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Health Care Delay; Alarm Sounded Over Electronic Cigarettes

Aired July 23, 2009 - 18:00   ET

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


(BEGIN VIDEO CLIP)

SEN. HARRY REID (D-NV), MAJORITY LEADER: I think that it's better to have a product that is one that's based on quality and thoughtfulness, rather than trying to jam something through.

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: I have no problem if I think people are really working through these difficult issues, in making sure that we get it right. But I don't want to delay just because of politics.

And I have to tell you, sometimes, delays in Washington occur because people just don't want to do anything that they think might be controversial.

(END VIDEO CLIP)

BLITZER: Let's bring in our senior White House correspondent, Ed Henry and our senior congressional correspondent, Dana Bash.

Dana, why did Harry Reid, the majority leader, feel he had to say this today?

DANA BASH, CNN SENIOR CONGRESSIONAL CORRESPONDENT: You know, Wolf, he basically felt he had no choice but to acknowledge the reality that is going on behind those doors, bipartisan senators meeting right now just like they have been for days saying that they think they can finally get a deal that can actually pass the Senate, a health care reform bill that can pass the Senate, and they say they're not going to be rushed.

Now, there are some -- there's some frustration among Democratic leaders, according to Democratic sources I'm talking to, that they won't move faster. But they have proven that they are basically impervious to political pressure, so the Democratic leadership in the Senate had no choice but to say we're going to wait until the fall.

BLITZER: Ed, we just heard the president say it's OK with him, this delay, but how significant of a setback is this?

ED HENRY, CNN SENIOR WHITE HOUSE CORRESPONDENT: It's definitely a blow to this president.

He is the one who set that August deadline, saying, look, this is the best weapon against inertia in Washington. But the bottom line is he is correct in saying it's not like Congress has just gone home and given up. There is still hope for his effort, because, as Dana says, they're behind her right there working behind closed doors. They haven't given this up, and the president is still standing firm in saying he wants this all wrapped up in the fall. He still has hope for that.

And he ended this town hall meeting today by saying keep the heat on Congress.

What's interesting, of course, the heat on Congress, that's the Democratic leaders, not just the Republicans -- Wolf.

BLITZER: And, Dana, you're in the Senate where things are clearly slowing down. What about the House?

BASH: You know, there is still a deep divide within the president's own party, own Democratic Party, in the House as well. Those conservative so-called Blue Dog Democrats still insisting that their party's plan doesn't do enough to control medical costs, among other things.

So there is a delay there. We learned, Wolf, of a pretty contentious meeting among House Democrats today trying to figure out if they should follow the Senate's lead and delay their vote until the fall, but right now House leaders say that they are determined not to do that. They're determined to press on.

And the reason they pretty much admit is going home for an entire month would be politically devastating. So they're even talking about staying, you know, delaying their August recess or even canceling it altogether if they have to.

BLITZER: Ed, I watched the president's town hall meeting in Cleveland. You're in Shaker Heights, one of the suburbs of Cleveland, right now. In his opening statement, I got a sense that he was recalibrating his message a bit. I don't know if you did.

HENRY: Absolutely.

You heard it last night in the news conference back in the East Room. Again today, he kept talking about insurance reform, instead of health reform. That's because the White House has heard the message loud and clear that too much of the focus was on the 46 million, 47 million people without insurance.

The millions of people who have coverage are saying, wait a second, what's in it for me? Are you saying you're just going to raise my taxes to help cover more people? So, the president recalibrating today, talking about insurance reform to say, look, this is also about stabilizing the people who have insurance right now, making sure that insurance companies don't give you these exorbitant out-of-pocket stuff, cap that kind of thing to make sure that people who do have insurance get to keep it and they don't fall into the same boat of the people who are uninsured -- Wolf.

BLITZER: Ed Henry, he's with the president in Shaker Heights. Dana Bash is up on Capitol Hill. Guys, thank you. We have certainly been hearing a lot of rhetoric over the last few days about the timing of health care reform, but this comment from the House speaker, Nancy Pelosi, certainly caught our ear.

(BEGIN VIDEO CLIP)

REP. NANCY PELOSI (D-CA), SPEAKER OF THE HOUSE: I'm not afraid of August. It's a month. What I am interested in is the sooner the better.

(END VIDEO CLIP)

BLITZER: And just ahead, we will take a political time-out from the catchphrases and all the buzzwords, take a closer look at why health care reform could be a lot like going to a restaurant. You might be interested in that.

Let's turn to a story right now that's getting a lot of people righted up, including President Obama. That would be the arrest of a renowned Harvard university professor who says he was the victim of racial profiling by police. Just a short while ago, the Cambridge, Massachusetts, police commissioner said his department is deeply pained by what Mr. Obama said about the incident last night at the White House news conference.

First, listen once again to what the president said and then the new response by the police.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: Now, I don't know, not having been there and not seeing all the facts, what role race played in that. But I think it's fair to say, number one, any of us would be pretty angry; number two, that the Cambridge police acted stupidly in arresting somebody when there was already proof that they were in their own home; and, number three, what I think we know separate and apart from this incident is that there's a long history in this country of African-Americans and Latinos being stopped by law enforcement disproportionately. That's just a fact.

