAUSE)

MALVEAUX: A standing ovation. The docs took their medicine.

DR. RAJAM RAMAMURTHY, UNIVERSITY OF TEXAS HEALTH SCIENCE CENTER: I was so, you know, pleased that he was so open about issues that are not very pleasing to our ears.

(LAUGHTER)

MALVEAUX: The president even briefly got booed for not setting a limit on how much patients can sue their doctors for malpractice. But the tense moment soon turned into another standing ovation.

OBAMA: This is going to be a priority for me.

MALVEAUX: Just addressing the issue was seemingly enough for some.

UNIDENTIFIED MALE: A patient comes into my hospital with indigestion, it could be a heart attack. If you evaluate the patient and you don't think it's likely, and yet you don't get a cardiology consultation and, god forbid, something bad happens, then somebody is going to be serving a subpoena on you or a lawsuit.

MALVEAUX: But the doctors were most skeptical about the president's government health care insurance plan, an alternative to private programs.

OBAMA: If you like your doctor, you will be able to keep your doctor, period. If you like your health care plan, you'll be able to keep your health care plan, period. MALVEAUX: For many doctors, just a start.

DR. WILLARDA V. EDWARDS, PRESIDENT-ELECT, NATIONAL MEDICAL ASSOCIATION: There are a lot of questions, and details are always questionable.

(END VIDEOTAPE)

MALVEAUX: Among the details that doctors are looking for, how the president will pay for the $1 trillion overhaul. So far, the president has announced intended cuts to Medicare, Medicaid and to hospitals -- Wolf.

BLITZER: Suzanne, thank you.

Before the words even came from the president's mouth, some critics were pouncing. One in particular, the president's former rival, John McCain, had this to say.

(BEGIN VIDEO CLIP)

SEN. JOHN MCCAIN (R), ARIZONA: If we have a government option, then sooner or later, it will dramatically increase the costs. It will crowd out private health insurance. And if you're doing it in the name of competition, we have 1,300 health insurance companies in America today. They're competing.

But they're not getting the kinds of health care costs under control that's necessary. The idea that somehow the government can administer health care in America in a more efficient fashion than the -- than the private sector, I think, flies in the face of the examples of other countries that have done so.

(END VIDEO CLIP)

BLITZER: And, as you heard during Suzanne's piece, malpractice insurance costs you. Doctors fear being sued. So, some are ordering more tests and take costly precautions to avoid being legally vulnerable.

The American Medical Association is a staunch advocate of medical liability reform. It says liability pressure adds between $84 billion to $151 billion each year to health costs that we already pay. And the AMA says liability premiums that doctors pay increased over 1000 percent between 1976 and 2000, except in California.

Let's get back to the breaking news now over Iran's disputed elections. Iran is erupting with protests right now and death. As we warned you only moments ago, we're now seeing some shocking, truly shocking, images. What you're about to see is very disturbing and certainly not suitable for children.

Now would be the time, if you decide to turn away, to do so. The violence has escalated. And, right now, we are going to show you something very disturbing. All right. Here it is. We have obtained this picture from another news organization. It shows a man dead in the street. We cannot confirm how or why this happened. What we do know is that these protests are getting far more violent. There are reports of gunfire, burnings, and inflammatory language for and against President Mahmoud Ahmadinejad and his opponent, Mir Hossein Mousavi.

So, what is the State Department saying?

(BEGIN VIDEO CLIP)

IAN KELLY, STATE DEPARTMENT SPOKESPERSON: What we have seen so far is -- gives us some very deep concerns.

QUESTION: Why?

KELLY: Well, it -- I think that there has been doubt cast on the outcome of the elections. We see a real desire of the Iranian people to -- to express -- to express themselves, to be involved in the political process. And that right needs to be respected.

(END VIDEO CLIP)

BLITZER: All right, let's get the latest from our chief foreign affairs -- foreign correspondent, that is -- our chief international correspondent, I should say, Christiane Amanpour -- Christiane.

(BEGIN VIDEOTAPE)

CHRISTIANE AMANPOUR, CNN CHIEF INTERNATIONAL CORRESPONDENT: Wolf, this day started peacefully. There was virtually no traffic in the streets in the morning, no protests in the morning.

But it did start towards 4:00, when people in the thousands started to come to Revolution Square in downtown Tehran and join a rally. Word had gone around to supporters of Mousavi that this was going to happen today.

Now, the government also took a decision to allow this rally to go forth peacefully, even though the interior ministry had issued a ban on any protests. So, the government had its police and riot police out there, but they were just lining the march route, and not intervening.

Mousavi also was able to join that rally. He came in, in two four-wheel-drive vehicles with security and their own cameras, apparently, and joined that rally, and at one point addressed the crowd. There was no great -- there was no great amplification or sound system, and he spoke through a loud hailer from the top of his car, telling the people that their vote really mattered.

We talked to people at the rally who said, "We want our vote back."

Now, some of the government people are saying: Well, if they have any complaints or any evidence, they should bring that forward. But if they're just dissatisfied with the result, well, sorry, but that's hard luck.

But then Ayatollah Khamenei, the supreme leader, issued a statement urging Mousavi, if he had any complaints, to take it through the legal channels. The Guardian Council, which here vets the election process.

And the Guardian Council said they would take up Mousavi's challenge and investigate it and come back with their results. That was most of the day. And then, at the tail end of the day, there were reports of gunfire and reports of at least one person dead.

We understand that this was apparently at the hands of the un- uniformed hard-line militia that are aligned with the more revolutionary, fundamentalist elements of the regime here and close to, for instance, President Ahmadinejad -- Wolf.

