Return to Transcripts main page

THE SITUATION ROOM

Israeli P.M. Meets with President Obama; Nancy Pelosi Unbound; Salary Cuts Ordered for Top Executives; Health Care Reform By November

Aired March 23, 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: Thank you, Rick.

Happening now, Democrats can barely contain their enthusiasm now that health care reform is the law of the land.

Are they now in a better position for November elections or are they more vulnerable?

Republicans already are fighting the next battle against health care reform and there's new hope that they may have some success in the Senate -- hope for them this hour.

Will the Democrats' carefully written package of fixes get fouled up?

And a remarkable break in a three decades old murder case -- police now reveal how they found and arrested two suspects accused of killing a group of teenagers back in 1978.

I'm Wolf Blitzer.

You're in THE SITUATION ROOM.

It's the most important piece of legislation President Obama has signed by far and the most sweeping change to America's health care system in decades.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: Today, after almost a century of trying; today, after over a year of debate; today, after all the votes have been tallied; health insurance reform becomes law in the United States of America.

(END VIDEO CLIP)

BLITZER: That's not all that happened today with the stroke of the president's pen -- well, actually, he used 22 pens -- now that the reform bill is the law. The battle is officially underway in the Senate over the Democrats' fixes to the legislation, as they're called. And attorneys general from 14 states have filed lawsuits against the federal government, claiming the health care overhaul is unconstitutional. Let's begin our coverage this hour with our White House correspondent, Ed Henry -- a huge day, Ed, for the president. They're savoring this moment.

ED HENRY, CNN SENIOR WHITE HOUSE CORRESPONDENT: They really are.

But you know what, Wolf, they are already focusing on what's next. They realize that they can't just bask in this victory here. They've got to really turn it around quickly.

And you may have thought that the road show was over -- all of the salesmanship that the president did over the last 14 months. But instead, well, White House officials say this president is almost immediately going back on the road. He wants to try to sell some of the political benefits for Democratic members of Congress who passed some of those tough votes by touting what he believes are the substantive benefits for the American people within the first six months.

There's going to be some things that will kick in over years, but some things kicking in within six months. He's going to go on the road to talk about it.

The first stop is Thursday, in fact. He's going to Iowa City. The significance there is that was the site of where he gave his first big, substantive health care reform speech back in 2007 as a candidate. So he will focus on substance and sort of bookend all this. But, also, politically, obviously, Iowa, was where he really broke through and won that caucus there. That was his first major victory and really put him on the map. Obviously, the rest is history.

But he realizes these Democratic members of Congress, they need some cover. The president is going to go out there and provide it -- Wolf.

BLITZER: The sales pitch will be what?

HENRY: Well, we heard it a little bit today. He gave a preview in the signing ceremony. He started saying, look, a lot of things will kick in over years because we want to get it right, but others will kick in quickly.

Let me run through some of those so our viewers know exactly what they can take advantage of.

Small business tax credits -- something David Axelrod spoke about in THE SITUATION ROOM yesterday. The -- basically, the government is going to cover 35 percent of premiums for small businesses within six months.

Free preventive care under Medicare -- the president made a big deal about that today, about getting ahead of it before people get diabetes and other things.

Also, help for early retirees, trying to help them. And, also, immediate access for people who don't have insurance right now. It's going to take some time to get this insurance exchange up and run. So in the short-term, there's going to be a high risk pool for those who do not have insurance right now to try to get those 32 million people covered as quickly as possible.

This White House believes, as the president said Saturday in his final pitch to House Democrats, that good policy is good politics. He's going out there to sell it -- Wolf.

BLITZER: The vice president was very excited, very enthusiastic. And after he introduced the president, there was a little moment where he used the -- the F word.

Listen to this.

(BEGIN VIDEO CLIP)

JOSEPH BIDEN, VICE PRESIDENT OF THE UNITED STATES: Ladies and gentlemen, the president of the United States of America, Barack Obama.

(APPLAUSE)

BIDEN: This is a big (EXPLETIVE LANGUAGE OMITTED) deal.

OBAMA: Thank you.

Thank you, everybody.

(END VIDEO CLIP)

BIDEN: We had to beep out that word, which we don't use here on television.

And what are saying at the White House about that?

HENRY: Interesting. You know, the bottom line is Robert Gibbs decided to respond on Twitter, because we were all calling and e- mailing people were trying to figure it out, you know, what are they going to say, how do they defuse this controversy?

And very quickly, he basically put out a Tweet that said, by the way, Mr. President, you're right.

So they're saying, look, this is a big deal. Maybe he shouldn't have added that extra adjective, if you will. But bottom line is, they think it is a big deal. They're glad the vice president is touting it. And they think that may defuse it. This is certainly not the first time the vice president's had an unscripted moment.

