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THE SITUATION ROOM
A Governor That Does Not Quit; Your Money, Lawmakers' Pet Projects; Bitter GOP Senate Race in Florida
Aired February 22, 2010 - 17:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
WOLF BLITZER, HOST: Rick, thank you.
Happening now, the White House fires an opening shot -- days before a health care stare-down, the Obama administration puts out its plan for the very first time. Republicans are firing back, saying it's the product of back room deals and tricks.
Also, CNN investigates what many of you wonder -- why is the government so broken?
Why can't Republicans and Democrats overwhelmingly agree on a plan to create more jobs, for example?
A crucial vote on jobs -- that's coming up only minutes from now.
And danger, derailments, even death -- are computer systems in your areas riddled with problems like the one that affected of the biggest subway systems in the country?
And who's watching their safety record?
I'm Wolf Blitzer.
You're in THE SITUATION ROOM. All right, mark your calendar. This coming Thursday, you'll see that one-of-a-kind health care stare-down amongst President Obama, Democrats and Republicans. Sparks could fly, as they're already flying today.
Right now, the White House is essentially telling Republicans, here's our plan, where's yours?
Look at this. The Obama administration posted its health care blueprint on WhiteHouse.gov. It's an attempt to compromise between the bills passed in the House and the Senate. The estimate -- almost $1 trillion over 10 years.
One major item -- a proposal for a government board that would help the government block excessive rate hikes by insurance companies across the United States.
Let's bring in our White House correspondent, Dan Lothian.
He's working the story for us -- on this board -- this proposed board, Dan, is it going to have the final say on costs?
DAN LOTHIAN, CNN WHITE HOUSE CORRESPONDENT: They would. You know, this federal agency would have the final stay to decide whether or not these rate increases would go forward, if state regulators decide that they can or they simply won't jump in. And so this board, the Health and Human Services secretary would work with a seven member board. They would be made up of doctors, economists, also, consumer and insurance representatives. And, essentially, they would review these insurance premium hikes and decide whether or not they should go forward.
Ultimately, the White House says, this is
aimed at protecting the consumer.
(BEGIN VIDEO CLIP)
ROBERT GIBBS, WHITE HOUSE PRESS SECRETARY: I saw the statement that -- that Congressman Boehner put out. Again, I think that the product that comes out of Thursday is -- is dependent upon the Republican willingness to come and discuss health care solutions and be open to ideas and ensuring that those ideas are passed onto the people in -- in the form of a change in health care reform.
(END VIDEO CLIP)
LOTHIAN: And what Robert Gibbs was talking about there is going forward to Thursday, this meeting -- this bipartisan meeting where the president will be showing up with his plan and then trying to get ideas from Republicans, as well. So we're asking whether or not the -- the administration is simply trying to say this is it, take it or leave it.
But, in fact, the White House is saying that's not the case, that this is just a starting point, this is the opening bid. The White House wants Republicans to come with their own plan and hopefully they can find some compromise -- Wolf.
BLITZER: TV cameras, as you know, Dan, will be inside Blair House, across the street on Pennsylvania Avenue, from the White House, where the president will convene this extraordinary health care summit on Thursday.
Have they worked out all the logistical arrangements -- who speaks, where they sit, all of that, do you know?
LOTHIAN: If they have, we have not been told that. Simply, we were told today at the briefing by Robert Gibbs that the first part of the sessions on Thursday morning will deal with finances -- how much this is going to cost, how it's going to be paid for, those kinds of issues. But how the rest of the day is going to go, we don't know at this point.
But, simply, the White House is saying, that they do want it to be a session where Republicans show up with some ideas. They don't want it to be just, listen, what you have here -- what you Democrats have doesn't work. They really want it to be a back and forth so they can try to iron out and get help for reform going forward -- Wolf.
BLITZER: We'll have extensive coverage -- live coverage on Thursday of these hours and hours of meetings on health care reform. It's do or die right now.
Dan Lothian, thanks very much.
All right, there's a new development happening up on Capitol Hill involving jobs, issue number one for so many Americans, especially those who are unemployed.
Let's go to our senior Congressional correspondent, Dana Bash.
What's going on -- Dana?
DANA BASH, CNN SENIOR CONGRESSIONAL CORRESPONDENT: Well, Wolf, CNN has learned that the newest Republican senator, Scott Brown of Massachusetts, will vote yes -- will vote yes for the Democrats' job bill -- jobs bill in just about a half hour. Until now, no Republican had publicly said that they would vote yes for what will be a procedural vote for this jobs bill. But I am told by Scott Brown's aide that he will, in fact, vote, yes.
And, in fact, I have a statement from his office and I'll read it to you. Scott Brown says: "I came to Washington to be an independent voice, to put politics aside and do everything in my power to help create jobs for Massachusetts families. The Senate jobs bill is not perfect. I wish the tax cuts were deeper and broader. But I am voting for it because it contains measures that will help put people back to work."