(END VIDEOTAPE)

BLITZER: Christiane Amanpour on the scene for us in Tehran.

And, by the way, we are just getting this in. We are continuing our breaking news coverage. The Iranian presidential candidate Mir Hossein Mousavi is now telling his followers that he will pay any cost -- that's his quote -- pay any cost to contest the -- the country's presidential election, but he has little hope, little hope, that the challenge will succeed.

"I don't have any hope in them," he said in a statement posted on his campaign Web site just a little while ago.

This election is for president, but Iran's president is not the top leader of the country. Mahmoud Ahmadinejad is the second highest ranking government official. He sets economic policy, appoints and supervises the cabinet and sets the agenda for parliament, but the real power rests in Iran's supreme leader, the Ayatollah Khamenei. He controls the military, can even declare war.

He's in charge of the judiciary, leads domestic and foreign policy, and controls Iran's state media.

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

It's a dramatic situation, and it's unfolding very quickly, Jack.

JACK CAFFERTY, CNN ANCHOR: Well, and it smells. And the reason I say that is, 40 million votes were reportedly cast in the election. There are no voting machines. They're all paper ballots. They have to be counted by hand.

And the results of a 40 million-vote election were announced within two hours after the polls closed. That's not even very good subterfuge.

CIA Director Leon Panetta says it's almost as if former Vice President Dick Cheney is wishing for another terror attack on the United States to -- quote -- "in order to make his point." Panetta tells "The New Yorker" magazine Cheney -- quote -- "smells blood in the water on the issue of national security."

He suggests Cheney's actions are like gallows politics. He also calls it dangerous politics. Dick Cheney, who we barely saw or heard from for eight years, has been a very vocal critic of late of President Obama, especially when it comes to the subject of national security.

He has said that the new president, Obama, is making the U.S. less safe by rolling back Bush administration policies. Cheney criticized President Obama for ordering the closing of Guantanamo Bay prison, for stopping the use of so-called enhanced interrogation techniques.

In a speech last month, Cheney called some of President Obama's decisions -- quote -- "unwise in the extreme" -- unquote.

And guess what? Cheney's whining may be working. A CNN/Opinion Research Corporation poll taken last month shows that Dick Cheney's favorable rating is at 37 percent, up from 29 percent when he and President Bush left office in January. Go figure.

In response to Panetta's comments, Cheney said late today -- quote -- "I hope my old friend Leon was misquoted. The important thing is whether the Obama administration will continue the policies that have kept us safe for the last eight years" -- unquote.

Here's the question, then: CIA Director Leon Panetta says it's almost as if Dick Cheney is wishing for another terrorist attack on the U.S. Do you agree? Go to CNN.com/caffertyfile and post a comment on my blog -- Wolf.

BLITZER: Jack, thanks very much.

ANNOUNCER: This is CNN breaking news.

BLITZER: All right, we have been waiting for this. The president of the United States has been meeting with the Italian prime minister, Berlusconi, over in the Oval Office at the White House. And they have been speaking to reporters following their exchange.

Let's go to our White House correspondent, Dan Lothian.

Getting reports right now that the president is directly addressing these elections in Iran.

DAN LOTHIAN, CNN WHITE HOUSE CORRESPONDENT: He is, Wolf. And we're still waiting for the full readout from that meeting.

But, according to the Associated Press, the president said -- quote -- "Up -- it's up to Iran to determine its own leaders," of course, reacting to the elections, the controversial elections, in Iran.

The White House up to this point has been measured in its comments, both leading up to the elections and post-elections, essentially saying that there are doubts about whether or not fraud was committed during the elections and essentially playing up the fact that at least, no matter who won, the folks there, certainly the younger voters, were energized, so not coming down hard, although some critics really wanting the White House to condemn the elections, to perhaps make some public comments supporting the demonstrations.

The White House not doing that, walking a very fine line, but now these comments from the president, first comments since the election, saying -- quote -- again, according to the AP, "It's up to Iran to determine its own leaders" -- Wolf.

BLITZER: Yes, we heard from the vice president yesterday, and we heard from Robert Gibbs, the press secretary. We heard from the State Department, but now for the first time, the president is directly speaking about these elections in Iran.

And, Dan, we're waiting for the videotape. Momentarily, we will be getting it. We will play that exchange, what the president of the United States says about the elections in Iran. That's coming up. Stand by. We will continue the breaking coverage.

Also, after a deadly crash of a regional airliner, federal authorities hold a safety summit. But has the FAA itself routinely ignored safety problems? A former airline captain makes some shocking accusations about a secret relationship. Here's the question. Are you at risk?

Plus, we have the results of a money summit. As stocks tumble on this day, will the recovery take longer than expected? What it means for you.

And measures meant to keep you safe after 9/11 might get watered down -- what it might mean for your safety and your driver's license.

(COMMERCIAL BREAK)

ANNOUNCER: This is CNN breaking news.

BLITZER: President Obama is now speaking out in specific detail on the elections in Iran. We're getting the information. We're about to get the videotape. He's in the Oval Office meeting with the visiting Italian prime minister, Silvio Berlusconi.

Dan Lothian is our White House correspondent.

What else are you picking up about what the president is now saying, Dan?

LOTHIAN: And, Wolf, again, we are attributing this to the Associated Press, as we continue to await the full readout from that meeting and the videotape.

But the latest from the Associated Press saying that the president says he's troubled by the situation in Iran, and it would be wrong to stay silent, so, again, some indication from President Obama that there could be additional language or actions taken against Iran -- Iran -- or additional comments made on the election.