But I think in the East Room on such a historic day, this one is going to go in the unscripted Hall of Fame -- Wolf.

BLITZER: Ed Henry, standing by.

The president's often used a number of pens to sign historic legislation so they can give the pens away as mementos.

But who got the 22 pens that the president used today?

Most are members of his administration and Congress, including the vice president, Joe Biden; the House speaker, Nancy Pelosi; and the senator majority leader, Harry Reid.

One notable exception, Senator Ted Kennedy's widow, Vicki, got a pen in honor of her husband's lifelong work for health care reform. And she was there in the East Room for this signing ceremony today.

Now to a major legal challenge of the health care reform law and whether it's Constitutional. Lawsuits were filed today in more than a dozen states.

Brian Todd is here.

He's taking a closer look at these lawsuits -- explain to our viewers, Brian, what's going on.

BRIAN TODD, CNN CORRESPONDENT: Wolf, the ink was hardly dry from the president's signing today when officials from 14 states went to court to try to block this health care overhaul. Thirt -- thirteen of them all joined one lawsuit. Of those 13, 12 are Republicans who are attorney generals of those states. And one state, Louisiana, the attorney general, Buddy Caldwell, is a Democrat.

Now, Virginia's attorney general, who is also a Republican, filed a separate lawsuit today against the federal government. He did that a little bit afterward those -- from those 13. He did that this afternoon. Now those 13 which joined together to sue the government have a central contention in this. Here is a phrase from their complaint: "The Constitution nowhere authorizes the United States to mandate, either directly or under threat of penalty, that all citizens and legal residents have qualifying health care coverage."

So, essentially, they argue that this health care law is unconstitutional, violating the Tenth Amendment to the Constitution, which says powers not delegated to the federal government are reserved to the states -- Wolf.

BLITZER: That argument is already being debated publicly in a lot of places.

TODD: It certainly is. And it has been for a few days before -- even before the vote happened on Sunday.

Let's first hear from a man leading the charge among those 13 states, joining the one lawsuit. He is Florida's Republican attorney general, Bill McCollum.

He came out today and blasted this legislation.

(BEGIN VIDEO CLIP, COURTESY CAPITOL NEWS)

BILL MCCOLLUM, FLORIDA ATTORNEY GENERAL: It manipulates the states. It forces the states to do things when our money is at stake and we are not allowed to have any say over how it's done in the sense of the broad world that's out there the way we'd like to do it. It is a the wrong law. It's unconstitutional. And this lawsuit will prevail, ultimately, in overturning it.

(END VIDEO CLIP)

TODD: Not everyone agrees. White House Press Secretary Robert Gibbs says the administration's lawyers have advised them that they'll win these lawsuits. Legal scholars we spoke to say that the states, the vast majority of the time, cannot trump federal law. They say that's been proven repeatedly in the Supreme Court. They say the Constitution does give Congress broad power to regulate commerce and promote the general welfare of Americans.

These states will be up against it to win those suits, but they'll get some political mileage out of it -- Wolf.

BLITZER: All right. We'll see how far that goes. At least in one of those states, there's already a huge political uproar.

TODD: There certainly is. In Washington State, one of the plaintiffs is the law -- in this lawsuit is the attorney general from Washington. The governor there, Christine Gregoire, is a Democrat. She has criticized her own attorney general, Republican Rob McKenna, for joining this case. McKenna, as we mentioned, is of a different party. So Gregoire says they're going to actively fight this lawsuit -- she will actively fight this lawsuit. So maybe some unpleasant meetings between her and her attorney general.

BLITZER: All right. So the lawyers will be busy for a while...

TODD: That's right.

BLITZER: -- with these arguments.

Thanks very much, Brian.

Right now, Republicans are regrouping for the rematch over health care reform in the Senate.

Do they have a shot at derailing the Democrats and their reform fix-it plan?

I'll ask the number two Republican in the Senate, Senator Jon Kyl.

And the House speaker, Nancy Pelosi, is all fired up over the new health care law. She's refusing to let Republicans demonize her.

Our Gloria Borger is just back from a special briefing with the speaker.

Stay with us.

You're in THE SITUATION ROOM. (COMMERCIAL BREAK)

BLITZER: Jack Cafferty is here.

with The Cafferty File -- Jack.

CAFFERTY: The health care debate represents the most crushing defeat for the Republican Party in four decades. That assessment comes from a Republican.

Former Bush speechwriter David Frum says the GOP may be overly optimistic about chances of winning seats in the mid-term election in November and that the party has only itself to blame for what has happened.

Not all Republicans feel the same way. Some think they have not miscalculated. They're prepared to campaign on a pledge to try to repeal health care reform. Their mission now will be to prove to voters that the bill is a bad idea and that it will cost them -- the voters.

