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Critics: Strip State Dept. of Big Job; Complicated Maze of Congressional Panels; Dems Plot Next Health Reform Moves; Google Launches Phone War; Arctic Blast Moving In

Aired January 5, 2010 - 17:00   ET

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


CAFFERTY: Tom in Florida says: "Probably. The terrorists are likely to be way ahead of us by choosing radicalized Westerners to do their dirty work in the future. I'm 66. I still remember the misguided but dangerous youth of the 1960s. They weren't Middle Eastern."

And Misty writes from Shawnee, Oklahoma: "Of course, we ought to start profiling. There's an obvious pattern with these terrorists. Flying is a privilege these days, not a right. If you don't like the rules, take a bus or a boat. I don't want to be blown out of the sky."

If you want to read more about this subject, you can at my blog, CNN.com/caffertyfile -- Wolf.

BLITZER: Will do.

Jack, thank you.

And to our viewers, you're in THE SITUATION ROOM.

Happening now, President Obama gets an update and gives an update to the American public on the airliner bombing plot. But while the president angrily says the system failed to head-off a potential disaster, the White House plays up what it calls "actionable intelligence" gained from the suspect. We have new information.

Recruited by Jordanian intelligence and then shared with the CIA, a double agents betrays both agencies. There are now new details on how he managed to kill eight people inside a U.S. spy base in Afghanistan.

And planning the next move on health care reform -- President Obama and Democratic leaders trying to figure out how to get one bill out of two very different measures that passed the House and the Senate.

I'm Wolf Blitzer.

You're in THE SITUATION ROOM.

New details are emerging right now about that bloody suicide bombing in Afghanistan, where a double agent who had gained the trust of Jordan and U.S. intelligence managed to penetrate a CIA base, killing eight people.

Let's go live to our Pentagon correspondent, Chris Lawrence.

He's watching what's going on -- all right, Chris, tell our viewers some of the new information we're learning, specifically how the CIA -- the CIA found this guy.

CHRIS LAWRENCE, CNN PENTAGON CORRESPONDENT: Well, they got the information on him through the country of Jordan, Wolf. This is a Jordanian doctor by the name of Human Khalil Abu-Mulal Al-Balawi. He had been arrested by Jordan authorities more than a year ago because of some suspicious activity. But the Jordanian officials didn't have enough evidence to hold him, so they let him go.

That's when the man moved to Pakistan for what he claimed was studying and he started to send e-mails the Jordanian officials, tipping them off to certain plots and plans by al Qaeda that were targeting not only Jordan, but certain Western targets, as well.

The Jordanian officials started sharing that information with -- with their allies, including the United States. So over the course of a year, he is building up a relationship of trust. In fact, one former senior U.S. intelligence official says he was providing very important information on some very high level targets...

BLITZER: How did...

LAWRENCE: -- Wolf.

BLITZER: How did he wind up inside this base, unsearched?

LAWRENCE: Well, again, think about that. You've got a year now where they're building up this trust. They thought that he had given up his extremist beliefs, that he had come over, that he was possibly -- could be working with them. In fact, we're told that they were going to use him to try to target Ayman Al Zawahiri, you know, the number two man in Al Qaeda -- so a very high level target.

What happened was in Afghanistan, they met with this man outside of the forward operating base. They put him in a car, but they did not search him when they put him in the car.

And so the intelligence officers drove him personally onto the base. Once they got on the base, he was surrounded by a small group of intelligence officers. They were going through the debriefing, questioning him, trying to learn more. And that's when he detonated a suicide vest, killing seven CIA officers and a Jordanian military official who had been working with them.

It's not only a devastating personal loss for those families involved, but, Wolf, with so many agents there, the U.S. now loses their -- their expertise in that part of the country.

BLITZER: It's the worst -- the worst death toll that we know of for the CIA since the 1983 Beirut bombing. The CIA lost a lot of officers, as well. All right, thanks very much.

Chris Lawrence over at the Pentagon.

Recruited by Jordan intelligence and then shared with the CIA -- a double agency betrays both agencies, killing eight people on a CIA base in Afghanistan. It's a plot with multiple layers and plenty of intrigue. And in some ways, it even echoes a recent spy novel turned into a major hit movie.

Joining us now is "The Washington Post" columnist David Ignatius. He's the author of that novel, "Body of Lies." He knows a great deal about this subject.

David, thanks for coming in.

DAVID IGNATIUS, AUTHOR, "BODY OF LIES": Great to be here, Wolf.

BLITZER: All right. Give us your initial assessment of what happened at that base in Afghanistan.

IGNATIUS: Well, you'd have to say this was a masterful operation. This is...

BLITZER: This double agent?

IGNATIUS: This double agent, who probably really was a triple agent. This is a man that the Jordan intelligence service -- very competent, a very close ally of the U.S. -- had -- had worked with for the past several years, had believed was ready to penetrate Al Qaeda at a very high level, sent him there into the Afghanistan/Pakistan area. And he -- he comes back to meet his handlers and, you know, he appears to have been turned, once again. So that the person they thought was reliable is now operating against the -- against them.