The president, also, in an earlier report, as we mentioned, saying it's up to Iran to determine its own leaders. And, again, Wolf, the administration has been very measured in its comments to the election, pre-election and post-election. Now the president, of course, making these comments. We hope to have further details in just a few minutes.

BLITZER: And he's speaking apparently rather extensively. We are waiting for the videotape. Dan, as soon as that videotape comes in, we will share it with all our viewers in the United States and around the world, specific reaction from President Obama to these elections in Iran -- a lot of people accusing the government in Iran, the regime of President Ahmadinejad, of fraud in these elections.

We will watch the president. That's coming up.

Let's move on, though, right now, as we await the videotape.

The Federal Aviation Administration held a summit here in Washington today on air safety, prompted by February's deadly airline accident near Buffalo, New York, that killed 50 people.

Our senior correspondent, Allan Chernoff, has been reporting on all of this for us.

The FAA has got a lot of concerns about these smaller regional airlines.

ALLAN CHERNOFF, CNN SENIOR CORRESPONDENT: Yes, that's exactly where the focus is, Wolf.

In fact, the new FAA administrator, Randy Babbitt, a former pilot himself, opened the summit by conceding, things are not quite right at regional airlines. He said there are some cracks in the system when it comes to insuring safety.

(BEGIN VIDEOTAPE)

CHERNOFF (voice-over): Tragedy at regional airlines is all too common. The past six fatal airline accidents in the U.S. have been at regional or charter airlines.

RANDY BABBITT, ADMINISTRATOR, FEDERAL AVIATION ADMINISTRATION: Some of the things I have heard and seen recently about the regional airline industry just aren't acceptable in this day and age.

CHERNOFF: Indeed, this former captain at a regional airline, who asked to remain anonymous, told CNN some FAA inspectors regularly ignored safety problems.

UNIDENTIFIED MALE: I would say it probably was some kind of secret relationship, to be quite honest. The FAA knew exactly what was going on, never did anything about it. So, clearly, they had some sort of unspoken bond. Otherwise, you would think that they would be doing more of their job. CHERNOFF: The transportation secretary says such problems belong to past administrations.

RAY LAHOOD, U.S. SECRETARY OF TRANSPORTATION: That will not happen under the administration of Ray LaHood and Randy Babbitt.

BABBITT: No, I -- I concur.

CHERNOFF: Some FAA inspectors, like Christopher Monteleon, who repeatedly complained of alleged safety problems at Colgan Air, claim they faced reprisals.

Last year, more than 30 FAA whistle-blowers had complaints pending against the agency.

(on camera): They say there is a cultural problem within the FAA that opposes reporting of safety issues.

LAHOOD: They will not be shoved under a rug. They will not be put aside. The complaints that you're talking about were under previous administrations. We will pay attention to any kind of complaint or accusation or any kind of concern that is expressed by an employee of the FAA. We're both committed to that. It's a new day at the FAA. And it's a new day at DOT. Our number-one priority will be safety.

CHERNOFF (voice-over): Industry executives met Monday at an FAA safety summit, but some regional carriers were not present, including Gulfstream International, which had trained and employed the pilot who in February crashed the Colgan plane near Buffalo.

(on camera): They say that they were not invited to today's summit.

BABBITT: There were a lot of carriers that weren't invited to the summit.

(END VIDEOTAPE)

CHERNOFF: Babbitt says he would have needed a football stadium to fit all airline industry parties on this issue, but he promises the message is going to get out to everyone in aviation that safety must be priority number one.

And Randy Babbitt as the new administrator of the FAA does have plenty of respect in the industry. He was a pilot at Eastern Airlines for more than two decades and he is also the former president of the U.S. Airline Pilots Association -- Wolf.

BLITZER: And millions of people fly these small regional airlines. And they have to get their act together.

CHERNOFF: The regionals account for half of the flights in this country. We all fly them.

BLITZER: Flew one last night. Thanks very much for that, Allan Chernoff reporting.

The Dow plunged more than 2 percent today, its biggest drop in almost two months. This comes as some of the nation's top financial experts predict the economy may take longer than expected to recover.

Our Christine Romans is in New York with more -- Christine.

(BEGIN VIDEOTAPE)

CHRISTINE ROMANS, CNN CORRESPONDENT: Wolf, we had a rare chance here today to ask what's in store for your house, your job, your gas prices, and your money from the people who should know. When will the economy recover, and what does it look like?

ROMANS (voice-over): U.S. Treasury Secretary Timothy Geithner said the economy will rebound, but it will take time as American families spend less and save more.

TIMOTHY GEITHNER, U.S. TREASURY SECRETARY: As people get themselves back to the point where they're living within their means and have less debt and are less vulnerable in the future, and that's a healthy process for the economy. But it means probably you will see a slower recovery than what we'd normally see.

ROMANS: The consensus is a recovery is in sight, but it will be fragile.

NOURIEL ROUBINI, ROUBINI GLOBAL ECONOMICS: It's going to feel like a recession, even if we are technically out of it. Job losses are going to continue, so people are going to lose jobs. Incomes are not going to grow very fast. Even those who have jobs are going to worry about losing their jobs.

ROMANS: Nouriel Roubini is the economist who predicted this crisis and earned the nickname "Dr. Doom." A commercial real estate bust is coming, he says, and the bank stress tests were not stressful enough. More bank losses lie ahead.

He now predicts 11 percent unemployment by the end of the year and even lower housing prices.

Yale University economist Robert Shiller predicted the housing crash.

ROBERT SHILLER, ECONOMIST, YALE UNIVERSITY: We're not over. Even if we do see an end of the recession, we still have years of fixing to do.