Again, CNN is reporting this for the first time, that the newest Republican, Wolf, effectively breaks ranks with his party and vote for about a $15 billion jobs bill, because, as he says in the statement, he understands this is the biggest issue for people back in Massachusetts -- Wolf.
BLITZER: Well, this -- this is just the procedural vote that's coming up at the bottom of the hour.
So they need 60 votes to break a filibuster and he would be one of those 60, is that what you're saying?
BASH: That's exactly right. This gets the Democrats closer to the 60th vote. For Democrats, it will be still hard. They still -- if every Democrat votes yes, they still are one short because the Democrat, Frank Lautenberg, of New Jersey, is, of course, is in the hospital with -- was diagnosed with cancer. So he will not be here. But so they might be one vote short.
And just big picture, Republicans actually support many of the provisions in this jobs bill. It is -- it does have some tax breaks for small businesses to hire new workers, for example. That was co- sponsored by Republican Orrin Hatch.
But, Wolf, Republicans are upset about the process here. They feel -- many of them feel that they actually were working on a bigger big in a bipartisan way with Democrats and they say that the Democratic leader pulled the rug out from under them and put forward a different kind of bill. And they say that in this procedural vote that we will see, again, in about a half an hour, they will not have the ability to change or amend the bill and they are upset about that.
So we expect most Republicans to vote no. But, again, the Scott Brown statement coming to us is the first indication that a Republican will, in fact, vote yes.
BLITZER: Yes. With -- with his vote now announced, basically, we'll see if it gives some cover to other Republicans to follow suit.
BASH: Could be.
BLITZER: Maybe, Dana.
Thanks very much for that.
Independent Senator Joe Lieberman of Connecticut says he'll introduce legislation next week to repeal the don't ask/don't tell policy that prevents gays from serving openly in the military.
To push -- the push to reverse the 17-year-old policy comes amid shifting attitudes among Americans. A brand new CNN/Opinion Research Corporation poll released today shows that 69 percent of Americans favor allowing homosexuals to serve openly in the military. Twenty- seven percent oppose it. In a similar poll back in 1994, 54 -- 53 percent, excuse me -- favored it. Forty-one percent opposed it.
The chairman of NATO's military committee had this to say about gays serving in the military within the NATO alliance.
(BEGIN VIDEO CLIP)
ADM. GIAMPAOLO DI PAOLO, CHAIRMAN, NATO MILITARY COMMITTEE: I think it's working out quite well. And, in the end, fundamentally, the -- the issue here is -- the sexual orientation is not an issue insofar as you being a soldier or whatever, you -- you will be probably in an environment that you -- you are working for, that is not a problem. Sexual orientation is a personal matter. It's not a matter for -- for the state -- for a state policy.
(END VIDEO CLIP)
BLITZER: And the admiral makes it clear that there have been no problems, as far as he knows, in the NATO alliance. Most of the NATO countries allow gays to serve openly in the military. He doesn't understand why it's such a huge issue here in the United States.
My exclusive interview with Admiral Di Paolo coming up in THE SITUATION ROOM in the next hour. He has a lot to say on this and more. Stand by. Very interesting stuff.
Jack Cafferty and The Cafferty File are coming up.
Also, what are people inside the White House saying about the looming health care stare-down in today's opening shot from the White House?
Wait until you hear what our senior political analysts, Gloria Borger, and David Gergen are learning.
And in our new series, Building up America, we take a closer look at a town where many people are saying, what recession?
(COMMERCIAL BREAK)
BLITZER: Jack Cafferty is here with The Cafferty File -- Jack.
CAFFERTY: President Obama is finally out with his own detailed plan for health care reform. Some have been asking for this for months.
The timing all of a sudden, though, is a little suspect. The president's plan comes four days ago before this televised bipartisan health care extravaganza where Republicans are supposed to bring all their ideas to the table for fixing health care. Yet it sounds like if the Republicans are not on board the president's plan, the president will get the Democrats in Congress to jam through his plan without the approval of the GOP.
The White House communications director says the president expects and believes the American people deserve an up or down vote on health care and if the Republicans are intent on filibustering, the Democrats could use a procedural move called reconciliation, where they only need a simple 51 vote majority in the Senate.
Meanwhile, as part of the president's plan, the federal government would get new authority to regulate the health insurance industry -- almost like a public utility. This comes in the wake of outrage over recent premium increases -- one of up to 39 percent by a health insurance company in California.
The Health and Human Services secretary, along with the state authorities, would be able to deny substantial premium increases, limit them or even demand rebates for consumers.
In the past, oversight of insurance companies has been left up to the states. But the president's proposal calls for a new seven member health insurance rate authority to monitor the industry and come out with an annual report setting the guidelines for reasonable rate increases.
So here's the question -- should the government be able to control how much health insurance companies charge?
Go to my blog at CNN.com/caffertyfile and post a comment.
BLITZER: Jack Cafferty, thank you.