ROBERT HAAS, CAMBRIDGE, MASSACHUSETTS, POLICE CHIEF: We were deeply concerned.

I think we take -- as I said before, we take our professional pride very deeply. And I think when I talked to the officers throughout the department during the course of the day, you could see that they were really stunned by being -- not having the greatest regard -- or actually taking those comments to heart. So I would say to you that they were -- they were very much deflated.

(END VIDEO CLIP)

BLITZER: President Obama is now responding for the first time about the uproar over his remark last night that the police in Cambridge acted stupidly.

(BEGIN VIDEO CLIP)

OBAMA: I have to say I am surprised by the controversy surrounding my statement, because I think it was a pretty straightforward commentary that you probably don't need to handcuff a guy, a middle-aged man who uses a cane, who is in his own home. Now, what I do know is, as I said last night, I don't know all the details.

(END VIDEO CLIP)

BLITZER: Let's bring in our White House correspondent Dan Lothian for some perspective on what's going on.

So, is he standing by his remark that the police acted stupidly, or is he backtracking a bit?

DAN LOTHIAN, CNN WHITE HOUSE CORRESPONDENT: Well, you see there that the president certainly is standing somewhat by the remarks that he has made in an interview that will air on "Nightline" tonight, but the White House clearly is trying to dial it back a bit, Wolf, there, trying to clarify the president's comments, saying that he was not referring to the officers themselves, not calling them stupid, but was, in fact, talking about the overall situation, that it had gotten too far out of hand.

But, clearly, as have you heard from the Cambridge Police Department and other police officers across the country, they're not very happy about these comments that the president made and don't think that he should have stepped into what they believe is a local issue.

BLITZER: So, how serious could the fallout from all of this be, Dan?

LOTHIAN: Right. Well, this is something we will probably figure out in the rearview mirror, but I was talking to one former law enforcement official today who runs a police foundation. And he told me these are words that he would not have used, and he believes that those are tough very words that, again, law enforcement officials are not looking on too kindly.

But what did he point out is that this does give the president, raising it to this level does shine the spotlight on a situation that is always right below the surface. And that is how minorities feel about police officers and how they're treated.

BLITZER: All right, get inside. It's raining. It's starting to rain pretty seriously over there. Dan Lothian, thanks very much.

The Cambridge, Massachusetts, police officer who arrested professor Gates says he didn't do anything wrong, and he is refusing to apologize. Here is his response to the president.

(BEGIN VIDEO CLIP)

SGT. JAMES CROWLEY, CAMBRIDGE POLICE DEPARTMENT: He is the president of the United States, and I support the president to a point, I guess. I think it's disappointing that he waded into what should be a local issue.

(END VIDEO CLIP)

BLITZER: Cambridge police are defending the arrest in another way. They now say there had been a past break-in over at professor Gates' home, further heightening their suspicions of a possible burglary.

But professor Gates is standing by his claim that he was targeted simply because he's black.

Listen to this.

(BEGIN VIDEO CLIP)

HENRY LOUIS GATES, PROFESSOR, HARVARD UNIVERSITY: What it made me realize was how vulnerable all black men are, how vulnerable all people of color are and all poor people to capricious forces like a rogue policeman. And this man clearly was a rogue policeman.

(END VIDEO CLIP)

BLITZER: By the way, later tonight the second day of CNN's "Black in America 2" airs at 8:00 p.m. Eastern. It looks at some of the most challenging issues facing African-Americans. You're going to want to see this second installment. Once again, it airs tonight at 8:00 p.m. Eastern only here on CNN.

Let's go to Jack Cafferty right now. He has "The Cafferty File" -- Jack.

JACK CAFFERTY, CNN ANCHOR: Interesting Mr. Gates characterized the officer as a rogue policeman. Isn't it true that he spent his time teaching other police officers on the force...

BLITZER: Yes, he spent five years.

CAFFERTY: ... how to do their jobs without doing racial profiling?

BLITZER: That's what we learned today. Five years, he taught that at a police academy.

CAFFERTY: Yes.

Only months after being bailed out by billions, billions, of our taxpayer dollars, Wall Street is on track -- are you ready? They're on track to pay their employees even more than they did before the financial meltdown happened.

"The Washington Post" reports so far this year the top six banks have set aside $74 billion to pay their employees. That's up from $60 billion at this time last year. That was before the bottom fell out. Washington, of course, up in arms with all of this. Lawmakers are blasting these financial institutions for going back to their old ways. They're also promising to pass legislation to increase oversight on Wall Street paydays. Of course, that, will be after their vacation, which is a month long and starts in the next week or so.

In last night's press conference, President Obama said Wall Street hasn't changed its behavior yet. Quoting now: "I would like to think people would feel a little remorse and feel embarrassed and would not get million-dollar or multimillion-dollar bonuses" -- unquote.

All six of the top U.S. banks got federal bailout, or TARP, money last year. Three of them, Goldman Sachs, Morgan Stanley, J.P. Morgan Chase, have since returned those funds, but they do still benefit from other emergency federal programs.