But that won't necessarily be easy. The Democrats were smart. Their timing is good -- very good. Consider this -- some of the benefits of this health care reform bill go into effect only weeks before the midterm elections -- a lot of them being the most popular and least costly to implement.

Also, voters must be left with a bad taste in their mouths from the way some Republicans behaved at the end of this debate, including shouting insults in the House chamber, encouraging outbursts from the galleries, etc.

Of course, there's hope for the Republicans. They were very effective last summer, you'll recall, controlling the message with Tea Parties and town hall meetings. And polls show that Republicans are among some of the most motivated voters going into the midterms.

But it's definitely time, most experts think, for the GOP to step up and prove that they are more than what the Democrats have successfully tagged them as being -- the party of no.

Here's the question -- where do Republicans go from here?

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

BLITZER: Jack Cafferty, thanks very much.

Let's bring in Senator Jon Kyl, the Republican senator from Arizona, to ask him that question, where do the Republicans go from here?

This is now the law of the land -- health care reform -- Senator Kyl.

What are you going to do about it? SEN. JON KYL (R), ARIZONA: Well, first of all, as of today, by 59-39, the American people oppose this legislation. Only 19 percent believe that they will be better off...

BLITZER: Well, let...

KYL: -- everyone else thinks that...

BLITZER: Let me -- let...

KYL: Let me just finish my point.

BLITZER: Let me...

KYL: -- 19 percent say that they will be better off. Everyone else says they'll be worse off or not any better off, in any event...

BLITZER: All right, well let...

KYL: And I think what...

BLITZER: Let me interrupt you at that...

KYL: -- we will do...

BLITZER: -- at that point. Excuse me for interrupting you, because these poll numbers are very important in getting a sense of what's going on.

You were referring to a CNN/Opinion Research Corporation poll, which had that 59 percent number. But of that, about 12 or 13 percent, they didn't like it because it was not liberal enough -- it didn't have a public option, it didn't have a -- a single payer. So it wasn't just because they thought it was going too far on the part of the government.

Let -- let me bring to your -- your attention, if you haven't seen this new Gallup Poll that was just put out today by Gallup USA reacting to the passing. This was a poll that was done since the signing -- since the passage Sunday night. Our poll was done before.

The reaction to the passing of health care reform, those who said they were either enthusiastic about it or pleased were 50 percent; disappointed or angry, 42 percent.

So this new Gallup Poll that was done since it passed the House says that more Americans like it than dislike it.

KYL: Yes. A, I don't believe that. I think all of the polls that, in the last few days, have sought to get American public opinion show that it is very fixed against the legislation. I don't doubt that there is a bump when the president has a signing ceremony and, you know, he's out there with the only coverage of his conversation showing some -- some bump in the polls.

But as I started to answer your first question, I -- my point was this. I believe that those numbers will hold between now and the end of the year because the American people will have an opportunity to see things that we have been talking about coming true.

Will their insurance premiums go down or will they go up?

They're certainly not going to go down.

Will they see their taxes go down?

No, their taxes are going to go up.

Well, what about the budget deficit?

Well, the budget deficit is going to go up.

And what about more government involvement in health care...

BLITZER: All right...

KYL: -- both health care and now student loans -- the government is going to take over student loans as a part of the health care bill...

BLITZER: So the...

KYL: -- partially so that the student loan program, now run by the federal government, will help to fund health care.

BLITZER: I think on all those points, the Democrats would disagree with you on that. Certainly, the president will.

But practically speaking, can you do anything to stop this from going forward?

KYL: The president signed the bill this morning.

BLITZER: So it's the law of the land?

KYL: Yes.

BLITZER: What are you going to -- what are you going to do as far as the reconciliation bill, the separate bill, the "fixes," as they're called, that's now before the Senate.

KYL: That -- that bill plays out over the next, roughly, three days. Republicans will offer amendments to it. I'm assuming Democrats will vote in lockstep. They've always opposed our ideas. They'll probably continue to oppose our ideas. If they should adopt some of our amendments, that would be wonderful. But they haven't done so so far.

It will at least be an opportunity for us to remind the American people of what we have been for and what we remain for. Eventually, we hope that the bill will be repealed and replaced with other solutions to the problems that we all agree exist. But... BLITZER: So if I what I hear you saying, practically speaking, with 41 Republicans in the Senate, there's no way you're effectively going to be able to stop the 50 -- 59 Democrats from passing this?

They only need 51 votes.

KYL: Right. And, you know, unless Democrats suddenly decide to accept some Republican ideas, chances are the bill is not going to be amended. Now, there could be points of order that lie against the bill. If so, we will sustain those and then the House would have to vote for the bill again. But I'm assuming that this bill eventually goes to the president, maybe in roughly a week or so.