I want to remind our viewers, Jack, also, this Friday night Jack's going to host a special Broken Government -- a one hour, no more politics, it's time for answers. You can join Jack for an hour. You won't want to miss Broken Government, Friday night, 7:00 p.m. Eastern, 4:00 Pacific. Let's bring in our senior political analysts, David Gergen and Gloria Borger, to discuss health care and where we go from here -- David, first to you. The president -- you've been speaking to some of his inner circle.
Is the president really sincere -- serious about trying to get some Republican cooperation right now on -- on health care, because this is -- this is do or die right now?
DAVID GERGEN, CNN SENIOR POLITICAL ANALYST, FORMER PRESIDENTIAL ADVISER: It is. This is a -- this is -- we're down to the final -- the final end game here now, Wolf.
And in talking to people at the White House, I -- I found that there are basically two camps there. There's one camp that feels very strongly that after this Thursday's summit, he should move quickly to -- with this big reconciliation process, a comprehensive health care bill that's so controversial, get Democrats only to vote for it and shove it on through.
There is another group that hopes that from these conversations on Thursday, there will be some Republican proposals that will be put on the table and the president, if he decides to, could go a different way, and that is, to go with a watered down bill that would include some of the Republican proposals, some of his own Democratic proposals and that that bill would then attract bipartisan support and be passed in the next few weeks.
So they haven't quite decided. I think they're going to see what they can get out of this. Clearly, they're opening through this summit -- this is a -- it's an interesting ploy -- but to see if they can't move the needle on public opinion.
BLITZER: Yes. For this bill, it's unlikely they could get the 60 votes to break a filibuster -- Gloria, they may not even be able to get 51 votes on this so-called reconciliation procedure.
What are you hearing, Gloria, from your sources?
GLORIA BORGER, CNN SENIOR POLITICAL ANALYST: Well, I -- I was talking to folks at the White House today who said, look, they had no other choice than to put something out there today. They've been working with Senator Reid's office, Nancy Pelosi's office to try and get some kind of agreement among the Democratic leaders about what they can actually get out of the Democratic side.
They felt very strongly that they needed to go to this summit with something that the Democrats could agree on. And Nancy Pelosi right now has got a big job trying to convince her more liberal House Democratic Caucus to go along with this measures, which is largely a Senate measure.
But the -- the adviser that I spoke with at the White House said this to me today. The source said everybody feels like their back is to the wall now on this, we have no other choice but to get this done. And in the meeting that we're going to cover on Thursday, I'm told the president is going to refer to this as a "starting document" so that he can invite Republicans to join in and change the legislation if they -- if they desire, which they will.
BLITZER: Dave -- David, you're smiling when she says "starting document."
Why are you smiling?
(LAUGHTER)
GERGEN: Well, because it's not a starting document. It's the -- it's -- they're putting it forward as the final -- as -- as the bill itself and you guys can come and make a few amendments. And the Republicans are saying, nonsense, you know, if you're serious about this, let's start over. Scrap that and let's start over and have a real bipartisan...
BORGER: But...
GERGEN: -- debate. And...
BORGER: But at the White House, they felt they could -- they couldn't do that, I mean right, David?
GERGEN: Well, that's right.
BORGER: I mean they...
GERGEN: But that's why this...
BORGER: -- they felt that they couldn't start all over again, given the fact they'd asked Democrats to take all these tough votes over the last nine months.
GERGEN: That's why this -- we're not going to emerge with any sort of grand bipartisan solution coming out of this Thursday.
BORGER: Right.
GERGEN: It may move the ball and change things.
But to go back to Gloria, Wolf, I -- I think the president may have some trouble getting this through the House if he goes to the reconciliation process.
BORGER: Right.
GERGEN: Rounding up the votes in the House is not going to be an easy task.
BLITZER: Yes, because they barely got it passed the last time in the House. They went two or three votes. And they've lost a few Democrats since (ph) then for retirement or illness or whatever death. We'll see what happens. Guys, you'll be part of the coverage on Thursday. We'll watch this historic meeting at Blair House, across the street from the White House. This health care summit will be fascinating.
Millions of vehicles recalled worldwide, a command performance before Congress and now, new trouble for Toyota. And why federal prosecutors are opening a criminal investigation against the carmaker. Stand by.
His popularity is on the down side and one big contender's war chest is five times bigger. But New York's governor says, don't count my out. I'll go one-on-one with the governor, David Paterson. He's here in THE SITUATION ROOM.
(COMMERCIAL BREAK)
BLITZER: Lisa Sylvester is monitoring some of the other top stories from around the world in THE SITUATION ROOM right now.
What's going on -- Lisa?
SYLVESTER: Hi there, Wolf.
Well, U.S. prosecutors opened a criminal investigation of Toyota. Toyota says it's been hit with subpoenas for documents about acceleration and brake recalls. This, as memos come to light showing a Toyota executive bragged about saving millions by limiting a floor mat recall in 2007. Other, quote, "wins" cited by Toyota in a July 2009 memo include getting safety regulations delayed. A month later, a family was killed when a gas pedal stuck under a floor flat.