All of these banks, except Morgan Stanley, posted profits this quarter. Some bank executives say that it shouldn't be surprising that compensation goes up when performance improves. Hey, it's called capitalism.

Here's the question. Did Wall Street learn anything from last year's meltdown? Go to CNN.com/caffertyfile and post a comment on my blog -- Wolf.

BLITZER: All right, Jack, thank you.

Your health in stranger's hands. Will a novel idea help your health and your wallet, or will it allow the government to make health decisions for you?

And can you guess the number of swine flu cases in the United States? The truth will likely alarm and astound you. And I will speak about that with Dr. Anthony Fauci at the National Institute of Allergy and Infectious Diseases. He is here in THE SITUATION ROOM.

And are these mules, yes, mules, a threat to your security? Wait until you hear what's happening. One congressman says bureaucratic nonsense is trumping common sense.

(COMMERCIAL BREAK)

BLITZER: It's a tantalizing idea, something the president says will be good for your health and for your wallet.

(BEGIN VIDEO CLIP)

OBAMA: The MedPAC idea is to have health care experts and doctors sit down and figure out, how can we improve Medicare; how can we make it more cost-efficient?

(END VIDEO CLIP)

BLITZER: It's a big proposal pushed by the president involving the establishment of a new council. It would set prices for Medicare reimbursement, but it's hugely controversial already. Time-out for our political discussion. Let's go to our national political correspondent, Jessica Yellin, first of all, part of the best political team.

Jessica, set this up for us.

JESSICA YELLIN, CNN CONGRESSIONAL CORRESPONDENT: OK, Wolf, think of this like going to a restaurant. We are big on the food metaphors here.

Right now, doctors charge Medicare a la carte. So, for every item on the plate, every medical procedure, every doctors visit, every new treatment, there's a separate charge. That ends up costing a lot. Now, this president's council for Medicare would support a sort of combo meal model, so if you have a heart attack, the council would set one package price for your entire treatment.

That's a set fee, no matter how many doctors visits you make. Now, the administration thinks this combo platter idea will actually cut down costs, because there won't be an incentive for unnecessary procedures or for doctors visits that you don't need, and they say it should also lead to higher-quality care because there is, for example, no extra money if the doctor decides, oh, he got it wrong the first time and has to do a follow-up procedure.

So, that's one way the administration thinks this council could squeeze a lot of the bloat out of the system -- Wolf.

BLITZER: Good explanation.

Let's talk about it a little bit with Gloria Borger, our senior political analyst, David Frum, the former White House speechwriter under President Bush, and Candy Crowley, our senior political correspondent.

Is it getting a little too complicated, though, Candy?

CANDY CROWLEY, CNN SENIOR POLITICAL CORRESPONDENT: Well, I can tell you what happens here is that people outside the beltway, as we say, sitting around their table look at this and say, wait a second. So, there's going to be this panel that's going to curtail how doctors treat me.

That's how it's being interpreted. Now, the White House will push back and say, no, no, you can do these things that are necessary. We're just cutting out the unnecessary things.

Well, go talk to any five doctors and ask them what's necessary or not necessary for a patient with the same thing.

BLITZER: It's a good point Candy makes, because a lot of doctors are going to hear these so-called specialists in this MedPAC, or whatever it's called, and they are going to say, you know what? I know what's best for my patient, not this group of outside experts.

DAVID FRUM, FORMER SPEECHWRITER FOR FORMER PRESIDENT GEORGE W. BUSH: Well, the press president has obviously been spending a lot of time talking to health care economists, and they have been since the 1970s saying why do we pay doctors when people get sick? What if we paid them when people stayed well? The incentives are all wrong.

And economists have been worrying for a generation about how to structure incentives properly. What comes out of that, though, people don't always like. This is actually the school of thought that led to the creation of the HMO back in the 1970s. It was going pay to keep you well. When people encounter it, they don't like it so much.

GLORIA BORGER, CNN SENIOR POLITICAL ANALYST: Can I just say, given how dysfunctional Congress is, I think this may be the only way to tee up real cost controls, because what you're doing -- and this is what Congress doesn't like about it -- is, you are taking power away from the Congress, because they right now set these prices.

And they get lobbied by special interests, who sometimes when you want to cut reimbursements to Medicare, politicians don't want to do that. So, I think, in a way, this is just a way to take them out of the process and to say let's have the people who understand these procedures better than the politicians do start to look at them and start to say, this is what they ought to cost.

CROWLEY: But it's also doctors who complain the most about this. You know, it's not -- there may be doctors on the panel, but if you go out and talk to doctors -- and, you know, just for full disclosure, there's two of them in my family -- they -- they look at this as an infringement, and they look at this as another way to cut them out of things that are legitimate costs.

FRUM: Now, ask yourself this. If you're the president of the United States, do you really want to be in the middle of every fight between every funder and every medical provider in the country?

And what President Obama is proposing is, not only is the president going to be in the fight, middle of the fight on Medicare, but, because of this so-called public option, for everybody. And maybe what we need is a depoliticized medical system with a smaller interventionist role by the government. It would make the president's life easier.