He isn't searched. It's fairly typical, I think, for agents to say to their -- to their handlers, don't you trust me?

You know, they want to be accepted as part of the family. He gets in without being -- without being searched.

To me, a troubling aspect of this is in -- in spy novels that I write, but in -- in real life, spy work, it's typical to go outside of an embassy or a military base and meet your contacts at a safe house, as they're often called -- some -- some neutral location where you can reduce the number of people, the visibility and the risk. In this case, that...

BLITZER: Was the trade craft just poor here?

IGNATIUS: I believe that -- that you can -- I would argue that the trade craft was poor. For some years, in both Iraq and Afghanistan, to reduce the -- the risk of vulnerability for our CIA officers, it's been increasingly typical that they don't leave these military bases or the Green Zone in Baghdad. The -- the agents come into them. And a lot of people have argued that that's a bad idea, it's insecure. I think in light of this, there will be some changes in trade craft. Really, the CIA needs trade crafts specialized for this environment. This is not the cold war. It's not Moscow. It's different.

BLITZER: He seemed so potentially useful -- a medical doctor from Jordan. And the U.S. CIA has very good relations with Jordan intelligence, as you well know. And he seemed to be giving information about the number two guy in al Qaeda, Ayman Al-Zawahiri.

Was it too enticing, in -- in effect?

IGNATIUS: I think it's a -- it's a case of a -- of a very clever adversary. We have to realize how smart al Qaeda is. They were holding a bauble in front of us that was just so enticing. This was precisely what would make us jump. Here's somebody who claims to have information about the location of Aman Zal -- al-Zawahiri, the -- you know, the key target we've been going -- we've been going after with bin Laden. And it was irresistible. And -- and, as a result, eight people are dead.

And again, if you want something that badly, you make yourself vulnerable. And I think we have to be careful about that. The whole country would love to see bin Laden and Zawahiri brought to justice, but not at the -- not at the price of making our own people vulnerable.

BLITZER: It dawned on me and I'm sure on you that Ayman Al Zawahiri is a medical doctor, also, just like this double or triple agent. And the fact that an educated person like that could become a suicide bomber, what does it say to you?

IGNATIUS: It says the same thing as the Abdulmutallab case. Many of these cases involve very educated people, people who really, you know, are at the elite of their societies who, for whatever reason, have become disaffected -- deeply disaffected.

Zarqa, the place in Jordan that this man is said to be from, has been a special center for people like this -- people who -- who've prospered as the Jordan economy has prospered, but have -- have felt left out and are easy targets for recruiters. This is something we really have to think about, because prosperous, educated Muslims are all around us here in America, in Britain. They're -- they're people who are our friends, neighbors, fellow citizens.

Somehow, they have to help identify people as this -- as Abdulmutallab's father did, by saying I'm worried about my son, I'm worried about my friend, I'm worried about my neighbor, because that's the only way, really, that people are going to have a handle on it.

BLITZER: And let's not forget that Abu Musab al-Zarqawi, the former leader of Al Qaeda In Iraq, was Zarka in Jordan him -- himself. So there is a history there.

David Ignatius of "The Washington Post," thanks very much for coming in.

IGNATIUS: Thanks, Wolf.

BLITZER: Jack Cafferty has The Cafferty File in just a moment.

Also, the man accused of trying to bomb a U.S. airliner on Christmas Day was badly burned in that attempt. Now, we're getting new information on his condition. We'll share it with you.

And plotting the next move in health care reform -- Congressional Democratic leaders about to huddle over at the White House with the president.

And a phone war breaks out with Google firing the first shot at Apple -- it's superphone versus the Smartphone. We'll tell you what's going on.

(COMMERCIAL BREAK)

BLITZER: Lots of news breaking out here in Washington as the sun goes down over the U.S. Capitol. We'll check you -- check in with what's going on in just a moment.

But let's check in with Jack Cafferty right now for The Cafferty File -- Jack.

CAFFERTY: A beautiful shot. Have you noticed, the days are just ever so slightly getting longer now. I think the shortest day of the year was December 21st. So we're -- we're on the downhill side of that deal.

BLITZER: Yes.

CAFFERTY: The answer to the nuclear stand-off in Iran may lie in the bloody 7-month-old pro-democracy protests that are spreading across the streets of that country. Last week, Tehran saw some of the most violent clashes between demonstrators and government security forces. These are clashes that left at least eight people dead.

And since then, hundreds of thousands of protesters are holding rallies all across the country. Iranians are climbing to their rooftops at night and screaming "Death to the Dictator!" and "Death to Khameini!"

President Obama said the Iranian regime is engaged in a violent and unjust suppression of its citizens, who want nothing more than to exercise their universal rights. Obama says the regime is using the iron fist of brutality and governing through fear and tyranny.