Toyota has issued this response, quote: "Our first priority is safety and to conclude otherwise is wrong."
Najibullah Zazi has pleaded guilty to a bomb plot aimed at New York's subway system. The Afghan native admitted he conspired in 2008 with others to join the Taliban, but he told the court he was recruited by Al Qaeda instead. He said he was upset by what the U.S. military was doing to civilians in Afghanistan. Sentencing is June -- on June 26, when he faces a maximum of life in prison.
And British Airways cabin crews have voted to strike again. Union members voted overwhelmingly to strike over a dispute involving pay and work conditions, including cutting the number of staff on flights. A strike date hasn't been set yet. In December, a judge blocked a planned strike over Christmas
And it's Florida's answer to its python problem -- wildlife officials are creating a special hunting season to try to stop the spread of the non-native snakes in the Everglades. You see them there. Anyone with a hunting license who pays for a $26 permit can kill the invasive predators from March 8th to April 17th.
And good luck to all of those python hunters.
BLITZER: I don't like those snakes. I never did.
SYLVESTER: I know.
Kind of creepy, isn't it?
BLITZER: All right, Lisa.
Thank you.
Today in our new series, Building Up America, we're taking a closer look at a city where many people are basically saying, what recession?
We're talking about Austin, Texas. It's booming in so many ways. And residents say the business they do -- that they do business -- could be a blueprint for the way your hometown should be doing business.
CNN's Tom Foreman is in Austin, a stop along the CNN Express.
Pretty good publicity for Austin, Texas.
What's going on there -- Tom?
TOM FOREMAN, CNN CORRESPONDENT: Yes. I think they're pretty happy about it, Wolf. But they're happy about a lot of things.
This whole Building Up America series is about finding individuals and businesses and communities that have found a way to thrive despite these difficult times.
And when you ride around here, you see a lot of happy people because they think they have the secret.
Take a look.
(BEGIN VIDEOTAPE)
FOREMAN (voice-over): At Jenny's Little Longhorn Saloon, the crowd is always happy when Dale Watson is on the bandstand.
(MUSIC)
FOREMAN: And they should be. Not only is he a bona fide country music legend who lives here, but, also, their community is building up its economy even while the recession is holding much of the country down.
UNIDENTIFIED FEMALE: I don't feel like we have felt it as much.
FOREMAN: Dale's fans have an idea why.
UNIDENTIFIED MALE: There's a lot of different types of businesses here.
UNIDENTIFIED FEMALE: People support their local businesses, small businesses.
UNIDENTIFIED MALE: Businesses want to come here because it's a tax haven. And that creates a growth during these periods of recession. FOREMAN: With a strong base of steady jobs in government, higher education and the private sector -- this is, after all, home to Dell Computers -- Austin is hanging tough. While nationwide, unemployment is around 10 percent, Austin's is closer to 7. While foreclosures continue to rock many communities, real estate analysts are predicting Austin will be one of the country's strongest markets this year.
UNIDENTIFIED MALE: The number one meat chili was Gold Medal Chili.
FOREMAN: And while in many places, gloom has prevailed, here, in even something as simple as the annual Chili Cook-Off at the Jewish community center, you can find people pulling together in the face of adversity across religious, ethnic and economic lines.
UNIDENTIFIED MALE: There's a thousand reasons to be separate, right, and to separate ourselves into disparate groups. And the great thing about this community is that we're finding all sorts of reasons to be together.
FOREMAN: Back at Jenny's, that's a sentiment Dale Watson shares.
(on camera): It's not that the recession hasn't hit here. It has hit here, but the town has reacted to it differently.
DALE WATSON, MUSICIAN: Yes, I agree with that. Yes. It definitely has hit here, but it -- but -- but we don't feel it as much because I think we support local businesses more here. And -- and that goes from Dell Computers to -- to Joe's Coffee Shop downtown.
FOREMAN (voice-over): Big and small, it's all connected and that's part of what has kept Austin swinging.
(MUSIC)
(END VIDEO TAPE)
FOREMAN: I kept my dancing to a minimum, Wolf, but it really is sort of uplifting to be around here. People are very, very upbeat about the economy. Yes, they've been hit, but they believe they're building their way back up. And it's not just Austin, it's way out into Texas, particularly from here down to San Antonio. We'll be looking into more of that as the week goes on -- Wolf.
BLITZER: Enjoy Texas down there, Tom.
Thank you.
Tom Foreman with the CNN Express.
He became governor by default, now New York's David Paterson wants a term of his own. One problem -- polls show a top contender with a 40 point lead and a lot more money.
Should Paterson run?
I'll ask him. He's here in THE SITUATION ROOM. And tens of thousands of NATO troops fighting side by side with Afghan forces -- what if NATO weren't there?
Could they stand alone, the Afghans?
The alliances top military man has a stunning assessment.
(COMMERCIAL BREAK)
BLITZER: To our viewers, you're in THE SITUATION ROOM.