BORGER: But bottom line is, the real problem with this is that you don't know how much money it's going to save you, because they can only say we think it's going to save this.

FRUM: Yes, it's all conjecture.

BORGER: But it's all conjecture.

(CROSSTALK)

BLITZER: But we all know at the same time there's a lot of waste out there, a lot of needless testing and retesting. Something has got to be done about that.

Let's go back to Jessica Yellin. What does the administration say about this criticism, though, that the government shouldn't be telling doctors how to treat their patients?

YELLIN: Right, Wolf.

OK, let's use the example of a heart attack. Say you have a heart attack. Critics worry that this council will dictate the medication, the one treatment, the one follow-up pattern of protocol that you could get and that your doctor and you would have no say.

Well, according to administration officials, that's just flat-out wrong. What they say is, your doctor can choose any combination of treatment options you and she consider best. Here's where the council's preference does come in, the price they will pay for that treatment.

So, the council will use the latest data and research to decide that this exact combination of a protocol is the best, and they will price it based on that. Now, you and your doctor can choose to ignore that plan. If you stay under the costs, that's no problem. If you go over, well, the government won't pay the additional price. You will just have to make up the difference -- Wolf.

BLITZER: It's all part of the medical pricing council, the MedPAC, as it's called.

The criticism is already coming in. This is socialized medicine, nationalized medicine, and it's not right for the United States.

CROWLEY: This is also medicine that it creates classes here, because if you are a patient able to pay for the care that your doctor deems best, well, then that's not a problem to make that up. If you are not, you are going to go with what is prescribed by this panel of doctors.

FRUM: Look, Medicare is already socialized medicine, and the idea that we're going to have freedom within Medicare -- many of these debates go back to the Reagan years, when the federal government for the first time created those diagnostic numbers and said, it's -- we're going to charge -- here's a price set per unit.

But what is so frustrating about all this, when President Obama is talking about how do we eliminate waste, how do we make the system more efficient, he could bring 70 percent of the country with him, but he has insisted on crossing these ideological red lines with surtaxes and the public option, where he takes something that could be a 70 percent issue and he turns it into a 50/50 percent issue, and probably will lose.

BORGER: But the point is Congress hasn't done such a good job, OK, so what they're trying to say is there's got to be an alternative to Congress setting these guidelines, because they get lobbied by special interests and they cave all the time. So, maybe setting up an independent commission, empowering them...

FRUM: Regulatory agencies get lobbied, too.

BORGER: Maybe sometimes you need to outsource a little bit to take it out of the political arena.

BLITZER: We are going to leave it there, guys. Thanks very much. Good discussion all around.

They're marketed as a healthy way to smoke.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: It looks like smoke. And it lights up and everything, but it's just steam.

(END VIDEO CLIP)

BLITZER: Guess what? The FDA says these electronic cigarettes also have cancer-causing chemicals. We're going to take you inside the laboratory.

Plus, charged with a shocking crime he was on the run for 15 years. Now the FBI tracks down a suspect from its most-wanted list.

And the first mother-in-law tells a group of schoolkids what's it like to live over at the White House.

(COMMERCIAL BREAK)

(NEWS BREAK)

BLITZER: They're billed as a healthy alternative to cigarettes, but this doesn't sound very healthy at all.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: We found varying levels of nicotine, carcinogens, which are cancer-causing chemicals, and even a poison, and it's ethylene glycol, which is found in antifreeze.

(END VIDEO CLIP)

BLITZER: Wow. Just ahead, we're going to have more on the startling new warnings about electronic cigarettes.

And are healthy officials ready -- are health officials, I should say, ready if the swine flu pandemic gets worse once the children go back to school?

(COMMERCIAL BREAK)

BLITZER: Smokers, beware. What's hailed as a safe alternative to cigarettes may be mainly just as harmful. This is a story you will only see here on CNN.

Let's bring in CNN's Brian Todd.

All right, Brian, explain the background?

BRIAN TODD, CNN CORRESPONDENT: They're called electronic cigarettes, Wolf. I'm going to show you how they work. They come in essentially two pieces. This part is charged with a charger. You essentially assemble it like this. You take a drag.

Now, that is not actual smoke. That is steam. And the people who smoke these and sell them say it's a healthy alternative to smoking. But that pitch is now being seriously challenged by the U.S. government.

(BEGIN VIDEOTAPE)

TODD: (voice-over): From the red flicker to the exhale, it sure seems like the real thing.

LEX LUTHER, E-CIGARETTE VENDOR: It looks like smoke and it lights up and everything, but it's just steam.

TODD: Electronic cigarettes have been marketed for at least two years as a healthy way to smoke because they don't contain the tar and chemicals in regular cigarettes. But after some initial tests, the Food and Drug Administration now says watch out.

DR. JOSHUA SHARFSTEIN, FDA PRINCIPAL DEPUTY COMMISSIONER: We found varying levels of nicotine, carcinogens, which are cancer- causing chemicals, and even a poison in it, the ethylene glycol, which is found in anti-freeze.

TODD: But the FDA found that anti-freeze ingredient in just one out of 19 cartridges tested.