Meanwhile, Iran blew off President Obama's January 1st deadline at making progress on the nuclear issue. The U.S. insists Iran wants to build nuclear weapons, while Tehran says its nuclear activities are for peaceful purposes.

The end of the year deadline came and passed and nothing happened. Secretary of State Hillary Clinton says the U.S. is open to further negotiations with Tehran and that new sanctions are also possible. Those are two things that have worked so well in the past, remember?

But some suggest that the best way to deal with the nuclear issue in Iran is to empower these democratic protesters, instead of offering economic and political incentives to the country's rulers and continuing endless negotiations with the government. They say the U.S. ought to get behind the opposition, which is determined to topple that government.

So that's the question -- when it comes to Iran's nuclear ambitions, is supporting pro-democracy protesters a better option than negotiating with the Iranian government?

Go to CNN.com/caffertyfile and post a comment on my blog -- Wolf.

BLITZER: This is a sensitive, sensitive and very fluid situation, Jack, as you point out, in Iran right now.

Thank you.

By the way, there's another way for all of you to follow what's going on behind-the-scenes here in THE SITUATION ROOM. I'm on Twitter. You can get my Tweets at Twitter.com/wolfblitzercnn -- all one world.

Flashing anger after a top level briefing over at the White House on the Christmas Day airliner bomb plot. President Obama says the system failed in a major, major way. But the White House is playing up some apparent success in the questioning of the bombing suspect.

Listen to this.

(BEGIN VIDEO CLIP)

ROBERT GIBBS, WHITE HOUSE PRESS SECRETARY: Abdulmutallab spent a number of hours with FBI investigators in which we gleaned usable, actionable intelligence. The decision to -- a decision was made in this case similar to previous decisions that have been made with Richard Reid, with Zacarias Moussaoui, with Jose Padilla. The -- the FBI investigators believe they got useful information from this terrorist.

(END VIDEO CLIP)

BLITZER: Brian Todd has been digging some new details on the suspect's condition and treatment following his arrest.

What are we learning right now?

BRIAN TODD, CNN CORRESPONDENT: Well, Wolf, the comment by Robert Gibbs about actionable intelligence gleaned from the suspect, that's a key component of this. A law enforcement official we spoke with yesterday would not comment when we asked if Abdulmutallab was cooperating right now. According to a law enforcement bulletin obtained by CNN, he did give information to U.S. officials very early on. This bulletin the night of the attempted bombing said: "The subject is claiming to have extremist affiliation and that the device was acquired in Yemen, along with instructions as to when it should be used."

And we do have new information on the suspect's treatment at the moment. The director of the federal correctional facility in Milan, Michigan, south of Detroit, where Abdulmutallab is being held, says the injuries he got in the incident continue to be treated and monitored. He would not discuss the specifics of that injury. It is believed that Abdulmutallab suffered burns resulting from his alleged attempt to light an explosive on that plane. This official also wouldn't talk about the conditions of the suspect's confinement.

But we have new details about the facility. This is a federal prison -- a low security facility. In addition to the main building, there is also a 260 bed detention center that is separate. The director would not tell us which building Abdulmutallab is in right now. The director says that he's been there since December 27th and is getting three meals a day -- Wolf.

BLITZER: What kind of crimes are the inmates there normally convicted of?

TODD: The crimes for inmates there cover a very broad range. They are all federal crimes. Some of inmates are serving lengthy sentences. Some of them are just starting their sentences based on security level.

Now, although this is a low security facility, officials have said that they are going to great lengths to ensure that the required security is there for each inmate based on the need. You can assume this suspect is probably pretty heavily guarded.

BLITZER: Yes. I'm sure he's watched 24...

TODD: Absolutely.

BLITZER: ...24/7.

TODD: Right.

BLITZER: There's no doubt about that.

All right. Thanks very much, Brian.

President Obama, as you saw live here in THE SITUATION ROOM, visibly angry at the failures in that Christmas Day bomb plot.

But what has the administration learned?

We're going to go behind-the-scenes and speak with the chief of staff for the National Security Council, Denis McDonough. He was there in the White House Situation Room for that meeting. Also, Democrats are gearing up for the next big battle over health care reform -- details of a high level huddle this hour over at the White House.

(COMMERCIAL BREAK)

BLITZER: Just a short while ago, President Obama came out of a briefing on the failed airliner bombing, spoke angrily of the widespread breakdowns in preventing what could have been a huge, huge disaster.

Listen to the president.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: When a suspected terrorist is able to board a plane with explosives on Christmas Day, the system has failed in a potentially disastrous way. And it's my responsibility to find out why and to correct that failure so we can prevent such attacks in the future.

(END VIDEO CLIP)

BLITZER: Let's get some more on what the Obama administration has learned about the attempted bombing and how it plans to head off other potential attacks.

Denis McDonough is the chief of staff for the National Security Council.