ROMANS: After Japan's real estate bubble burst in 1991, he noted home prices fell each year for 15 years.

The new challenge, rising gas prices despite less demand. Billionaire oil investor Boone Pickens.

T. BOONE PICKENS, BP CAPITAL GROUP: If you don't think the price is going up, you know, you're kidding yourself. And it's going to. ROMANS: The conundrum is oil prices on hopes the economic rebounds. But higher gas prices will hurt consumers and the recovery.

Still, the sense of panic that gripped the country is easing.

MEREDITH WHITNEY, MEREDITH WHITNEY ADVISORY GROUP: People got tired of being sick, tired, and scared. And so it's natural. You know, the government did, what I call, the great government momentum trade, and told everyone they should be confident. So they became confident.

ROMANS (on camera): The treasury secretary outlined plans for tighter regulations to provide stability to the financial system and prevent a collapse again down the road.

But Geithner says, make no mistake about it, there's much more work to be done -- Wolf.

(END VIDEOTAPE)

BLITZER: All right, Christine, thanks very much -- Christine Romans reporting from New York.

The president of the United States is speaking at length right now about the situation in Iran. He's meeting with the Italian prime minister. We are about to get the videotape from the Oval Office. You're going to hear President Obama's reaction to these elections in Iran. That's coming up.

(COMMERCIAL BREAK)

ANNOUNCER: This is CNN breaking news.

BLITZER: All right, we're getting the first public comments from the president of the United States, Barack Obama, on these disputed elections in Iran, major protests and death in Iran.

Right now, let's go to our White House correspondent Dan Lothian.

Slowly, but surely, we're -- we're waiting for the videotape, but we're hearing more and more of what the president is saying during this meeting with the Italian prime minister, Silvio Berlusconi.

LOTHIAN: That's right, Wolf, waiting for the full readout from that meeting, but some of the early quotes coming from that meeting, according to the Associated Press, the president saying that he's troubled by the situation in Iran and that it would be wrong to stay silent, the president also saying that it's up to Iran to determine its own leaders.

Now, here at the White House, I can tell you that senior administration officials are saying that they're very concerned about the election. But, privately, top aides are saying they're waiting to see how the election will impact diplomatic overtures.

(BEGIN VIDEOTAPE) OBAMA: Thank you.

(CHEERING AND APPLAUSE)

OBAMA: Thank you.

LOTHIAN (voice-over): Even as President Obama was selling doctors in Chicago on his health care agenda, the administration was doing its best to strike the right tone in its response to Iran's questionable elections, raising doubts...

IAN KELLY, STATE DEPARTMENT SPOKESPERSON: We are deeply troubled by the reports of violence, arrests, and possible voting irregularities.

LOTHIAN: ... but finding some glimmers of hope.

KELLY: The enthusiasm and robust debate these elections engendered captured the attention of the world. And the essential right of people to express themselves peacefully needs to be respected.

LOTHIAN: Aboard Air Force One, spokesperson Robert Gibbs said, "We continue to be heartened by the enthusiasm of young people in Iran."

The public message here, no Hollywood ending, but the U.S. will continue to engage the Iranian government.

"We will be dealing with the leader we have," said one senior administration official, "not with the one we wish we had had."

Iran's nuclear program, which it claims is for peaceful purposes, has placed it at odds with the U.S. and other allies. But Mr. Obama has been road-testing a kinder, gentler approach in his inaugural speech, in a New Year's message to the Iranian people, and in his address to the Muslim world.

With Iran's controversial election, critics say it's time to wield a big stick, along with the olive branch.

Jim Phillips is with the conservative Heritage Foundation.

JIM PHILLIPS, SENIOR RESEARCH FELLOW FOR MIDDLE EASTERN AFFAIRS, HERITAGE FOUNDATION: The Obama administration has a utopian view of international relations that I think this episode of repression should help to dispel. There is evil in the world. There are regimes that are evil. And it's not just a question of engaging them. The problem is not in Washington. The problem is in Iran.

(END VIDEOTAPE)

LOTHIAN: Now, critics say that Mr. Obama should denounce the election, should call for an outside, independent investigation and should also show public support for the demonstrations. But the White House, again, so far, has been walking this fine line here, saying that they're still assessing the situation in Iran -- Wolf.

BLITZER: And, as I say, we're awaiting the videotape of the president speaking extensively in this Oval Office meeting with the Italian prime minister about the situation in Iran.

We're also hearing he's reacting to the Israeli prime minister, Benjamin Netanyahu's, latest speech on the peace process in the Middle East.

Also, Italy getting ready to accept some of those prisoners from the Guantanamo Bay prison camp.

Lots going on in the Oval Office right now. We're going to get the videotape. You'll see it all unfold right here in THE SITUATION ROOM.

And despite the Iranian government's efforts to restrict Internet access around this disputed election, information about the protest is still spreading out there online.

Let's bring in our Internet reporter, Abbi Tatton.

How's it getting out and what is getting out?

ABBI TATTON, CNN INTERNET REPORTER: Wolf, first of all, consider what the Iranians are up against. They've got some Web sites that are blocked. You can't get on them. You've got an Internet that's very slow right now; cell phone service which is sporadic.

But still, a lot of this information is still getting out there to the world and people worldwide are following it.

We saw earlier today and last night, as well, the protests -- the location, the time being organized on Facebook, on Twitter -- people saying, hey, spread this around, pass this along.

Then you've got people who are right there walking in the protest today, like our iReporter Theruz (ph) -- he didn't want his last name used -- saying that this was an amazing scene, sending these pictures to CNN so we could put it on iReport.com and show everyone.