BLITZER: All right. Before I let you go, a very quick question on Arizona politics. Your colleague, Senator John McCain, how much of a challenge does he really face from J.D. Hayworth, who's challenging him for the Republican nomination?

They have a primary battle underway.

Is this a serious challenge, not so serious?

How worried should McCain be?

KYL: Well, John is taking it seriously, I can tell you that. It -- he's taken every challenge seriously. He's working very, very hard. And I'm sure because of that and because the voters of Arizona have elected him many, many times, that he'll be returned to the United States Senate next year.

BLITZER: And you're -- you're with Senator McCain on this one?

KYL: Yes, I am.

BLITZER: OK.

Senator Kyl, always good to have you here in THE SITUATION ROOM.

Thank you very much.

Happening now, President Obama also meeting with the Israeli prime minister, Benjamin Netanyahu, over at the White House. This at a time of relatively high tension between the two countries.

Our senior political analyst, David Gergen, is standing by with some insight.

And if you've ever given or received a gift card, there are now new government rules you need to know about. We have the details for you.

(COMMERCIAL BREAK)

BLITZER: Lisa Sylvester is monitoring some of the other top stories in THE SITUATION ROOM right now -- Lisa, what do you have?

SYLVESTER: Hi there, Wolf.

Well, a Pittsburgh emergency worker is facing termination and three others suspension in connection with the death of a man who died waiting 30 hours for an ambulance during a massive snowstorm. The public safety director says emergency personnel showed a lack of compassion last month in dealing with Curtis Mitchell, who placed 10 calls seeking help for abdominal pain. The paramedics union says it will fight action taken against two of its members.

Afghans are now the largest population seeking refuge, according to a new report. The U.N. Refugee Agency says the number of Afghan applications for asylum was up almost 50 percent last year from the year before. The agency cites continuing violence in the region for the spike in numbers. No word yet on the number of applications that have actually been granted.

And maybe this has happened to you. Well, all right, you get a gift card for your birthday, but when you finally get around to using it, you find out that it's expired. Today, the Federal Reserve issued new rules to keep you from getting stung. Now you will have five years to use the gift cards before they expire. And you'll have to be notified if any inactivity fees are to be imposed. Those rules go into effect August 22nd.

And we all know -- we've heard this before -- you know, portion size is important.

But did you know that there's a connection to the paintings of "The Last Supper?"

Researchers at Cornell University -- they studied more than 50 paintings of Jesus eating with his disciples. And what they found out is that over the last 1,000 years, the size of the food on the table increased between 23 and 69 percent. That's pretty amazing. So perhaps, Wolf, this is an example of life imitating art.

BLITZER: So, you mean we're eating a lot more than they did a thousand years ago?

SYLVESTER: I don't know. Well, you know what it is, is you hear the stories of whether it's bagels or muffins. But now they're making these gigantic sized muffins and these gigantic sized bagels. But, you know, a few years ago, they were tiny little things.

But so across the board, portion sizes are up and that's certainly reflected in these -- these latest paintings -- Wolf.

BLITZER: We tend to super size everything (INAUDIBLE).

SYLVESTER: Yes, exactly.

BLITZER: That's our nature.

All right, Lisa.

Thank you. This hour, U.S.-Israeli relations -- there is a significant development happening as far as those relations are concerned over at the White House right now -- the president meeting with the visiting prime minister, Benjamin Netanyahu. We'll have some insight on what's going on.

And the House speaker, Nancy Pelosi, says she got health care reform passed by refusing to let any Democrats in the House off the hook.

Gloria Borger is just back from a briefing with the speaker.

(COMMERCIAL BREAK)

BLITZER: You're in THE SITUATION ROOM.

Happening now, key intelligence on Al Qaeda and the Taliban -- CNN learns it's not all coming from the CIA.

How is the U.S. military getting this information and is it legal?

We have new information for you.

And authorities are calling it a cold case cracked more than 30 years later. You'll want to hear how police say they have solved the murder mystery of five New Jersey teenagers who vanished without a trace.

I'm Wolf Blitzer.

You're in THE SITUATION ROOM.

The Israeli prime minister, Benjamin Netanyahu, is over at the White House this hour. He's meeting with the president behind closed doors during a relatively stressful moment in U.S.-Israeli relations.

Let's bring in our senior political analyst, David Gergen -- David, he's about to go into the West Wing of the White House. You served four presidents. The prime minister of a close friend and ally like Israel comes to the White House, meets at, what, 5:30 in the afternoon, behind closed doors, no cameras there, no public statements.

What does that say to you?