He's joining us from the White House.

He himself participated in the president's strategy meeting over at the Situation Room in the West Wing.

Denis, thanks very much for coming in.

DENIS MCDONOUGH, CHIEF OF STAFF, NATIONAL SECURITY COUNCIL: Thanks for having me, Wolf.

I'm glad to be here.

BLITZER: Without divulging classifying information, take us into that meeting.

How angry was the president?

MCDONOUGH: Well, I think, as you just played in that snippet of his remarks, I think that he recognizes he has a solemn responsibility as the president to ensure this country is kept safe, that everybody here is security. And I think, frankly, that that was the sense that permeated the meeting.

The president himself recognized that we can do better. Each of the people in the meeting took responsibility and recognized that they, too, can do better. So we're going to make sure that this intelligence is correlated, analyzed and put in its proper context here going forward.

We're learning an awful lot about new techniques and new tactics that Al Qaeda is going to try to employ. And we're obviously mindful, as we are everyday, that they intend to attack us here in the homeland. And we're going to stay on our game to make sure -- even up our game, as many of the participants in the meeting suggested, to ensure that they're not going to be successful in doing that.

BLITZER: When you say each of those responsible took the responsibility for the failures did anyone submit or offer to resign?

MCDONOUGH: You know, Wolf, no, nobody did. And -- but the bottom line is this. A lot of people weren't pointing fingers or trying to do any kind of blame game around the table. And that's exactly the atmosphere that the president tried to portray. And I think that's exactly the atmosphere that permeated the meeting.

The bottom line is people are trying to get the answers and making sure that we're better, not getting into some kind of classic Washington blame game or pointing the finger or any of that kind of business, but rather making sure that we're upping our game, as many, as I said, indicated they intend to do, and ensuring that we stay one step ahead of these extremists, these terrorists who threaten us here.

BLITZER: He said: "The U.S. government had sufficient information the intelligence community failed to connect the dots. This is not acceptable and I will not tolerate it."

What -- give us one example of an immediate change in the intelligence community that the president ordered.

MCDONOUGH: Well, one of the things that -- and this isn't necessarily even the result of an order, but this is the result of many people around the table recognizing that they can do things even better than they already do.

I will just hasten to add, and it's something you've reported quite a bit on, Wolf, is obviously these -- this case of Zazi, this case of David Coleman Headley, this case of the five guys going to Pakistan, these are all instances of great cooperation and recognizing that our system can and has worked very well in the past, but making sure, for example, that the most recent and up to date information is pulsed against existing databases to ensure that all these watch list decisions are made with the most up to date and most recent information, informed by our understanding of the threats that Al Qaeda poses and obviously drawing on even some of the information that our international partners give us.

Those are the kind of steps that the president outlined today. And, frankly, those are the kind of steps that are being implemented here as we speak.

BLITZER: The president said he still plans -- he said make no mistake about it, he still plans to close GITMO, although he's clearly not going to meet that January 21st or January 22nd deadline he called for a year ago. When do you think he'll be able to close the U.S. prison at Guantanamo Bay?

MCDONOUGH: Well, you know, this is a priority of -- of ours for the country, Wolf, because we recognize that so many people have said that Guantanamo Bay detention facility serves as a recruiting tool, frankly, for al Qaeda and that the president indicated in his remarks -- Al Qaeda on the Arabian Peninsula even referenced it when it formed itself over a couple of years ago, as one of the principal recruiting and motivational tools that they had.

So we recognize that it's important to do this. But as the president has made clear throughout, it's important that we do it right. So we're going through each of these individual cases with a fine tooth comb, ensuring that we have exactly the right way to treat them, whether that is to try them in a military commission, in a federal court, whether to transfer them...

BLITZER: Well...

MCDONOUGH: ...in the right conditions and the right circumstances. And as the president and the attorney general discussed and agreed to today, those circumstances are not extant on the ground here in Yemen today...

BLITZER: Well, how much...

MCDONOUGH: ...but we'll keep working that.

BLITZER: How much longer do you anticipate GITMO will remain open?

MCDONOUGH: Well, I'm not going to get into any particular timeline right now. We are working this aggressively every day, reflecting, as we do, the urgency of the threat that it as a recruiting tool poses to us. And so we're going to address it urgently and do it exactly the right way.

BLITZER: And this decision not to send any of those Yemeni detainees who are now at Guantanamo Bay -- there are still about 90 of them -- them there -- back to Yemen, even though you had been planning to do so, that is open-ended, as well?

They're not going back any time soon?

MCDONOUGH: Well, look, Wolf, we have always made clear we're going through these on a case by case basis. We're going to make the determinations on how best to do that, reflecting, obviously, the circumstances on the ground, the best and most recent intelligence about each of these guys and obviously informed by experienced prosecutors who are going through each of these cases in a -- with a fine toothed comb, as I indicated.