Contacted by CNN, a group representing several manufacturers sent a statement saying the FDA study is "too narrow to reach any valid and reliable conclusions."

James Jackson says e-cigarettes helped him quit smoking after 37 years. Now he sells them and echoes what a leading manufacturer told us.

JAMES JACKSON, E-CIGARETTE VENDOR: There's never been one single death or serious health incident with electronic cigarettes. But people are dying every day from tobacco.

TODD: There's no tobacco in e-cigarettes, but they do have the addictive substance, nicotine, in liquid form.

How does they work?

CNN got exclusive access to a lab at Virginia Commonwealth University that tests smoking alternatives for the government.

THOMAS EISSENBERG, VIRGINIA COMMONWEALTH UNIVERSITY: There's two separate parts, the atomizer and the battery. The battery is in here. And then after you've used it for a while, you'll need to recharge the battery. And it comes with a charger. TODD: The FDA has a huge problem with the way they're marketed. These cigarettes, the agency says, come in flavors like cola, bubble gum, chocolate.

(END VIDEO TAPE)

TODD: You know what that means. Like regular cigarettes used to be, these could -- they could be marketed toward children and right now they are not regulated. They are sold at kiosks in malls, among other places. But that association representing some of those manufacturers told us it does not approve of them being sold at kiosks -- Wolf.

BLITZER: Here's the question -- what can the FDA really do about this?

TODD: Well, the FDA official we talked to said right now they're starting to seize the shipments of these things at the border on the grounds that they're not approved drugs. He said they could maybe pursue some recalls, possibly even take some criminal actions. They want to do more testing. He says it's a little bit premature to talk about some of those things right now, but those are some of the things they could do in the future.

BLITZER: All right. A good report.

Thank you.

We'll watch it.

Meanwhile, scientists are set to begin human trials on a new swine flu vaccine starting early next month. The National Institutes of Health says it's trying to beat the upcoming flu season. Will health officials -- they'll be ready for the worst this fall and winter.

Listen to the Education secretary, Arnie Duncan.

(BEGIN VIDEO CLIP)

ARNIE DUNCAN, EDUCATION SECRETARY: We got a little bit lucky last year, frankly, where this didn't hit until late in the school year. We are not going to be lucky going into this school year. It's going to -- we have to be ready now.

(END VIDEO CLIP)

BLITZER: All right. Let's -- let's talk about this with Dr. Anthony Fauci.

He's the director of National Institute of Allergy and Infectious Disease here in Washington.

Tom Foreman is here for this segment we like to call Chalk Talk.

Are we ready? DR. ANTHONY FAUCI, NIAID DIRECTOR: Well, we hope to be ready and I think we will be. Right now, as we've announced yesterday, we're going start in the first or second week in August the clinical trials that will give us the information about what is the right dose, how many doses should we use, what is the response to the vaccine in younger people versus older people, things like that. We need to know that to be prepared to launch a vaccine implementation campaign in the fall if the secretary deems that that's the way to go.

TOM FOREMAN, CNN CORRESPONDENT: Let's talk about what was happening back in the spring...

FAUCI: Right.

FOREMAN: -- because this -- I think the numbers are astonishing. Look at this. This is back in April. This is where we had cases. In the United States, you only had about 20 cases. We weren't talking about fatalities. They had some in Mexico, some in Canada. That was it back then -- fairly limited. We're not talking about a whole lot of spread here.

A lot of warnings at that time. We all remember we were being told that we might have to limit the people getting on flights going places. We were talking about all sorts of things like that.

But, in the end, this is where we are today. Now, we're talking about more than 40,000 cases, more than 230,000 deaths already. And that would...

(CROSSTALK)

FAUCI: Two hundred and sixty two deaths.

FOREMAN: Two hundred and thirty-two. I'm sorry...

(CROSSTALK)

FOREMAN: But a tremendous number of people have already...

FAUCI: Right.

FOREMAN: -- compared to what we were talking about before. This is enormous compared to before.

FAUCI: Right.

FOREMAN: And now, we're not talking so much about closing the schools or keeping people off airplanes.

But should we be?

FAUCI: No, because it's here. Once it's here, it's spreading like a virus that's going into what we call a naive population. This is a new virus that most people don't have what we call background immunity to. It appears that older people, people who are in their 60s or so, who may have been exposed or to similar type viruses in the past, the reason it's, in essence, targeting younger individuals is because they've never seen this virus or even a related virus, where older people may have.

So when you have a naive population and you get a virus like influenza that just loves to spread from person to person, this is what you see. This is not surprising.

BLITZER: Well, are you saying there already is a vaccine, it's ready to go once the flu season hits here?

Because we're not in a flu season now and you already hear at camps and other places, there's a serious problem.

FAUCI: I'm not saying that. What I'm saying is that the plan of getting vaccine doses ready to go, our goal is to have them ready by mid-October. We're starting the clinical trials now with what we call pilot lots. We'll be starting literally in a couple of weeks, asking the questions, what's the right dose, because if you have a vaccine that you've not given before, you want to make sure the dose is right, the number of doses, the kinds of response.

BLITZER: And you have to make sure that it doesn't mutate, the virus...