Happening now, struggling in the polls, New York's governor, David Paterson, talks about his election bid and who he says may be behind an alleged smear campaign and who isn't.
Tensions over Iran's nuclear program reach a new level -- Israel reveals drones that can fly as far as the Persian Gulf.
How does this raise the stakes in this standoff with Iran?
And could Toyota's massive recalls free a man jailed after a fatal accident?
All along, he's claimed a stuck accelerator caused a deadly crash.
I'm Wolf Blitzer.
You're in THE SITUATION ROOM.
He's trailing well back in the opinion polls and his campaign war chest is at a significant disadvantage, but New York's chief executive says, don't count him out yet.
And joining us now, the governor of the great State of New York, my home state, David Paterson.
Thanks very much for coming in, Governor.
GOV. DAVID PATERSON (D), NEW YORK: I was just in Buffalo yesterday, Wolf.
BLITZER: Words to my -- very close to my heart, Buffalo, New York. A lovely place especially this time of the year.
Let's talk a little bit about your political problems right now. I read in "New York Times" this past weekend, you have $3 million in the bank. Andrew Cuomo, the attorney general, has, what, $15 million in the bank? And he's thinking of challenging you for the Democrat nomination? That puts you at a great disadvantage.
PATERSON: Well, I've been at a disadvantage about the last six months, but the last four months until very recently my poll numbers ascended where none of the governors in the top 15 states did, and also since that has occurred, I've raised about $1.5 million in the last month that's not counted there. So I think by the time the election is over, I'll be competitive and I'll also be able to prove to the citizens of New York that service and -- service and also achievement should be factored in.
BLITZER: Do you simply assume Cuomo is going to challenge you for that nomination?
PATERSON: Well, I assume it only because that's the best way to manage your life, is to put as many obstacles in front of you so that you're planning rather than reacting, but I -- we'll leave it to the attorney general to determine what he wants to do.
BLITZER: In the "Times," you wrote he -- I mean, not you wrote, the "Times" wrote he referred to you also denounced what was described as a smear campaign against him. Were you referring to Cuomo smearing you? Is that what you were suggesting?
PATERSON: Not at all. Not at all. I have no information that the attorney general did that. And if there was even a suggestion that he did without proof, then he would become the victim of the same thing I became, which is a bunch of rumors that are fallacious and illegitimate.
BLITZER: All right. Let's talk a little about these poll numbers, this Marist poll, February 3rd, a few weeks ago, how do you rate Governor Paterson's job in office? Twenty-six percent said excellent or good, 70 percent said fair and poor.
Those are pretty tough numbers.
PATERSON: Well, when fair and poor are put in the same category, I don't really know what the poll means. What I will say is, there's no doubt that incumbent governors are having a tough time, regardless of what region they represent or what party affiliation they have.
But what I think is misleading is the polls are antiseptic. You're not hearing what the challengers think. And rather than talking about poll numbers, or telling all the special interests what they want to hear, but not telling the people of the state of New York what you're going to do about these problems, or even these other candidates around the country are doing the same thing.
When they have to get in the fire, where I am, then we'll see how effective they are.
BLITZER: Because another poll that's just out today, the Sienna College poll, choice for governor if election were held today, David Paterson 39 percent, Rick Lazio, the former Republican congressman from Long Island, 46 percent.
He would beat you according to the Sienna College Poll. And in the same poll, if Cuomo were the Democratic nominee, he would get 63 percent to only 26 percent for Lazio. How do you interpret that? Because that's not very encouraging.
PATERSON: It's speculative. It is a moment in time long away from a campaign where a governor, who -- the only communication I've had with the public $40 billion of deficit reduction when we pass our budget -- assuming we pass it in April of this year.
When you have had to cut education and health care, when you have had to close the parks in the summer or delay income tax returns, when you've had to even propose that we increase fees for license plates a year before we normally would, because we have no money and we can't spend money that we don't have, you're going to be vastly unpopular, but it's kind of like the big decision makers in governments and just like big decision makers in families.
When they say no, everyone's upset, but upon further review, you start to see that they made the right choice and the tough choice.
BLITZER: You were over at the White House with other governors today. You've seen all those reports that top officials at the White House don't like you to run again, they think you would be a drag on the ticket if you were atop the ticket.
Did you discuss this with anyone over there? Did you have any conversation with them?
PATERSON: No, top officials at the White House spoke to me about six months ago about a different scenario, one that never came to pass. And we did have that discussion, and frankly I think the White House was right to have that discussion, because losing a state like New York for the Democratic Party would not be a good thing.
But ever since an article in the "New York Times" that quoted two White House sources as saying that a congressman sent me a message that he didn't send, so it was an inaccurate article, the White House has been very gracious to me and I think very supportive of New York state.
BLITZER: Do you feel disappointed that some of your fellow elected politicians, Democrats in New York, did not come out to Long Island when you announced you're seeking reelection over the weekend, like Kirsten Gillibrand, the said junior senior whom you named to that spot.