So we weren't on the verge of sending a whole host of people anywhere. We're working this through on a case by case basis, and we're going to do that in a way that assures that we close this facility and end the recruiting tool that it provides, but that we do it in the way that advances our interests and enhances our security.

BLITZER: All right. Denis McDonough, the chief of staff at the national security correspondent.

Denis, thanks very much for coming in.

MCDONOUGH: Thanks a lot, Wolf.

I appreciate the opportunity.

BLITZER: And good luck to all of you. Obviously a very sensitive time.

As the president speaks of failures in the airliner bombing plot, should one government agency be stripped of a critical function with that job handed to another agency?

Plus, two very different measures made it through Congress -- now the president and the Democratic leadership must figure out how to combine them into one workable health care reform bill.

(COMMERCIAL BREAK)

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

Happening now, it's the new hotbed of anti-American terror -- we'll talk to a reporter on the ground right now in Yemen about the growing threat there and what the U.S. can do about it. Stand by.

And a very angry President Obama saying the system failed in that attempted Christmas Day airline bombing. We'll get reaction from the Republican Party chairman, Michael Steele. We'll also talk about his new 12-step plan to defeat the president's agenda.

I'm Wolf Blitzer.

You're in THE SITUATION ROOM.

On the sensitive issue of homeland security, with all dangerous threats swirling right now, should one government agency be stripped of a critical job and that job be given to another government agency?

Let's bring in our foreign affairs correspondent, Jill Dougherty.

She's over at the State Department with more on this story.

Jill, you're not at the State Department. You're here in our bureau but you're normally at the State Department. Tell us what's going on.

JILL DOUGHERTY, CNN FOREIGN AFFAIRS CORRESPONDENT: Well Wolf, you know the State Department says when it comes to that attempted airline bombing, it did what it did according to existing procedures, but existing procedures, it admits, still leaves gaps. To fill those gaps, just last week for the first time as the president mentioned, it began including crucial information in cables about suspicious people as to whether or not they have a U.S. visa. The question is, is tweaking the system enough?

(BEGIN VIDEOTAPE)

DOUGHERTY: A United States visa, a coveted document, the key to visiting the U.S. For more than two centuries, it's the State Department that's been responsible for handling official travel documents like this. Yet the alleged Christmas day bomber had an active U.S. visa, and in spite of his father's warnings, it was never canceled. Now, some critics say no more visas for the State Department.

ELLIOT ABRAMS, COUNCIL ON FOREIGN RELATIONS: The function of dealing with diplomacy with foreign government should be in the State Department, but protecting our borders is now a hell of a lot harder than it was in 1789. We have an agency that does that. DHS has customs in it, it has immigration in it, and this is the kind of border protection function it was created to do, and that ought to be lodged at DHS.

DOUGHERTY: DHS, the Department of Homeland Security should be issuing visas this former Bush deputy national security adviser says and revoking them when necessary. That's how the British, Canadians and Australians, among others, handle it, he says. Already U.S. customs and border protection, which is part of DHS, is responsible for keeping terrorists out of the U.S. and for enforcing immigration laws. But the State Department, which issued close to 6 million visas last year, says although it's revising some procedures as a result of the attempted airline bombing issuing visas should be a State Department responsibility.

P.J. CROWLEY, STATE DEPARTMENT SPOKESMAN: Should the extent that members of Congress have surfaced this idea, there could very well be hearings on the subject, we'll welcome the opportunity to discuss this further, but in our view, this remains an idea whose time has not come.

DOUGHERTY: Could having one central agency in charge make more sense? President Bush's homeland security adviser says yes.

FRANCES FRAGOS TOWNSEND, CNN NATIONAL SECURITY CONTRIBUTOR: The fewer agencies you need to touch the security issue, the less opportunity there is for human error.

(END VIDEOTAPE)

DOUGHERTY: Right now the State Department says its studying procedures it can change, including doing more things electronically. Amazingly right now, the department reports that a visa has been revoked by sending a letter. They're looking at doing that electronically. Wolf?

BLITZER: They've got to get up to date on the technology. Thanks very much, Jill Dougherty.

There are government agencies watching out for you, working together to protect the U.S. homeland and American interests. Who is watching them? It's up to Congress to make sure these agencies are doing their jobs, but are Congressional panels really doing their jobs in let's bring in our Congressional correspondent Brianna Keilar who is looking at this story for us.

How many committees are involved in overseeing this issue of security?

BRIANNA KEILAR, CNN CONGRESSIONAL CORRESPONDENT: It's mind- boggling how many there are. When you look at the committees and the subcommittees that are tasked with overseeing national security, there are actually more than 80. Just take a look at the committees that are planning on having hearings or have requested briefings here toward the end of this month. In the Senate you have four. Then in the House you have one that has requested a briefing, the intelligence committee and the homeland security committee that will have a briefing this month. This of course was this many committees, the target of much criticism by the 9/11 Commission, it said that Congress was splintered in its attention to terrorism and there was overlap between committees. For instance, officials would have to give the same briefings or testimony over and over for different committees. I spoke with former Congressman Lee Hamilton the vice chair of the commission. He said not a whole lot has changed here.