The other thing you've got is people worldwide trying to help Iranians get this information out there.

One thing we're seeing online right now, Wolf, is people sharing information about how to circumvent blocked sites and keep the material coming.

BLITZER: With all this information that's out there right now, it's hard to determine what is rumor and what is fact.

TATTON: And this is happening on the ground in Tehran -- people are trying to work out -- exactly, facts or fiction. We saw this earlier on today, with a rumor that was spreading around that this protest today might be a trap -- people on Twitter wondering if they should go or not.

That's something that they're really trying to determine, with so much information being passed along in a very fluid situation, just what is happening.

BLITZER: It's very fluid. And we're going to hear from the president of the United States momentarily on the situation in Iran. We'll get that videotape and share it with our viewers.

Other important news we're following right now includes some measures imposed after 9/11 to keep you safe. Some of those measures may be getting watered down in the Congress right now.

Let's go live to our homeland security correspondent, Jeanne Meserve -- Jeanne, what's this all about?

JEANNE MESERVE, CNN HOMELAND SECURITY CORRESPONDENT: Wolf, some say that legislation introduced today is common sense. But others say it is Russian roulette.

(BEGIN VIDEOTAPE)

MESERVE (voice-over): On September 11th, 2001, at least six hijackers used fraudulently obtained driver's licenses to board airplanes. But Real I.D., which tightened requirements for issuing licenses, brought howls of protest from some states, who estimated it could cost $4 billion to implement.

Monday, new legislation, called Pass I.D., was introduced. It would be less expensive and give states more flexibility.

But critics say it gives the nation less security.

UNIDENTIFIED MALE: Basically, we're going back to a system that was abused, which resulted in the biggest domestic tragedy in the history of our country.

MESERVE: The new legislation would remove two problematic parts of Real I.D. -- a requirement that states authenticate documents like birth certificates used to get a license and the creation of a national database to ensure that applicants don't hold multiple licenses in multiple states. Although the federal government pushed back deadlines and provided some funding for Real I.D., 11 states passed legislation prohibiting its implementation and a 12th is expected to follow suit, undermining its effectiveness.

DAVID QUAM, NATIONAL GOVERNOR'S ASSOCIATION: Under Real I.D., if you've got 12 states who just refuse to participate, you have Swiss cheese security.

MESERVE: When she was governor of Arizona, Janet Napolitano signed legislation opting out of Real I.D. Now secretary of Homeland Security, she is embracing the substitute, Pass I.D. JANET NAPOLITANO, HOMELAND SECURITY SECRETARY: It will actually achieve the security goals of Real I.D. It's really a refinement, if you were -- will, of Real I.D., but in a way that the states will actually put into effect.

(END VIDEOTAPE)

MESERVE: Civil liberties groups hate Real I.D. but they don't like the substitute, saying either one would make the driver's license a de facto national I.D. -- Wolf.

BLITZER: Jeanne, thanks very much.

An important story, indeed.

Bloody, deadly election violence in Iran -- the White House watching it all very closely. The president of the United States now, for the first time, speaking out about what has happened in Iran. Huge implications for the Obama administration -- indeed, for the world. We're waiting for the videotape to come in. And once we get that videotape, you'll hear from President Obama on how he feels about what's going on in Iran.

Plus, the anti-Obama rant from a rather unlikely source that left the left-wing sort of shocked, the right-wing slack-jawed. Jeanne Moos takes a "Moost Unusual" look.

(COMMERCIAL BREAK)

ANNOUNCER: This is CNN breaking news.

BLITZER: And the breaking news is that President Obama now, for the first time, speaking openly about what happened in those Iranian elections. Some of his aides have been reacting over the past two or three days, the vice president speaking out extensively yesterday.

But now, for the first time, President Obama is saying how he feels about those disputed elections in Iran.

The videotape is about to be played for us. The White House allowed TV cameras -- TV crews to go into the Oval Office during the president's meeting with the Italian prime minister, Silvio Berlusconi, but didn't allow us to feed that video in live so we could bring it to our viewers.

They are allowing us to now bring that videotape back. And we're going to play that exchange that the president had with the reporters in the Oval Office. He speaks extensively about what's happening in Iran. Stand by for that. That should be coming up momentarily.

In the meantime, let's check in with Alina Cho.

She's monitoring some other important stories incoming into THE SITUATION ROOM right now -- Alina, what's going on?

ALINA CHO, CNN CORRESPONDENT: Hey, Wolf. As a precaution, Air France has replaced air speed monitors on all of its long haul Airbus planes. It follows that jetliner crash in the Atlantic Ocean. The investigation has focused on a possible defect in the sensors.

Meanwhile, in the Atlantic, a U.S. Navy listening device is being used to try to pick up signals from the flight recorders. They are key to the investigation.

In North Korea, tens of thousands of protesters took part in a massive rally in Pyongyang. They are protesting recent U.N. sanctions over North Korea's nuclear program. The sanctions include authorizing searches of North Korean ships on the high seas. North Korea has threatened war with any nation that tries to stop its ships.

The American who calls himself Al Qaeda's spokesman is speaking out about his Jewish heritage in a new Web video. Adam Gadahn says his Jewish grandfather encouraged him to visit family in Israel and was a supporter of Zionist hate groups. Gadahn is one of the FBI's most wanted. A $1 million reward is being offered for his arrest.

And Senator Robert Byrd's office says the lawmaker is still in the hospital, but is expected to be released soon. The 91-year-old West Virginia Democrat -- the longest serving senator -- is undergoing physical therapy. Byrd is recovering from a staph infection -- Wolf, back to you.