FAUCI: Right.

BLITZER: ...between now and October, the flu season in the Northern Hemisphere.

FAUCI: Right. That's always a possibility, Wolf. But what we're seeing, interestingly, is that this virus, if you look at its molecular genetic makeup of what we saw in April and what it's doing right now, several months later, not only here, but in the Southern Hemisphere, it looks essentially identical. So it doesn't have much pressure to mutate.

When it sees a lot of naive people -- immunologically naive, there's no pressure for it to mutate. So it's spreading rapidly, but it doesn't seem to be changing.

FOREMAN: What else do we need to know about this?

Right now, you're in the vaccine testing phase.

FAUCI: We would start it in Oct -- in August.

FOREMAN: OK. So we're very close to that.

Secondly, I guess we need to know what Wolf mentioned earlier -- now is the time. We're moving into the season and it's flu time.

FAUCI: Right. Right.

BLITZER: In the fall.

FAUCI: In the fall. When kids -- when you -- whenever you have a respiratory illness like this, it tends to spread where you have conditions where you put people who are not immune to it together. That's why we saw it in the schools.

You remember the stories what we saw in New York City with the schools?

We see it in summer camps. So unless something changes -- which we're not going to presume it is -- it is very likely we'll see it in the schools in the school year...

BLITZER: So we'll see a lot of people getting sick.

But this doesn't look like it's a major killer, is that right?

FAUCI: It doesn't. It -- it is generally considered to be a mild to moderate influenza, similar to what would be a mild to moderate seasonal flu. The one thing that there is some concern is that there seems to be some young people who are otherwise well who seem to be getting very sick. Not a lot of them. I mean if (INAUDIBLE)...

BLITZER: When you say young, what do you mean?

FAUCI: Well, we see people in their late teens, early 20s, 20s, 30 or things like that. You don't usually see people who are otherwise well -- on a flu season -- and I think people should appreciate this. On a regular yearly flu season, there are 36,000 deaths. Overwhelmingly, they're in people who are elderly, pregnant women and very, very young infants. We're seeing some young adults who are getting sick, which is worrisome.

FOREMAN: Why did we reach the point of being able to say this is mild to moderate, because we all remember back in April, when the numbers were low, the warning was this could be so bad?

FAUCI: Well, the reason the warning was because it was a new virus that we have not seen before. And as it started to spread, it was declaring itself that most of the people were getting mild disease. You'd have an occasional situation where someone would get very sick and even die. But for the most part, in the totality of cases we've seen, it's acting like a relatively mild to moderate influenza, not an overwhelming (INAUDIBLE).

BLITZER: I've read reports that young people are especially at risk...

FAUCI: Right.

BLITZER: ...and pregnant women are especially at risk.

FAUCI: Right. That...

BLITZER: So if you're young or pregnant, what do you do?

FAUCI: Well, if you're young or pregnant, that's the reason why, when we're looking at the vaccine and we're trying to find out what the right doses are, we're going to be looking at the people who would be most susceptible.

Certainly, in any flu season, pregnant women are more prone to the complications. Usually, you have older people who really get very sick.

In this situation, since so many of the children are essentially naive to this, those are the ones that the virus seems to be targeting, which are the ones that we're going to want to vaccinate.

FOREMAN: And, lastly, is it -- is it just the usual precautions that you want to avoid?

Because people out there are concerned. They young children. They want to be safe.

FAUCI: Right.

FOREMAN: What should they be doing this fall?

FAUCI: The CDC has been so explicit in getting a real clear message out about what you need to do. When you are sick, you don't go to school. When you are sick, you don't go to work. You should be good at pulmonary hygiene -- cover yourself when you cough, wash your hands frequently. Those are things you would do in any influenza. Certainly, you'd want to do that right now.

So pay attention to the CDC's precautions.

BLITZER: And, very quickly, is it too early to tell pregnant women don't go on trains, buses or...

(CROSSTALK)

BLITZER: ...or...

FAUCI: You don't want to say that. That's not...

BLITZER: Not ready yet?

FAUCI: Well, I'm not sure we'd even ever say that. But right now, that's not the situation.

Doctor Fauci, as usual, thanks very much.

FAUCI: No problem.

BLITZER: And thanks for all the service you've done over many years.

(CROSSTALK)

FAUCI: Thank you.

BLITZER: We appreciate it very much.

FAUCI: Thank you. BLITZER: Tom Foreman, as usual, thank you.

FOREMAN: Thank you, Wolf.

BLITZER: Their job -- taking tourists on an historic barge ride.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: Well, the only thing they ask for is a couple of meals a day and a new pair of shoes every year.

(END VIDEO CLIP)

BLITZER: Why does the Department of Homeland Security insist that these mules and their historically costumed handlers need to have anti-terror I.D. cards?

And classroom pranks, from cartoon characters to a pretend torture victim -- Jeanne Moos finds it all Moost Unusual.

(COMMERCIAL BREAK)

BLITZER: In our look at broken government, they reenact America's past for tourists.

So what do some hardworking mules and their costumed handlers have to do with modern terrorism concerns?

Our homeland security correspondent, Jeanne Meserve, looks into that -- Jeanne.