PATERSON: Well, Kirsten Gillibrand has endorsed me. She couldn't come to the actual event. And a number of others have as well, but the point is that right now we are -- most of the elected officials are unfamiliar with an incumbent governor who has been fighting the economic situation as I have been being challenged at all.
They don't understand why that's happening. So they're not really picking any side, hoping that this gets worked out sometime soon.
BLITZER: Let's talk about this decision -- apparent decision to not have the trial of Khalid Sheikh Mohammed in New York City, although it potentially could still be in New York state.
You're the governor. Do you want this so-called mastermind of 9/11 tried in the same state where these crimes were committed, the destruction of the World Trade Center? PATERSON: The first day I heard the announcement, I said that I would abide by any decision that the federal government made. However, if it was up to me, at ground zero, where people lived and worked there for years after the country was attacked on September 11th, with our Environmental Protection Agency under a different administration telling them that it was safe to work there when there was evidence that it wasn't, many people got sick, many people died subsequent to the actual attack, gridlock for two years, people in stark terror every time they hear a loud noise, no, I didn't think it was fair to that part of the country that took the hit.
BLITZER: What about in upstate New York? Moving it to West Point or Newberg, New York or some other community?
PATERSON: I think that would be more appropriate. We don't mind having it in the southern district, which is in the New York catchment area, the court of jurisdiction. We just think that a better venue for the people who have suffered in that part of New York City would be more appropriate.
BLITZER: Governor Paterson, good to have you here in THE SITUATION ROOM. Thanks very much for coming in.
PATERSON: Thank you, Wolf. Good to be here.
BLITZER: Good luck.
PATERSON: Thank you.
BLITZER: Some people liken it to bringing home the bacon. They're called earmarks, lawmakers securing money for special projects in their states and in their districts.
CNN has opened a special earmark desk. We're checking in with Ali Velshi on the earmark desk.
And it's the warm embrace some hope will be a kiss of political death. President Obama and Florida governor Charlie Crist. Crist's chief political antagonist is hammering him for accepting stimulus money, but wait until you hear Governor Crist is now defending.
(COMMERCIAL BREAK)
BLITZER: At part of CNN's "Broken Government" coverage all this week, our chief business correspondent Ali Velshi is manning what we call our earmark desk. We're looking into how Congress funnels your taxpayer money on to local projects and programs across the country.
Ali is joining us now.
Explain the definition, Ali, of a congressional earmark because a lot of people think it's pork barrel spending.
ALI VELSHI, CNN SENIOR BUSINESS CORRESPONDENT: Right.
BLITZER: But tell us what it entails. VELSHI: It is not necessarily pork spending. Let me just tell you, the official definition from the Office of Management and Budget is it's funds for projects, programs or grants that circumvent otherwise applicable merit-based or competitive allocation processes or specifies the location or recipient of -- or otherwise curtails the ability of the executive branch to manage the responsibilities pertaining to the funds allocation process.
Here's key parts. The location or recipient. So members of Congress put this earmarks in that directs money to a particular place. Now the bottom line is, let me tell you how much we're talking about here. $15.9 billion in fiscal year 2010. The federal budget almost $4 trillion.
So as a percentage, it's not that much, but there are 9,500 individual earmarks in this last year. And by the way, they don't go into the budget, so in an environment where you're talking about disciplined spending, I mean, $15.9 billion isn't a lot in the whole case of how much the government spends, but tell that to somebody who's lost their job, you know, making $50,000 -- Wolf.
BLITZER: Yet there are some lawmakers, as you know in the House and the Senate, who don't do earmarks as a matter of principle, but there are plenty of others who do earmarks, and they make this case, Ali, as you know.
They say you know what? It's better that Congress decides specifically where the money should go than letting some anonymous bureaucrat, the Department of Commerce --
VELSHI: Right.
BLITZER: -- or the Department of Agriculture, decide where that money go.
VELSHI: Which is right. Because when it goes into the budget process, it is not dealt with then by elected politicians. It's dealt with by bureaucrats. In today's environment, some people might think that's a better thing, others want their elected politicians directing this.
There are six members of the Senate -- seven members of the Senate who, as a rule, do not include earmarks -- John McCain, Evan Bayh, who's announced he's not running again, Claire McCaskill, Mike Johanns, Tom Coburn, Jim DeMint, and Russ Feingold.
Six people in the Senate. There are a lot more in Congress but still not making up 10 percent of the population. Thirty-five members of Congress, Wolf, as a habit do not put earmarks in, but the system is built, Wolf, and you know this, to be very difficult, that if you do not put these earmarks in, you forgo bringing money to your district and you could pay a political price for that later -- Wolf.
BLITZER: Yes. And you leave all the decisions up to the executive branch.
VELSHI: Right.
BLITZER: And the legislative branch says, you know, not so fast. We have a say in how this money is spent as well.
We're going to continue to watch this with you all week, Ali. Thanks very much, Ali Velshi on the earmark desk for us.