BLITZER: All right. We wish -- we wish Senator Byrd a speedy recovery.

All right, the tape is now coming in -- the president of the United States in the Oval Office with Silvio Berlusconi. And the question involves Iran.

(BEGIN VIDEO CLIP)

(QUESTION IN ITALIAN)

OBAMA: OK. I want to say this straight through, then you can translate at the end.

Obviously, all of us have been watching the news from Iran. And I want to start off by being very clear that it is up to Iranians to make decisions about who Iran's leaders will be, that we respect Iranian sovereignty and want to avoid the United States being the issue inside of Iran, which sometimes the United States can be a handy political football or discussions with the United States.

Having said all that, I am deeply troubled by the violence that I've been seeing on television. I think that the -- the democratic process, free speech, the ability of people to peacefully dissent, all those are universal values and need to be respected. And whenever I see violence perpetrated on people who are peacefully dissenting -- and whenever the American people see that -- I think they're rightfully troubled. My understanding is, is that the Iranian government says that they are going to look into irregularities that have taken place. We weren't on the ground. We did not observers there. We did not have international observers on hand. So I can't state definitively one way or another what happened with respect to the election.

But what I can say is that there appears to be a sense on the part of people who were so hopeful and so engaged and so committed to democracy who now feel betrayed. And I think it's important that, moving forward, whatever investigations take place are done in a way that is not resulting in bloodshed and is not resulting in people being stifled in expressing their views.

Now, with respect to the United States and our interactions with Iran, I have always believed that as odious as I consider some of President Ahmadinejad's statements, as deep as the differences that exist between the United States and Iran on a range of core issues, that the use of tough, hard-headed diplomacy -- diplomacy with no illusions about Iran and the nature of the differences between our two countries -- is critical when it comes to pursuing a core set of our national security interests; specifically, making sure that we are not seeing a nuclear arms race in the Middle East triggered by Iran obtaining a nuclear weapon; making sure that Iran's not exporting terrorist activity.

Those are core interests, not just to the United States, but, I think, to a peaceful world in general.

We will continue to pursue a tough, direct dialogue between our two countries and we'll see where it takes us. But even as we do so, I think it would be wrong for me to be silent about what we've seen on the television over the last few days.

And what I would say to those people who put so much hope and energy and optimism into the political process, I would say to them that the world is watching and inspired by their participation, regardless of what the ultimate outcome of the election was. And -- and they should know that the world is -- is watching. And particularly to the youth of Iran, I want them to know that -- that we in the United States do not want to make any decisions for the Iranians, but we do believe that the Iranian people and their voices should be heard and respected.

OK.

(END VIDEO CLIP)

BLITZER: All right. So the president of the United States making a major statement reacting to these disputed elections in Iran. When he says the world is watching, indeed, the whole world is watching him right now, because this program is simulcast on CNN and CNN International. So, presumably, folks in Iran were watching the president of the United States right now with that statement.

Let's talk about what we just heard with "Time Magazine's" managing editor, Rick Stengel; the "Chicago Sun-Times;" Lynn Sweet -- she's also a columnist for Politicsdaily.com; and our own senior White House correspondent, Ed Henry -- Ed, let me start with you.

Obviously, he went in there, into that meeting with Silvio Berlusconi, prepared to speak at length about these elections in Iran.

ED HENRY, CNN CONGRESSIONAL CORRESPONDENT: That's right. Top White House aides knew there were going to be questions at this session and were prepared with this answer beforehand. And what's fascinating is that, just as you said, these words are going to ricochet around the world, especially in Iran.

When you have the president of the United States, who's obviously very popular all around the world, saying things like the world is watching, we've been inspired; he's speaking directly to the people of Iran, who are trying to peacefully protest the elections of that -- the results of that election; and also adding that he's troubled by the violence he's seeing, that he's watching it very closely, that he wants to have some sort of a process -- investigations to go forward.

They are obviously going to hold onto that, the people in Iran, some of them, and see the president of the United States speaking out like that.

But the other key point is the fact that the president said despite everything that's going on there, he's moving full speed ahead on the diplomatic track. There's been some discussion in the last 48 hours, will the president now have to pull back from talking directly with Iran, because maybe the president of Iran did not win a legitimate re-election. He's making clear, he's moving full speed ahead to try to stop them from getting nuclear weapons -- Wolf.

BLITZER: Well, and let me pick that thought up, Rick, because as odious as he says Ahmadinejad's statements over the years have been, he says there is a need for aggressive, very assertive diplomacy with the Iranian regime.

But I suspect that if the situation on the streets of Tehran and other big cities in Iran gets more explosive, that's going to be a major setback to this diplomatic overture to the Iranians.

RICK STENGEL, "TIME" MANAGING EDITOR: Right. I mean he was being both cautious and pragmatic, Wolf, I think. I mean he's cautious because he didn't throw his cards with either side. I mean he didn't say that Moussavi should -- won or that the election was fraudulent. He said we're watching you, we believe that the Iranian people should decide who their leaders are.

So I think he didn't try to -- he didn't try to tip the scale in one direction or another. He's being pragmatic by saying, look, we still want to talk to you guys. But I think you're exactly right, I mean, if the scales begin to go in the other direction and the demonstrations continue and the Ahmadinejad government seems discredited, then I think he has to pull back.

BLITZER: Because, over the years, Lynn, we've all covered stories of historic events, whether Tiananmen Square 20 years ago -- we know what happened there, we know the outcome and we know what's going on 20 years later.

Or 30 years ago, in 1979, when the Shah of Iran was overthrown because of the demonstrations on the streets there.