DAVID GERGEN, CNN SENIOR POLITICAL ANALYST, FORMER PRESIDENTIAL ADVISER: That suggests, Wolf, that this is a very delicate moment. Relations between these two countries and between Netanyahu and President Obama are on a knife edge. And they're -- they're obviously, in the White House, going to be very cautious. You let reporters in there, you start having questions and you never know which way it's going to jump or bounce. And, you know, somebody may say something and then you're -- then you've got -- you worsen the situation. So this is a -- in some ways, Wolf, it's so interesting, because this is almost a mano a mano kind of a situation right now, in which the U.S., in the form of Hillary Clinton and the vice president and now the president, are demanding that Prime Minister Netanyahu give up these settlements in East Jerusalem. And he's saying we're not going to do it. This is -- these are not settlements, this is our capital.

BLITZER: I'll play that little clip. And I want to tell our viewers, we're looking at live pictures at -- at the White House. We expect the prime minister's motorcade to be driving into the driveway any moment now. We'll show that to our viewers.

But here's what the prime minister, Benjamin Netanyahu, said last night at a conference of pro-Israeli activists in Washington.

(BEGIN VIDEO CLIP)

BENJAMIN NETANYAHU, ISRAELI PRIME MINISTER: The Jewish people were building Jerusalem 3,000 years ago and the Jewish people are building Jerusalem today. Jerusalem is not a settlement, it's our capital.

(END VIDEO CLIP)

BLITZER: And you see the limousine bringing in the prime minister of Israel into the White House. They're going to be walking into the West Wing of the White House, moving into the driveway right there -- David, you're very familiar with that scene, as we see the -- the prime minister arrive at the White House for this meeting with the president.

You were going to make a point about that very blunt statement that the prime minister made last night. It comes on the heels of -- of the secretary of State and the vice president basically asking the Israelis, stop building these housing units in this disputed part of Jerusalem.

GERGEN: Yes. It's -- Wolf, this is so unusual. You know this so very, very well -- better than I do. It -- to have this kind of dispute out in the open and to have other parties now looking over their shoulders. In the United States, you've got Republicans and conservatives beating up on the administration for being too tough on Israel. And -- and in the Arab world there, in the Palestinian -- one of the Palestinian leaders said today, unless the United States is much tougher on this, there's a good chance we'll never have these indirect talks until this gets settled.

There's been an effort by the United States that this president, one of his major issues beyond health care, he's got a lot of other things on his plate, has been to restart the peace talks in the middle east and get something done. He really wanted it done by now. So there's a lot to discuss here. And, of course, there's the bigger issue overhanging all of this and that is Iran. For Israel and the United States to have differences over settlements not only can complicate and is complicating how the talks of the Palestinians, but it also could complicate how Iran is handled. BLITZER: Yes. There's a lot of strategic issues.

GERGEN: A lot of them.

BLITZER: You saw that little arrival ceremony. He got out of the limo, walked into the west wing of the white house, received there and now that meeting, we assume, is going to start between the president and the prime minister. We'll see what happens.

GERGEN: Wolf --

BLITZER: If they make a joint statement, if they don't make a joint statement. Right now nothing is scheduled. He's not supposed to go to the microphones, the prime minister after the meeting, he's supposed to go to the limo and leave. We'll see what happens.

GERGEN: I think it's very important what they do now after this meeting. If they come out with a joint statement, that would suggest they really did begin to patch things up. If they leave without a statement, it suggests there's a very frosty situation in the oval office.

BLITZER: I suspect it will be the latter, but we'll see what happens. All right. David, thanks very much.

GERGEN: Thank you.

BLITZER: From tensions with Israel to a lovefest with the house speaker. President Obama warmly embraced Nancy Pelosi after he signed health care reform into law today. Made a point of praising the speaker and other Congressional leaders for what he calls their remarkable victory.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: It's also a testament to the historic leadership and uncommon courage of the men and women of the United States Congress who have taken their lumps during this difficult debate.

UNIDENTIFIED MALE: Yes, we did.

(END VIDEO CLIP)

BLITZER: Stark contrast to the Republicans' attacks on the speaker including the RNC's online push to, quote, fire Pelosi. Our senior political analyst Gloria Borger is back here in THE SITUATION ROOM. He had a briefing with the speaker today. She must be one happy woman.

GLORIA BORGER, SENIOR POLITICAL ANALYST: She was talking about getting fired, Wolf, she was more on fire than anything else. She was energized, relieved, it was as if some huge burden had really been lifted from her. She also said she was completely exhausted. But as you can imagine, looked as happy as the president did today. BLITZER: What did she say about these new ads? The Republicans have raised about a million dollars at her expense, certainly going after her. How does she react when you ask her about that?