JEANNE MESERVE, CNN HOMELAND SECURITY CORRESPONDENT: Wolf, let me introduce you to Hank and also to George. Believe it or not, the federal government believes these two mules and the work they do may pose some kind of security threat.

(BEGIN VIDEOTAPE)

MESERVE: (voice-over): It's hard to imagine many things more peaceful than a leisurely barge boat ride on Pennsylvania's historic Lehigh Canal. But the long arm of homeland security has stretched even here.

MAYOR SAL PANTO, EASTON, PENNSYLVANIA: It has nothing to do with international security or national security. It has to do with some tourism and letting people relive our historic past. It's certainly no threat to national security.

MESERVE: The mayor is upset that four historic re-enactors at the Hugh Moore Historical Park who handle the boat and the mules that pull it had to go through the bother and expense of getting secure credentials called Transportation Worker Identity Cards or TWIC.

CHRIS SZARKO, MULE TENDER: So, actually, it is ridiculous, when you get right down to it.

MESERVE: The cards were mandated for all mariners after 9/11 to ensure that port workers are not terrorists.

So what needs protection around here and who exactly are the terrorists?

LANCE METZ, HISTORIAN, NATIONAL CANAL MUSEUM: So our biggest threat is not the threat of man, it's the threat of the weather, the threat of natural forces -- and muskrats.

MESERVE: The mules, Hank and George, certainly don't appear to be security risks.

PANTO: Well, the only thing they ask for is a couple of meals a day and a new pair of shoes every year.

MESERVE: And as for the mule tenders, despite the hassle of going through federal background checks, they're largely amused at having their little tourist attraction treated like a major port.

SUE FRANCISCO, MULE TENDER: We catch some little fish in the nets as well as the big ones. And nobody threw us back.

MESERVE: The park had to divert $1,200 from its educational programs to pay for the cards. Five months ago, the local congressman urged the Homeland Security secretary to find a commonsense solution.

JANET NAPOLITANO, HOMELAND SECURITY SECRETARY: Let's work with you on this particular case, if we might.

MESERVE: But it hasn't happened.

COMMANDER DAVID MURK, U.S. COAST GUARD: The law is very clear. It's required for all U.S. license and documented mariners, which does not give us any leeway to -- to make exemptions.

REP. CHARLES DENT (R), PENNSYLVANIA: This makes absolutely no sense. This is simply a case of bureaucratic nonsense trumping commonsense.

MESERVE: Congressman Dent is proposing legislation giving small operations like this an out.

(END VIDEO TAPE)

MESERVE: But for now, the requirement for TWIC cards stands. And some call that asinine -- Wolf, back to you.

BLITZER: Thanks very much for that, Jeanne.

Let's check in with Lou Dobbs to see what's coming up at the top of the hour -- Lou.

LOU DOBBS, HOST, "LOU DOBBS TONIGHT": Wolf, thank you.

Tonight, an interesting show. We'll have complete coverage of a major setback for the president's health care initiative. Senate Majority Leader Harry Reid saying there will be no Senate vote before the August deadline. It could be a pivotal point for the health care debate and the presidency of Barack Obama.

Also, the confrontation over the arrest of a black Harvard professor is escalating after the president said Cambridge, Massachusetts police acted, in his words, "stupidly." We'll have the very latest for you.

And the liberal media launching an all-out attack against me for simply calling for transparency on the issue of the president's birth certificate. Even though I had said that the president is a U.S. citizen, I haven't been quoted by the left-wing. We'll be examining that controversy and our face-off debate here tonight.

Join us for all of that, all the day's news and much more, for what is looking like a very interesting show at the top of the hour -- Wolf, back to you.

BLITZER: All right, Lou.

Thanks very much.

Jack Cafferty is asking this question -- did Wall Street learn anything from last year's meltdown?

Your e-mail -- that's ahead.

And a perfect game -- one of baseball's once in a blue moon rarities. And it's all the more perfect for President Obama because the winning pitcher is from his favorite team.

(COMMERCIAL BREAK)

BLITZER: It hasn't happened in five years. The White Sox pitcher, Mark Buehrle, threw a perfect game today, to lead Chicago to a 5-0 win over Tampa Bay. But it almost didn't happen. Take a look at this video. Watch it.

The center fielder, DeWayne Wise, reaching over the wall to save the home run in the ninth inning. Look at this catch. Wow! There it is. He did it. He saved the perfect game for the pitcher.

President Obama, by the way, is a huge White Sox fan. He called Mark Buehrle to congratulate him.

Let's go to Jack Cafferty right now for The Cafferty File -- a pretty good catch.

CAFFERTY: A great catch. He covered a lot of ground to get to the wall, too.

BLITZER: Yes.

CAFFERTY: A perfect game is, what, 27 up, 27 down, right?

BLITZER: Right. Nobody gets walked...

CAFFERTY: No runs, no hits... BLITZER: No errors.

CAFFERTY: ...no walks, no nothing.

BLITZER: It's much better than a -- than a no hitter.

CAFFERTY: Yes. You can pitch a no hitter and you can...

BLITZER: Yes.