And then more recently, back in 1991, when we saw demonstrations in the old Soviet Union result in the collapse of the Soviet Union.

We don't know how this story in Iran is now going to play out.

LYNN SWEET, "CHICAGO SUN-TIMES": That's why what's really so interesting is when he talked about that the democratic process and free speech and dissent are universal values, Wolf. I think that was a very important message to the people who are in the streets. It was without taking sides, as Rick pointed out, still an affirmation, in the sense that their voices need to be heard -- especially the message that's interesting when you talk about the world is watching and inspired by them.

And he says to the youth, your voices are heard and respected. You know, that is -- that is basically vintage Obama talking about hope. He did use that twice.

But what is important here is that, in a sense, the Obama doctrine of engagement with Iran has been reaffirmed, even with this maybe disputed outcome of the election, and that Obama continues to say, as he did throughout the campaign, that talking to Iran is better than not talking, especially when nuclear power is on the table.

BLITZER: All right. I want all three of you to stand by, because the other big story we're following -- health care reform.

I want to go out to our Congressional correspondent, Brianna Keilar -- Brianna, you're getting some breaking news on what's going on right now on these health care plans.

BRIANNA KEILAR, CNN CONGRESSIONAL CORRESPONDENT: Wolf, that's right. The nonpartisan Congressional Budget Office has taken a look at the Democratic proposal that has come out of Ted Kennedy's Health Committee to overhaul health care.

And here's what they're telling us -- that it will cost over $1 trillion over the next 10 years and that over that decade, there will be a net gain of just 16 million more Americans getting health insurance than if there wasn't a health care overhaul.

As you can imagine, Republicans are really just slamming this, saying it costs too much and it covers too few.

But Democrats, Wolf, are saying it's an incomplete assessment of an incomplete proposal and they're confident they can cover many more Americans once they have a complete plan.

BLITZER: Because if they can't cover all 46 million uninsured Americans over the next 10 years, that's a setback, because a lot of folks are really assuming -- and this could be a wildly optimistic assumption -- that over the next 10 years, all Americans, if the president got his way, would have health care -- health insurance.

Let's bring back Rick Stengel, Lynn Sweet and Ed Henry -- Ed, first to you.

The president was out in Chicago speaking at the AMA, the American Medical Association, today, laying out his vision for health care reform for all Americans.

This CDO report, based on what Brianna is telling us, that could be an embarrassment for the White House.

HENRY: It could. I mean the day started out pretty well for the president, because even though there had been all this talk about how the AMA as a group, as an organization, is against some of the plans to reform the system, the fact is the president got a very warm reception from the actual doctors at that convention in Chicago.

That's a good start.

But when you look at the report, Brianna is right to focus not just on the cost, but the net gain of how many people will get insurance. Sixteen million more people being insured, while a positive development, far short, as you noted, of the 46 million who are uninsured right now.

And so, clearly, the Republicans will jump on that, even though it's just a draft, it's an early estimate, there's a lot more work to be done on the -- this legislation.

The fact of the matter is, if it's going to cost this much money and potentially taxes are going to have to be raised to pay for it, and it's still going to leave 30 million people, potentially, without health insurance, it's probably going to be an uphill climb for this president.

BLITZER: Rick Stengel, I think you agree with that. This is not necessarily what the White House would look to hear.

STENGEL: Look, it's still -- it's still so far up in the air, in the sense that there's different people who are writing different legislation. Max Baucus will probably have legislation.

And I mean, as we saw with the president today, the -- he still is quite vague about how this will work. And, I mean, one of the things that people are even talking about is a -- is a value-added tax to pay for that, because it is a huge sum.

BLITZER: A huge sum, indeed.

Lynn, is there going few be health care reform this year?

A tough question.

What's your gut?

SWEET: My gut is it's a Demo -- they can do it on Democratic votes alone. And they are going to give up, at some point, on making this a true bipartisan plan -- Wolf.

What -- this will make it harder to get the conservative Democrats on this, the Blue Dogs, on -- on board. That trillion dollar number had been seen coming. The smaller number of people being covered had not. But the devil is in the details.

Obama talked about broad principles today in his speech to the AMA. What people want to know and what is just not known yet, because the legislation has not been completed, is what all these options -- I mean, what the plan means.

What exactly is a public option when it comes to health care?

Lots of ideas out there, nothing firmed up yet.

BLITZER: All right, guys.

Thanks very much.

Two big stories, Iran and health care. We're staying all over these stories.

Let's check in, though, with Jack Cafferty right now for "The Cafferty File" -- Jack.

CAFFERTY: CIA Director Leon Panetta says it's almost as if Dick Cheney is wishing for another terrorist attack on the United States.

Do you agree with that statement?

Andy in Vancouver says: "As sick as it sounds, I think so. Cheney and his peers used 9/11 as a basis for all their sketchy policies for over seven years. Heck, they used the fear card to win the 2004 election. I'm sure Cheney thinks that the best way to revive the GOP is to have the chance to say I told you so. And while this would involve the loss of American life, the war with Iraq should tell you how little he cares for the lives of others."

David in Florida writes: "Even as jaded as I am with Bush- Cheney, I don't think he would wish another terrorist attack on this country. He would like to see Obama's foreign policy fail, just as his administration's did. But I don't really think he would like another 9/11."

John in Pittsburgh writes: "It certainly seems so. It seems like he's putting out there in the whole wide world that 'we are more unsafe and vulnerable than we have ever been, now is your chance to have a go.' He's making us unsafe. He made us hated and now he's making us vulnerable."

Dennis writes: "Absolutely. Cheney is of the mind that he'll be vindicated if we were attacked again. Cheney's number one interest is not America, it's Dick Cheney."