BLITZER: The 9/11 Commission said Congress didn't really give itself tools to engage in the proper oversight.

KEILAR: Yes that's right. It did say that. The commission said Congress wasn't providing robust oversight, wasn't really holding feet of the intelligence officials to the fire. Part of the problem, the commission said, was these committees tasked with oversight don't control the funding of intelligence agencies. It's the appropriations committees, not the Intel committee or as it is now the homeland security committee as well that holds the purse strings. Here's what Lee Hamilton said.

(BEGIN VIDEO CLIP)

LEE HAMILTON, VICE CHAIRMAN, 9/11 COMMISSION: The committees, in order to crack down, insist upon, demand performance by the bureaucracy must have money power. They must be able to say you do this or you won't get your money, or the bureaucrats will pay very little attention to them. That's what's happening in the intelligence community.

(END VIDEO CLIP)

KEILAR: One example of this, Hamilton told us, would be for the homeland security committee to insist on having better security scanners system wide and a very tangible consequence that the department's funding would be contingent on this demand.

BLITZER: There's a lot of work to be down and reorganizing, if you will, the Congress itself as far as the recommendations are concerned. Brianna, thank you.

There are disturbing new developments happening right now that have some people wondering if there will soon be another vacancy on the U.S. Supreme Court. Details of what one justice is doing that's fueling the buzz.

And 3D TV, two networks saying they're about to take broadcasting to a new level.

(COMMERCIAL BREAK)

BLITZER: Betty Nguyen is monitoring top stories in THE SITUATION ROOM right now.

Betty, what's going on?

BETTY NGUYEN, CNN CORRESPONDENT: Hey there, Wolf. Could another Supreme Court justice soon step down? Justice Stevens has yet to hire law clerks for the upcoming session, indicating he may retire after 35 years on the bench. Justice Stevens was first appointed to the high court by President Ford back in 1975. This spring he turns 90 years old and is the longest-serving current member of the court. We'll stay on top the story.

An African volcano that erupted on Sunday is still spewing lava. Check out these amazing pictures. Scientists are not sure when it will stop. The volcano located in Congo, about 15 miles south of Goma. It's not flowing toward populated areas or toward the habitat for the rare mountain gorilla, but some other wildlife such as the endangered chimpanzees could be affected.

And get ready for TV to take you into the next dimension. Today both ESPN and Discovery Communications announced they will launch 3-D TV networks. That's right. 3D. Are you ready for it? ESPN says it will start by airing a world cup soccer match in 3D this June while Discovery did not offer a timeline. In order to watch the 3-D programming, you'll have to buy a 3-D HDTV set which most manufacturers are already offering. But no word yet on when you'll be able to enjoy Wolf Blitzer in 3-D. Hey Wolf, I figure if we can do holograms, we can get you in 3-D.

BLITZER: Three-D, who knew? All right. We'll watch it together with you. Everybody get a brand new not only HDTV but a HDTV ready for 3-D. All right. Stand by. We're going to get back to you, Betty, in just a few moments.

A high-level huddle is underway at the White House right now. It's scheduled to get under way in just a few minutes. The president of the United States and the Democratic Congressional leadership as they plot the next move in health care reform. Their task, getting one bill out of the two very different bills that passed the House and Senate. Senior Democrats also met separately earlier in the day on Capitol Hill. Our senior Congressional correspondent Dana Bash is joining us with more on what we know.

It's not necessarily going to be all that easy, as they say, reconciling these two bills.

DANA BASH, CNN SENIOR CONGRESSIONAL CORRESPONDENT: That's right, it won't. This is Democrats negotiating with Democrats, in terms of the House, they actually came back early from recess, Wolf, the leaders, that is, and they met right down the hall in the House speaker's office, and they huddled to try to plot strategy for how to begin to meld those two bills. One of the most controversial differences, of course, is the public option. The house has it, the Senate does not, simply because there weren't enough Democratic votes to pass it.

So I asked the House speaker today, whether or not they concede they are going to have to drop the public option for that reason. She answered by giving a new formulation. She said they would drop the public option if they could guarantee what she called a triple-a rating when it comes to private insurers. She says he wants affordable, accountable and accessibility for people to get health care.

(BEGIN VIDEO CLIP)

REP. NANCY PELOSI (D-CA), SPEAKER OF THE HOUSE: The fact is the public option I prefer to call it the public's option, an option for the public to hold the insurance companies accountable and to increase competition. There are other ways to do that's correct and we look forward to having those discussions as we reconcile the bill. Unless we hold the insurance companies accountable, we will not be able to have the affordable for the middle class, the reforms of the insurance industry that we must have.