VELSHI: My pleasure.
BLITZER: Truthfully speaking, do Americans honestly think that many politicians are essentially liars? Wait until you see the results in our brand-new poll.
And amid fears of a possible war between Iran and Israel, Israel shows off what could be -- could be a deterrent.
(COMMERCIAL BREAK)
BLITZER: Lisa Sylvester is monitoring some of the other top stories in THE SITUATION ROOM right now.
What else is going on, Lisa?
LISA SYLVESTER, CNN CORRESPONDENT: Hi there, Wolf.
Well, the Supreme Court has decided to hear the appeal of a couple cleared of abusing their teenage daughter, but still on California's list of suspected child abusers. This despite obtaining court judgments that they were factually innocent. The court will consider whether the database violates the constitutional protection of due process because on the list aren't given a fair chance to challenge their inclusion.
Young Palestinians clash with Israeli soldiers over a last-minute decision to add two West Bank tombs to Israel's list of national heritage sites. One of the sites in Hebron has long been a flashpoint. It's where the biblical figure Abraham is believed to be buried and is sacred to both Muslims and Jews. The other site is in Bethlehem. It was the most serious violence there in months.
And we have some dramatic video. Take a look at this. It was captured by a camera crew riding along with Chinese cops. You can see the car there swerving, and then it crashes into a barricade. The suspected drunk driver left a mess of debris in the road. And he was eventually found asleep but unharmed inside his car.
China recently launched a crackdown on drunk driving because of a sharp rise in crashes and fatalities. Wolf?
BLITZER: They got car chases in China, too. I guess.
SYLVESTER: Apparently so.
BLITZER: They're moving up in the world there. The modernization of China. Thanks very much for that. A man in prison for a deadly high-speed car crash four years ago wants his case reopened. Attorneys say the Toyota he was driving may have been the subject of an accelerator recall.
(COMMERCIAL BREAK)
BLITZER: Let's go right back to Jack for "The Cafferty File." Jack?
JACK CAFFERTY, CNN ANCHOR: The question is, should the government be able to control how much health insurance companies charge?
Virginia says, "It's a must to regulate how much they have charge. I've seen my premiums soar, over $200 a month in the last six years. A premium now of $800 a month leaves me with about $300 a month from my teacher retirement check. It seems I taught 23 years for health insurance. Check their profits, it's criminal what they charge."
Donna writes from Maryann, Illinois, "The government already has too much control. If Obama has his way, the government will control every aspect of our lives. We're heading more and more toward a socialistic society. Enough. Keep the government out of private business."
Heather writes, "Yes, and the reason is no one else will. I'm sick of paying $164 a week for a plan that has a $7,500 deductible and $500 out-of-pocket expense and doesn't pay for annual physicals or pap smears, et cetera. I personally paid for all my preventative care last year even though I have a health insurance plan through my husband's employer. My husband's company has just notified us of a 23 percent increase in premiums. For what? Crappy coverage."
Tony writes, "Does the government control how much other merchandise or services cost? Should they control house or apartment prices? Why should any companies be subjected to big government control? Competition in a free market place is what drives prices down. As a great former president once said, government is the problem, not the solution."
Thomas writes, "Hell yes, it ought to be controlled and it ought to be treated like a utility. It's something necessary like running water and electricity."
Sterling writes from Aspen, Colorado, "The proposed health care reform bill is a bailout for the private health insurance industry. We've got to allow them to charge enough to pay their lobbyists to usher this can of worms through the Congress."
And Pete writes from North Carolina, "Absolutely. My Medicare advantage premiums went up this year 408 percent. That is not a misprint."
If you want to read more on this you can go to my blog, CNN.com/caffertyfile.
BLITZER: Jack Cafferty, thank you.
Some saw it as simply a warm embrace. Others hope it will be a kiss of political death. Political agreement between President Obama and the Florida governor Charlie Crist. Right now Crist is defending his decision to take the stimulus money. Could that give his chief opponent even more ammunition?
And Israel shows off what could be a deterrent amid fears of a possible war with Iran.
(COMMERCIAL BREAK)
BLITZER: Let's get to our "Strategy Session" right now. Joining us now two strategists. Our CNN political contributor, the Democratic strategist Donna Brazile, and former U.S. senator, Norm Coleman. He's the CEO now of the American Action Network which was officially launched today at the National Press Club here in Washington.
The group has said its mission is to promote center-right principles among policymakers and voters.
Senator, welcome to THE SITUATION ROOM.
NORM COLEMAN (R), FORMER U.S. SENATOR, CEO, AMERICAN ACTION NETWORK: Good to be here.
BLITZER: Good luck with the initiative.
COLEMAN: Thank you very, very much.
BLITZER: Let's talk a little bit about Charlie Crist. He's in a political fight for his life. He wants to be the next senator from Florida. He's got a challenge for the Republican nomination from Marco Rubio.