Todd writes: "Panetta's accusations are highly overblown, for all his flaws, Cheney is an American like the rest of us. The last thing he or any of us would look to see is another terror attack on this country."

Karen in Virginia says: "I think Cheney is trying to justify, in his own mind, the things he and Bush did over the last eight years. Wouldn't it make his waning years just a little easier if he could sit back in his armchair and say I told you this would happen?"

And Larry says: "The dude is cold and a vicious politician. I would never bet against Dick Cheney. So whatever he wants, will happen. I'm afraid of Dick Cheney."

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

BLITZER: Jack Cafferty, thank you.

See you back here tomorrow.

It was a most unusual rant against President Obama that surprised a lot of folks out there, not so much because of the criticism, because of who it was coming from.

Here's CNN's Jeanne Moos.

(BEGIN VIDEOTAPE)

JEANNE MOOS, CNN CORRESPONDENT (voice-over): Burgers at Ray's Hell Burger.

OBAMA: Your basic cheddar cheeseburger.

MOOS: Burgers at Five Guys.

OBAMA: A cheeseburger.

MOOS: Date night Washington, date night New York, day and night with Brian Williams, Conan, Leno.

(VIDEO CLIP)

MOOS: But guess who wasn't cheering?

(BEGIN VIDEO CLIP FROM "REAL TIME WITH BILL MAHER," COURTESY HBO)

BILL MAHER, HOST: You don't have to be on television every minute of every day. You're the president, not a rerun of "Law and Order."

MOOS: Left-wing comedian Bill Maher landed one left hook after another.

(BEGIN VIDEO CLIP FROM "REAL TIME WITH BILL MAHER," COURTESY HBO)

MAHER: I get it you love being on TV. I love my bong, but I take it out of my mouth once in a while.

(END VIDEO CLIP) MOOS: Posted an Obama defender: "He needs to put down the bong."

But Bill Maher just toked on another joke.

(BEGIN VIDEO CLIP FROM "REAL TIME WITH BILL MAHER," COURTESY HBO)

MAHER: We look you. We really like you. You're skinny and in a hurry and in love with a nice lady.

(LAUGHTER)

MAHER: But so is Lindsay Lohan.

(END VIDEO CLIP)

MOOS: Maher even said this campaign commercial turned out to be right.

(BEGIN VIDEO CLIP FROM MCCAIN CAMPAIGN AD)

UNIDENTIFIED FEMALE: He's the biggest celebrity in the world.

(END VIDEO CLIP)

(BEGIN VIDEO CLIP FROM "REAL TIME WITH BILL MAHER," COURTESY HBO)

MAHER: And just like Lindsay, we see your name in the paper a lot. But we're kind of wondering when you're going to actually do something.

(END VIDEO CLIP)

MOOS: Liberals winced. Some on the right were doing what one called -- doing what one called the happy dance.

(BEGIN VIDEO CLIP, COURTESY FOX NEWS)

UNIDENTIFIED FEMALE: I mean this is huge to me from -- coming from Bill Maher.

(END VIDEO CLIP)

MOOS: Folks who normally rage at Maher couldn't believe their ears: "I must be in the twilight zone. I agree with this so and so."

(BEGIN VIDEO CLIP FROM "REAL TIME WITH BILL MAHER," COURTESY HBO)

MAHER: And this is not what I voted for.

(END VIDEO CLIP)

MOOS (on camera): But you can't accuse the president of being overexposed on the Bill Maher story. The White House says it doesn't comment on this type of thing.

(BEGIN VIDEO CLIP FROM "REAL TIME WITH BILL MAHER," COURTESY HBO)

MAHER: What he need in his personality is a little George Bush.

(BOOS)

MAHER: He needs to stop worrying abut being loved and bring out that smug, insufferable swagger that says suck on it America.

(END VIDEO CLIP)

MOOS (voice-over): In a corresponding op-ed in the "L.A. Times," Maher said: "The president is on TV more than the ShamWow guy.

(BEGIN VIDEO CLIP, COURTESY SHAMWOW!)

VINCE: Hi. It's Vince with ShamWow! You'll be saying wow every time you use this towel.

(END VIDEO CLIP)

MOOS: Some were saying wow every time Maher opened his mouth.

(BEGIN VIDEO CLIP FROM "REAL TIME WITH BILL MAHER," COURTESY HBO)

MAHER: I'm glad Obama is president, but "The Audacity of Hope" part is over. Right now, I'm hoping for a little more audacity.

(END VIDEO CLIP)

MOOS: Jeanne Moos, CNN...

UNIDENTIFIED FEMALES: ShamWow!

MOOS: ...New York.

(END VIDEOTAPE)

BLITZER: And we want to update you. We've just learned that in taping Jay Letterman's -- excuse me -- David Letterman's show tonight, he formally apologizes to the governor of Alaska and her two daughters for the joke he told the other day -- the joke that's caused all sorts of pain for a lot of folks.

"I told a bad joke," David Letterman says. "I told a joke that was beyond flawed and my intent is completely meaningless compared to the perception. And since it was a joke I told, I feel that I need to do the right thing here and apologize for having told that joke. It's not your fault that I was misunderstood, it's my fault that it was misunderstood. Thank you. So I would look to apologize, especially to the two daughters involved, Bristol and Willow, and also to the governor and her whole family."

That's it -- a formal apology from David Letterman to the Palins.

I'm Wolf Blitzer in THE SITUATION ROOM. Up next, "LOU DOBBS TONIGHT."

Kitty Pilgrim sitting in for Lou -- Kitty?