(END VIDEO CLIP)

BLITZER: Dana, sorry for interrupting, but I want to get to this question that our White House correspondent Dan Lothian asked the White House press secretary Robert Gibbs earlier in the day, because it directly affects Congress. Listen to this.

(BEGIN VIDEO CLIP)

DAN LOTHIAN, CNN WHITE HOUSE CORRESPONDENT: C-Span television is requesting leaders in Congress to open up the debate to their cameras. I know this is something the president talked about on the campaign trail. Is this something he supports, will be pushing for?

ROBERT GIBBS, WHITE HOUSE PRESS SECRETARY: I've not seen that letter. I know the president's going to begin some discussions later today on health care in order to try to iron out the differences that remain between the House and Senate bill, and try to get something hopefully to his desk quite quickly.

(END VIDEO CLIP)

BLITZER: You remember, Dana, during the campaign, the president said no back-room deals going on, everything will be in front of the those C-Span cameras. Is that likely or unlikely?

BASH: At this point I think it's fair to say it's unlikely and it's very interesting Wolf. The house Democratic leaders were asked about that letter from C-Span's head Brian Lamb asking for televised coverage. They punted pretty much the way Robert Gibbs did over at the White House. They simply insisted there has been transparency in the process, televised committee hears, legislation on is on the website, but Republicans are pouncing on this, saying they want Democrats to honor this request by C-Span, because just as you said, they see a political opening here, because they see this as a perfect way to prove that Washington hasn't changed in the year that since President Obama has been in office, because it was he himself who promised that things would be open and on television. One thing I think was fair to say odd, the speaker Nancy Pelosi was asked about the president's campaign promise, and she responded by just saying, well, there are a number of things he swore on the campaign trail. Wolf?

BLITZER: Dana Bash will be busy over these next few weeks. We'll see if it gets resolved before or after the state of the union address. That's either the last week in January or first week in February. They haven't resolved that yet, have they?

BASH: That's right. It looks like it's heading toward the first week in February, and that is the goal for getting health care done, but Democrats are being very careful not to hold themselves to a firm deadline.

BLITZER: All right. Thanks very much, Dana.

Guantanamo detainees won't be heading to Yemen anytime soon. Why the Obama administration is cutting off those transfers.

Google enters the phone wars big time. Have they come up with what some are calling an iPhone killer?

Stick around. You're in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: Google wants you to forget about the Smartphone. It's unveiling what it's calling a super phone, the Nexus One, designed to go head to head with Apple's iPhone. Our chief business correspondent Ali Velshi is checking it out.

Ali, this new Google phone, is it an iPhone killer as some are suggesting?

ALI VELSHI, CNN CHIEF BUSINESS CORRESPONDENT: Well, Wolf, you know, that's left up to the real gear heads to figure out. In my left hand is an iPhone, this is the new Nexus One from Google. It's made by a company called HTC. They're roughly similar in size. They've got the same sort of idea.

Let me tell you what's different about this new one. First of all, you can buy it without a contract. You can buy it and put whatever service is available for it online. That's a big deal because if you remember iPhone users had to go with AT&T, although it's expensive, it's $529 if you just want to buy it without a contract. If you buy it through T-mobile, which offers the service it costs about the same as an iPhone on a month-to-month base and to buy.

What's interesting about this is it's got a better camera with a flash, which the iPhone doesn't have. iPhone has a 3 megapixel camera, this has a 5 megapixel camera with a flash. It has about 18,000 apps or applications available for it. As you know, Apple is famous for the fact it has more than 100,000 apps. I don't know that it's an iPhone killer. I think what it does is it ups the ante in the smart or super-Smartphone bill. Remember when the iPhone came up people said it was going to destroy Blackberry. Blackberry is doing better than it ever has before, but they're even better phones than they were before the iPhones. So I suspect iPhones will get better, Blackberries will get better, Palms will get better. Microsoft with come out with a platform that's better. So Google has upped the ante and made the super-Smartphone space that much more interesting and probably better for consumers.

BLITZER: But iPhones you can only use with AT&T. The new Google phone you can use with Verizon or any of these other.

VELSHI: If you went to sign up today, you could use it with T- mobile, AT&T, but not the 3G service that you can get on iPhone. Over the next few months though what will happen is all these different carriers will devise a way to work with the Google phone. So if that's important to you, that's an added benefit. Look, it's sleek, it's neat. If you're an iPhone user, you'll be able to make more comparisons. If you use neither of these things, you should know is that more stuff, better capabilities are coming to you at the same price and hopefully in time at a lower price.

BLITZER: And for consumers competition is always good.

VELSHI: Always good.

BLITZER: Ali, thank you.

The latest thwarted anti-American attack has direct ties to Yemen. How severe is that threat? I'll speak with a reporter on the ground there in Yemen. More coming up.

(COMMERCIAL BREAK)

BLITZER: An arctic blast is making its way south that will plunge two-thirds of the country into possibly the deepest freeze of this winter. Our meteorologist Chad Myers is monitoring it all over at the CNN Severe Weather Center.