And one of the issues is his support, he embraced President Obama and he accepted the stimulus package, thought it would be good for Florida. Now he's saying, you know what, I still think it was good for Florida. It was the right thing to do, he says, our economy was going into the abyss and if we didn't have those moneys we would have had 87,000 people out of work today in the sunshine state.
Does he have a point, Governor Crist?
COLEMAN: It was a bad vote. And he as a governor probably had to embrace it, but if you could have embraced it by saying, you know, I know that the money is not going to be stimulus, it's not going to be spent the way it should be spent, that the tax cuts are really they're disguised spending.
That there's so much money going in so quickly there's going to be waste and abuse, but we need this money. And instead his problem was he embraced it and embraced it whole-heartedly, and embraced the president and you know today is paying the price.
The good news is that the election isn't until August.
BLITZER: For him.
(CROSSTALK)
COLEMAN: He's got some time, but that was not a good vote.
BLITZER: Do you think that he's in trouble with Marco Rubio challenging? Marco Rubio is a little known state legislator and all of a sudden this is a tough fight.
DONNA BRAZILE, DEMOCRATIC STRATEGIST: Well, I have a candidate in this fight and that's Mr. Meeks. Mr. Kendrick Meeks, but --
BLITZER: He's the Democrat.
BRAZILE: He's the Democrat. But --
BLITZER: But first, Charlie Crist has got to beat the Republican for the nomination.
BRAZILE: But I agree with Governor Crist who said that, you know, he has no regrets for taking federal money that helped him close the budget gap, that saved 87,000 jobs, that insured that K-12 education was not cut, Medicare, Medicaid.
This was a very important step for the governor. And I agree, along with some other Republican governors who've come out publicly and say this money was very helpful.
BLITZER: Like Governor Schwarzenegger of California, who's a Republican, he said, you know what, they need the money, they need the jobs. These states, as you know, Senator, they're in deep trouble right now.
COLEMAN: Governor Schwarzenegger is not going to -- his endorsement is not going to earn a lot of votes for Charlie Crist in the Republican primary. I don't think it's a toxic vote.
Listen, the good news for my team, Wolf, is that both Crist and Rubio are far ahead of Meeks in this race. So we think we're going to keep that seat. The governor has until August. It's easy to be on the outside. Easy to criticize. I took a vote on a bailout right before the election that was a killer vote. The vote had to be taken.
So I understand --
BLITZER: When you supported President Bush's bailout plan.
COLEMAN: Absolutely. When we're told the economy was going to collapse, it's going to melt, then, you know, lose an election, do the right thing. That was the right vote to take. His problem, I think, is the way he embraced the vote. He could have identified some of the failings. Again, he's got until August. The race is not over yet.
BLITZER: We'll see what happens in Florida.
Look at this CNN Opinion Research Corporation Poll, Donna. Are federal government officials honest? Twenty-two percent say yes, 75 percent say no. Now that's been fairly consistent over about 15 years but it's sort of depressing when you hear that 75 percent of the American public feel that American -- that federal government officials are not necessarily honest.
BRAZILE: You know, if you just, you know, switched in lawyers or, say, another group of people --
BLITZER: Journalists.
(LAUGHTER)
BRAZILE: Pundits. College professors -- no, I'm joking. But look, the truth is, Wolf, we are living in a very tough period of time when the American people are just feeling right now a lot of anxiety, a lot of concern. And they are quite honestly frustrated with public officials.
That's why I think the polls reflect that right now politicians are not regarded in a favorable light, but I got to say something. Public servants are truly respectable. They are great people, great human beings. Every now people fall by the wayside. But we shouldn't paint all the politicians with a broad brush.
BLITZER: Yes.
BRAZILE: Look, I'm standing next to somebody who probably betted for the Minnesota Vikings.
(LAUGHTER)
BRAZILE: Who dat?
COLEMAN: Absolutely. The bet, it seems, I lost that game.
Wolf, on Thursday afternoons we get together for lunch with these my former colleagues. If the cameras were there, you'd see us folks get (INAUDIBLE) about what's on their mind. They're not talking about ripping the public off. They're not talking about loading up their own pockets.
They're talking about the tough challenges we have and what do we do to fix them, what do we do to solve it. Cynicism is -- it's an epidemic, it's a virus, it's -- I think it eats away at the body politic. And it's unfortunate.
The president could have helped us out by putting the negotiations on C-SPAN. Politicians could do a better job not getting themselves in trouble. But this anger that's out there and the cynicism really is toxic. It doesn't help.
BLITZER: Thursday the negotiations are not just going to be on C- SPAN. They're going to be on CNN as well. We're going to show the whole world what's going on this health care summit at Blair House on Thursday.
Guys, thanks very much for coming in. Good luck with life after the U.S. Senate, Senator. COLEMAN: There is life.
BLITZER: I can see.
COLEMAN: When you wake up every morning, Wolf, and you're not wondering who's trying to kill you today.
(LAUGHTER)
COLEMAN: There is life.
(CROSSTALK)
BLITZER: That's encouraging. Senator, thank you.