BORGER: She was completely dismissive of the ads. She said, I couldn't care less about what they say. And she noted with sort of a smile, gee, do you notice how they called me madam speaker in those ads. I don't spend any time thinking about it, when we asked her how much time, she said, what's lower than a nano-something?

BLITZER: Basically just dismissing it --

BORGER: Like a piece of dandruff.

BLITZER: Those of us who follow the world of politics closely, there are a lot of reports that she and Rahm Emanuel, the white house chief of staff, disagreed on the tactics, the strategy leading up to this day.

BORGER: Well, they did. She corrected the record. You know, there was some reporting that she had called Rahm Emanuel's pared down bill kiddie care. I didn't call it kiddie care. I called it the eensy-weensy spider. It was too small a bill for her. She said, look, Rahm, is perceived as a political operator and he is political, but he's a serious policy person. Then she said, which we enjoyed, she called Rahm a softy. Those of us who know Rahm wouldn't call him a softy. But as a person of a different generation does choose to use different language, not quite as salty as Rahm does.

BLITZER: The fact that she right now arguably is the most powerful woman in the United States, what did she say about that?

BORGER: Well, she sort of smiles about that. She was interesting when you talked about what was it like to be the woman speaker, first woman speaker, health care reform is passed. While she kept saying, I don't want to make too big an issue about this, being a woman, she did say that she's been in a lot of meetings with men who came out afterwards and said to her, can you imagine what this meeting would have been like if a man were in charge? And so she said that perhaps she does have more patience for consensus building, as she put it. Clearly didn't want to put too much emphasis on it but didn't want to step away as the role of the first woman speaker.

BLITZER: She has every right to be happy.

BORGER: She is, she is.

BLITZER: Thanks.

Bailed-out companies beware, if you haven't paid your debt to the federal government, the Obama administration will make you pay in another way.

(COMMERCIAL BREAK)

BLITZER: They took billions in government bailout dollars. Now their top executives are facing a salary cut mandated by the white house pay czar as he's called. CNN's Lisa Sylvester is working the story for us. Tell us the impact of this.

LISA SYLVESTER, CNN CORRESPONDENT: Big impact here. Wolf there are five companies bailed out by taxpayers and haven't paid back that money, AIG, General Motors, GMAC, Chrysler and Chrysler Financial. Now, the federal government's pay czar announced today that the top 25 executives at each of those companies are going to have their cash salaries cut this year by 33 percent. Keep in mind they still will be able to receive additional compensation and stock, but the idea here is to change the way Wall Street does business. Here's what Kenneth Feinberg had to say when I sat down one on one with him today.

(BEGIN VIDEO CLIP)

KENNETH FEINBERG, SPECIAL MASTER FOR TARP EXEC. COMPENSATION: Over 80 percent of the people, the individuals are getting less than $500,000 in base cash salary, some substantially less, as low as $100,000. I think we're driving down total compensation. We're tying compensation to long-term performance. We're trying to change the rules on Wall Street and in corporate America.

(END VIDEO CLIP)

SYLVESTER: One example here, the AIG financial products division. The Obama administration blasted AIG for handing out millions of dollars in bonuses last year after being bailed out by the government. So this year four of the top executives at that division, well, they're going to have their cash salaries frozen in 2010. They will receive additional compensation paid in stock, but that has to be held for a period of time.

BLITZER: I take it Ken Feinberg, the so called pay czar, he's also looking at these companies that received T.A.R.P. money but then paid the money back to the federal government.

SYLVESTER: Yes, indeed, even the companies that have paid back money. What he did was he sent letters to 419 companies that at one point or another received T.A.R.P. money, even the ones that paid it back in full. He's targeting executives who make more than $500,000. He wants to know how much they were paid from the time the companies received government bailout money to February of 2009. By law, we should mention, that these companies have to comply and they have 30 days to respond.

BLITZER: He's a very smart guy, Ken Feinberg. Thanks very much for that.

President Obama wants to make sure voters know this, some key aspects of health care reform will take effect before Election Day. Will that help Democrats in Congress hold on to their majority in November? Paul Begala and Alex Castellanos, they're standing by for our strategy session.

(COMMERCIAL BREAK) BLITZER: Some of the more popular aspects of the health care reform bill are supposed to take effect in the next six months, just in time for the November election. In our strategy session we're joined by our CNN contributors. Democratic strategist Paul Begala, he's a consultant for the Service Employees International Union that has run ads supporting health care reform. Also with us is Republican consultant Alex Castellanos, his firm has done business with health care clients as well. Thanks very much for coming in. I'll be up front with our viewers.

PAUL BEGALA, DEMOCRATIC STRATEGIST: Absolutely. I'm big, big, big for health care.

BLITZER: No secrets here. The fact that some of the so-called good things that the American people will like go into effect just before the elections. Coincidence or not so much of a coincidence?