Is this a remarkably cold January or sort of business as usual?

CHAD MYERS, AMS METEOROLOGIST: It might be a remarkably pricey January, Wolf, because oil prices, and gas prices and natural gas prices and heating your home and if you are in Minnesota and Detroit and I don't even know if your furnace is shutting off with wind-chill factors of 15-20 degrees below zero, but right now it is settled down and the winds are not bad and Minneapolis only feels like zero. Orlando is 41, and the morning low temperatures are going to be much colder than that, probably 26. If oranges get below 28 for four hours or more, they are basically done. At $9.3 billion worth of oranges reside in Florida believe it or not. Right now is the big harvest season and they are getting the oranges off as fast as they can before they can freeze. Tonight is not the coldest night. That will be tomorrow, and they are working as fast as they can to keep those oranges in good shape. Also, strawberries on Friday used to be $13 for an eight-pound flat and today, they traded for $22 for that same eight pounds. So maybe not in the wallet with the heating bill, but maybe in the wallet at the grocery store. So, Wolf, a couple of cold fronts here and it is going to be here tomorrow, and then all of the way down to the Florida keys on Friday, and that cold air gets all of the way to Cuba.

BLITZER: Yes, it is cold, even in Florida and it could affect prices of some produce. All right. Chad, thank you.

With this new wave of freezing weather approaching homeless shelters are scrambling online to help those at risk. Our internet reporter Abbi Tatton is here.

Abbi, what are they doing?

ABBI TATTON, CNN INTERNET REPORTER: Well, I just got off of the phone with a shelter director in Tallahassee who says we are trying to keep people alive right now. That's how serious the situation is for them. That facility is the shelter in Tallahassee. They are in urgent need of sleeping bags down there, but the urgent pleas are coming in from across the south and southeast as the temperatures fall. A lot of the appeals coming in on twitter. If we go to Orlando, Florida, for the coalition of the homeless there, they already had 50 more people, more than usual, last night and have an appeal for blankets and coats and people have been gathering them and the community rallying around, and in northwest Arkansas where it is down to single digits tonight, the Seven Hills Center is opening up an emergency facility in the next couple of hours. They have been appealing for volunteers to man these facilities as they expect 30 or 35 people there. And also going now to the Salvation Army facility in Charlotte, North Carolina, that sleeps 202 women and children, but they have 300 people coming through their doors at the moment, so they have been appealing then, and again, for blankets. Wolf, these are appeals coming in already at capacity, but they know that the temperatures are falling. So, this is really crisis point for some people.

BLITZER: Thousands of people die from hypothermia each year and many of them homeless.

TATTON: They are the most at risk, of course.

BLITZER: This is a huge problem. All right. Thank you, Abbi.

President Obama as we rarely see him visibly angry over failure that nearly lead to a horrendous Christmas day terror attack. We're going to hear from the president himself and take a closer look at what happens next.

And also, your thoughts of what the U.S. should do with Iran. Jack Cafferty with your email right after the break.

(COMMERCIAL BREAK) BLITZER: Right back to Jack for the Cafferty file. Jack?

JACK CAFFERTY, CNN CORRESPONDENT: Well, the question this hour, Wolf, is when it comes to Iran's nuclear ambitions, is supporting the pro democracy protesters in the country a better option than negotiating with the Iranian government?

Brian in Seattle writes: "The Iranian opposition would be put into a more perilous position if the United States were to publicly and directly support them. Memories of the Shah would cause pro government supporters to galvanize like never before, and moderate Iranians would turn sour to the opposition once it appeared that any external power had any sort of direct influence on them. If America is going to deal with the nuclear question with the unrest in Iran, it must do so with a subtle, low-key approach."

Jim in Florida says: "Absolutely it's a better option. Who has more the gain the ruling radically religious Muslim regime or the people who not unlike our own founders seek freedoms not unlike our own? And by our way, while we empower the Iranian people in their effort to achieve freedom, let's let the Israelis forcefully dismantle a few nuclear reactors and research labs. The world would be a safer place."

Will in California writes: "We should support the pro democracy movement, but we need to be careful on how we go about it. It would be too actively involved, then the Iranian government can claim these protesters are just puppets of the U.S. The last thing we want to do is get in a position where our involvement strips this movement of its legitimacy."

Dee Dee writes from Nashville: "Some say we are already supporting the pro Democratic demonstrators. We cannot run ads about it. Let's use some savvy here, we are already helping them, but we have to be discrete about it. We should talk to the Iranian government about it knowing full well we need the Iranian people to overthrow that government."

And Annie writes from Atlanta: "No. Your choices are getting involved in or fueling a bloodbath or reasoning with the theocracy whose figurehead is a little moron with a napoleon complex. What's the third choice?"

If you want to read more on the subject including possible third choices, you can check my blog, CNN.com/CaffertyFile. That Iranian thing is going to become a great story before this year is out.