CAFFERTY: ...you can actually lose a no hitter if you walk a couple of batters and then there's an error or two and -- do we have time to do this?

No, we don't.

BLITZER: No.

CAFFERTY: The question is, did Wall Street learn anything from last year's meltdown?

Russ in St. Paul writes: "Of course they didn't. We bailed them out. The only way you learn from failing is actually being allowed to fail. It's sort of like giving $1,000 to a friend with a gambling addiction and then being surprised to hear he blew the money at the track."

Gary in Arizona writes: "Certainly not. No more than the political hacks at all levels who have cheated on their wives. They never seem to learn either. Money, like sex, corrupts. And the Wall Streeters are no different than politicians. They just have a different objective. Investors should sleep with one eye open."

Carolyn in California: "Absolutely. They learn if fleecing their investors takes a turn for the worse, they can turn around and fleece the government and the taxpayers."

Linda in Sante Fe, New Mexico: "No, they didn't learn anything. Until there's either some sort of regulation preventing excessive compensation or some legislation making it mandatory for shareholders to approve compensation packages, they'll keep doing as they have been. And there won't be any legislation for at least a month, because, hey Congress is going to take August off."

C. in Alabama: "Wall Street is the greatest evil on this planet. It is a cesspool of greedy, malevolent old profiteers. They are incapable of learning anything that doesn't fill their pockets with more money."

Hank writes: "They learned that if they screw things up badly enough, the government will give them money."

And James in Idaho writes: "No, Jack, Wall Street didn't, but I sure did. My community credit union never looked so good."

If you didn't see your e-mail here, that's because we didn't want to read it.

(LAUGHTER)

CAFFERTY: And now back to our -- our ace right hander, fastball extraordinaire, Mr. Blitzer.

BLITZER: No perfect game, no (INAUDIBLE).

All right, Jack.

Thank you.

CAFFERTY: See you tomorrow.

BLITZER: You, too.

Classroom pranks are nothing new, but what happens when the prank is all about torture?

(COMMERCIAL BREAK)

BLITZER: All right. There are pranks and then there are pranks.

But what if the classroom disruption centers around torture?

CNN's Jeanne Moos checks out this Moost Unusual classroom caper.

(BEGIN VIDEOTAPE)

JEANNE MOOS, CNN CORRESPONDENT: (voice-over): Classroom pranks normally involve interruptions by characters like Pacman...

(VIDEO CLIP)

MOOS: ...or a banana being chased by a gorilla.

(VIDEO CLIP)

MOOS: Or Superman.

UNIDENTIFIED MALE: What?

I'll be right there.

MOOS: But instead of a red cape, imagine a black hood.

Remember this iconic photo of a detainee at Abu Ghraib?

Well, the former Bush official who wrote memos authorizing so- called "enhanced interrogation" got interrupted while teaching by his own interrogator.

JOHN YOO: Talk about, um, Constitutionality. Any questions about how this works?

UNIDENTIFIED MALE: Actually, professor, I've got one question. How long can I be required to stand here until it counts as torture?

YOO: Unfortunately, I'm going to have to end the class.

MOOS: John Yoo was a visiting professor teaching international law at California's Chapman University.

YOO: Sorry about this, people.

UNIDENTIFIED MALE: If this is awkward for you, it's very uncomfortable for me, I can tell you.

MOOS: His tormentor was from an Australian comedy show called "Chaser's War on Everything."

UNIDENTIFIED MALE: I'd love to move but every time I do my (EXPLETIVE LANGUAGE) get buzzed.

MOOS: Most of the laughter came from a studio audience watching the video.

(on camera): The torture prank was pretty simple compared to some of the show's past exploits. For instance, the time they crashed a summit.

(voice-over): Their mock motorcade, complete with jogging security agents, got through a couple of checkpoints. Then a fake Osama bin Laden jumped out and was arrested.

Another time they bought airline tickets under the names Terry Wrist, as in terrorist, and Al Kyder. Then they got themselves paged.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: Al Kyder.

(LAUGHTER)

(END VIDEO CLIP)

MOOS: They've commandeered airline microphones.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: Your attention please, ladies and gentlemen. If there are passengers in the terminal who know how to fly a plane, could you please?

(END VIDEO CLIP)

MOOS: And now they've commandeered a class. Professor Yoo didn't return our call, though students on a law school blog defended him, saying: "He's one of the best professors I have ever had."

YOO: And I'll give you a certain amount -- amount of time before I report it to the security.

UNIDENTIFIED FEMALE: Excuse me, but non-class members need to leave now.

UNIDENTIFIED MALE: All right. OK. I'll go to the human rights classroom down the road.

UNIDENTIFIED FEMALE: This is a private classroom.

MOOS: It's easy to laugh when your class is crashed by Pacman, but not when you're tortured by satire.

Jeanne Moos, CNN, New York.

(END VIDEO TAPE)

BLITZER: And remember, we want you to check out our political podcast. To get the best political team to go, subscribe at CNN.com/situationroom.

I'm Wolf Blitzer in THE SITUATION ROOM.

Up next, "LOU DOBBS TONIGHT" -- Lou.