BEGALA: I wish we were that smart. It is just a coincidence in that the Democrats had hoped to pass this originally the president said by the August recess of '09. So the timing is very fortuitous. The Republicans delayed the bill. The Democrats took a long time too to get their ducks in a row. So now right before the election, lots of good benefits for senior citizens, close down the doughnut hole by 250 bucks, new high risk pool for early retirees which will help them get insurance, help moms and dads carry their kids up to age 26. Just in time for the November elections. Pretty smart, Democrats.

BLITZER: What do you think smart?

ALEX CASSTELLANOS, REPUBLICAN STRATEGIST: I think there are some things in the bill that are popular. Like the accessories on a clunker. You might like a good radio but is the car going to work? In addition to some of the good things, yes, pre-existing conditions, things that will go into effect. You also have half a trillion dollars in Medicare cuts that start this year. Democrats are going to have to explain that to seniors in November.

BLITZER: We saw that Gallup poll that just came out today, the Gallup/"USA Today" poll that showed after it passed the House of Representatives Sunday night more Americans are enthusiastic or pleased about this health care reform now law than not.

CASTELLANOS: Well, I think Paul has a good explanation for that, that what happens in the Democratic Party. And some of it is we're just adaptable people. Once something becomes law, Americans learn, how are we going to live with this? But George Bush owned the Iraq war. Barack Obama and the Democrats now own health care. The precursor of this was what happened in Massachusetts. Romney-care, health care costs there are the highest in the country. If anything like that happens between the next year between now and November, Democrats are going to own it.

BLITZER: These are the midterm elections in November. Look at these CNN Opinion Research Corporation poll numbers that we are releasing now. And it shows a trend for the Democrats, not a good trend. Back in November of last year, only a few months ago, when you asked among -- asked registered voters their choice for Congress, 50 percent said they like the Democrats, 44 percent said they like the Republicans. But take a look now. Forty-five percent say they like the Democrats, 48 percent say they like the Republicans. If you look at trends, that's not a good trend.

BEGALA: And pollsters say trust the trend, that's why you're wise to point that out. That's a nine-point erosion in four months. That's really bad for the Democrats. What they're hoping is that success breeds success. They'll be able to show there are good things in this health care bill and pivot to jobs and take on Wall Street. But if the election were held today -- first, I'd be surprised if it were held today, but it would be terrible for the Democrats.

CASTELLANOS: Congresswoman Holdren in Joliet, Illinois. Right outside of Chicago, a Democratic district, is now six points behind her unknown, unfunded Republican challenger. So yes, we're beginning to see this. This could be like carbon monoxide, this health care reform. You can't see its effect directly, invisible and odorless. But you can see what it does to people. Right now you're seeing Democrats in Congress that didn't want to get caught voting for this, you saw them try to do a demon pass. You are seeing its effect in --

BLITZER: In the end, they didn't do that demon pass.

CASTELLANOS: They tried not to get their fingerprints on it. That tells you.

BEGALA: I think it's not carbon monoxide. Maybe a little red bull, oxygen, a little red bull. I don't know if you can say that in the afternoon.

BLITZER: Will there be a bounce for this present as a result of this signing this bill into law today?

CASTELLANOS: There should be some kind of a bounce for a couple of reasons. One is people, when you look successful, you are successful. Dress for success. Two, the liberals in the Democratic Party, Paul pointed this out to me earlier, that they're going to support this bill now. They may have had doubts earlier. So that's going to consolidate. However, there are a lot of angry Americans out there who don't understand how a nation that's nearly bankrupt whose bond rating is in jeopardy -- credit rating in jeopardy just put another trillion dollar bill out.

BLITZER: Among the Democratic base, there's a new enthusiasm. I sense it over the past couple of days.

BEGALA: Absolutely. I traveled around and I hear it. We were talking about this watching your interview with Senator Kyl, Alex and I were back in the green room. Percentage of people that said they disapproved of this health care plan, a good 10 percent, maybe as much as 20 were single payer or wanted a public option. They're all going to get on board. When they see President Obama and Vice President Biden who said this is a big stinking deal -- used different words -- they think OK, I'm going to get on board.

BLITZER: Thanks very much.

Jack Cafferty is coming up next.

A cold case heating up in a most dramatic way.

(COMMERCIAL BREAK)

BLITZER: Get right back to Jack with "The Cafferty File" -- Jack?

JACK CAFFERTY, CNN CORRESPONDENT: The question this hour is: Where do the Republicans go from here? I like this.

Chuck writes: "They could propose something on term limits? That's certainly a popular idea right now. All this repeal activity and lawsuits about the constitutionality of the health care bill, those are really dead ends and certainly won't do them any good in the mid-term elections."

Jim writes: "The answer's simple. The House and Senate majority for the Democrats will be no more in November 2010. Hopefully the Republicans can stall any other attempts by President Obama to cause any further damage to the country, until the Democrats lose those majorities."

Jesse in Vancouver writes: "Republicans should be very worried, as there are 32 million people in America who now have access to health care and will be healthy enough to vote against all the people who didn't want them to have it."

E. writes: "No ideas, no diversity, no record of helping Americans when they've had the chance. The Republicans have become the party of angry, bitter, reactionary whites. They will go the way of another similar group consisting of such people into the lunatic fringe, along with the KKK."

Tom writes: "Did all Medicare recipients vote Democratic since 1965? Neither will all new beneficiaries of Obama care. More Republicans, fewer Democrats in November."

Doug writes: "Start looking forward, engage constructively in solving our nation's issues and quit trying to fight Obama on every single initiative, otherwise the party of no will get a resounding no thanks from the voters."

And James writes: "I know where I'd like them to go, but I don't think it ought to be read on national TV."

If you'd like to read more on the subject, you'll find on it my blog at CNN.com/Caffertyfile.

BLITZER: I thought it was interesting, Senator Kyl, the number two Republican in the Senate, said to us just a little while ago, they'll spend three days fighting over the so-called reconciliation bill, but they don't have the votes, it will pass, and then they'll have to move on facing reality, I thought that was interesting. CAFFERTY: You know, there's an old expression out in Nevada, where I come from, it's when you're dead, lie down. On this issue, they're dead.

BLITZER: Yes, well, it looks like that reconciliation bill will pass this week, the president will sign that into law, and then the fighting will come beginning November. We'll see what happens.

CAFFERTY: It will be an interesting midst term election, won't it?

BLITZER: We'll watch it.

CAFFERTY: You love that, stuff, too. You'll be so excited.

BLITZER: Thank you.

President Obama signs health care reform into law. You'll see him, in his own words, at the top of the hour. Stand by for that.

Plus, it's a cold case more than 30 years in the making. Now police say they've cracked it.

(COMMERCIAL BREAK)

BLITZER: It's the ultimate cold case, more than 30 years after the disappearance of five teenagers made headlines; police say they finally have a break. CNN's Mary Snow is monitoring this story.

(BEGIN VIDEOTAPE)

MARY SNOW, CNN CORRESPONDENT: It's a case that's baffled police from the start. Five teenage boys vanish without a trace in Newark, New Jersey, on an August night in 1978. More than 31 years later, Terry Lawson says she's in shock that she now may have answers about what happened to her brother, Michael McDowell.

TERRY LAWSON, SISTER OF VICTIM: I could not stop shaking. And it still it's unbelievable. Unbelievable. But it's the truth. Its day has finally come.

SNOW: Did you ever think it would come?

LAWSON: I just believed in god, that this day had to come.

SNOW: Police arrested Lee Anthony Evans and Mr. Hampton and charged them with five counts of murder and arson. Evans was a handy man and offered the teens part-time work. Police say he was a suspect all along. The night her brother disappeared, Lawson said she last saw him in a truck with Evans.

LAWSON: Is it closure? No. It's confirmation of what we've known so long. We've known, from the moment I seen my brother get in that truck, it never, never any doubt in my mind that that man had something to do with my brother never coming home. SNOW: So, why the break now? Police say a witness came forward 18 months ago and started cooperating. Police now believe that the five teenagers were taken to this street here in Newark, New Jersey, on the night of August 20th, 1978. They believed the boys were taken into a home, restrained, and then the house was burned to the ground. But police have still not been able to find any remains. Detectives believe the motive was tied to the teens stealing marijuana from one of the suspects, but Helen Simmons has her doubts. She's the aunt of Michael McDowell and has saved every newspaper article about the case.

HELEN SIMMONS, AUNT OF VICTIM: I always felt that it wasn't just the marijuana, that there had to be something bigger. You killed five people. You killed five boys. Over marijuana? That didn't make sense to me.

SNOW: Citing their case, authorities withheld other details of the investigation but called the arrests a small step toward justice.

MAYOR CORY BOOKER (D), NEWARK, NEW JERSEY: There's been an anguish that's been hanging on the hearts of our city now for over 30 years.

SNOW: But Helen Simmons finds little comfort.

SIMMONS: Of course, I'm still angry. Because had you done what you needed to do back then, we would not be here 31 years later. Not knowing what happened to these kids.

(END VIDEOTAPE)

SNOW: Now, Wolf, tomorrow in Newark, the two suspects are scheduled to be arraigned. A public defense lawyer for Hampton declined comment. And prosecutors say they're not aware of any lawyer representing Evans. There was a third defendant. Authorities say he died two years ago -- Wolf.