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THE SITUATION ROOM

Airports Are Reopening Across Europe; Fiery Blast on Gulf Oil Rig

Aired April 21, 2010 - 18:00   ET

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


JESSICA YELLIN, CNN CORRESPONDENT: Wolf Blitzer is off today. I'm Jessica Yellin. Welcome to our viewers in the United States and around the world. You're in "The Situation Room."

Airports are reopening across Europe, raising hopes for thousands of stranded passengers six days after a giant cloud of volcanic ash caused global gridlock. Authorities had shut down airspace because of fears that the ash could shut down jet engines, causing a potential catastrophe. A short while ago, I asked Richard Branson, the billionaire founder of the Virgin Group, if he'd feel safe flying now. Listen to this.

(BEGIN VIDEO CLIP)

RICHARD BRANSON, FOUNDER, VIRGIN GROUP: Personally, I would have felt safe flying anytime the last couple of days.

YELLIN: Really? You wouldn't have shut airspace?

BRANSON: Well, I think that, you know -- I think governments will accept in retrospect that they have -- you know, didn't do everything that they could have done quickly enough in sort of sending up planes, you know, checking out just how thick -- how thick the ash was, whether there was safe corridors for planes to fly.

I mean, I would not want to fly, you know, through the heart of the volcano, because it will, you know -- it can and has done in the past, affect the engines. But many, many miles away there are safe passages that planes should be able to fly, you know, at, you know -- between north and 30,000 feet, you know, the sky was generally clear.

So, you know, possibly planes could have taken off low and then, you know, flown out of the problem and then gone up high. And I think that it's an extremely unlikely that the whole of Europe will ever be closed again. I think governments will learn from this, and it's easy to talk after the event, and they'll make sure that, you know, that they learn from this and make sure something like this never happens again.

(END VIDEO CLIP)

YELLIN: We'll have more of my interview with Sir Richard Branson later.

But this volcano, it has a twin, and if it wakes up, things could get a lot worse. CNN's Gary Tuchman is on the scene in Iceland.

GARY TUCHMAN, CNN CORRESPONDENT: That's the volcano that we affectionately call E-15. E for the first letter of the volcano, 15 for the next 15 letters are very hard for English speakers to announce.

But here's the other story that's very interesting. Just to the left of this volcano is another one in the distance. It's called Katla. Katla is a much more powerful volcano historically when it erupts. And the president of Iceland caused some controversy this week when he said that this volcano currently is just a dress rehearsal for Katla. It angered tourism officials because they're afraid it will scare people from coming.

But Katla has had eruptions much more frequently over history than this one. And coincidentally, we're not sure if it's a coincidence or we're not sure if they cause each other to erupt, but they've happened at the same time several times over the last few centuries. So there are some people who are concerned that Katla could ultimately erupt because of the eruption of this one. And if Katla erupts, in a worst case scenario, they're saying there's so much glacial water inside, that's six times the amount of water in the Amazon River, and would cause immense flooding.

So, once again, we want to emphasize that because this one's erupting does not mean necessarily Katla will erupt, but historically they have erupted at the same time. So there's a lot of tourism officials here that are a little angry at what the president said. But the president said, hey, it's just important to be honest about history.

YELLIN: Gary Tuchman in Iceland.

And now another major story developing in the Gulf of Mexico. Eleven people are missing after an explosion and fire on an offshore oil rig. There are also a number of injuries in the blast. Coast Guard cutters and helicopters are on the scene off the Louisiana coast. Now, let's get the latest from CNN's David Mattingly. David, how did this happen?

DAVID MATTINGLY, CNN CORRESPONDENT: Well, Jessica, it was a catastrophic disaster at sea, a column of fire blasting into the sky. The explosion happened aboard a mobile offshore drilling unit called the deep water horizon. It erupted with 126 people on board. Eleven are still unaccounted for, and haven't been seen since the explosion late last night.

The Coast Guard evacuated 17 injured from workboats, three are described as critical. This happened 52 miles southeast of Venice, Louisiana. The facility has been drilling for gas and oil on the spot since January. Now, no one knows yet what sparked the explosion. One possible answer is a pressurized eruption of oil and gas. It's what the industry calls a blowout.

(BEGIN VIDEO CLIP)

GREG MCCORMACK, UNIVERSITY OF TEXAS: Apparently in this case, it wasn't controlled, and it must have had an equipment failure as well as the blowout prevent that's supposed to prevent anything like this occurring.

(END VIDEO CLIP)

MATTINGLY: Right now, the Coast Guard says they have no idea where the missing 11 might be. They are prepared, Jessica, to search through the night, again, using infrared devices this time.

YELLIN: David, is there any word yet on how long it could possibly take to extinguish the fire and then cap these emissions?

MATTINGLY: No, not yet. And when they finally do, that's when it's really going to start to get dicey environmentally. When they put this fire out, we could be looking at another disaster. The Coast Guard right now is watching an oil spill from the air and reports that the pollution so far seems minimal, with most of the oil burning off. But once that fire is put out, that oil conceivably could go into the Gulf of Mexico, if they aren't able to cap these releases. So, this disaster not over yet, even after they put that fire out.

YELLIN: Oh, what a mess. Thank you, David -- David Mattingly, reporting.

Well, believe it or not, the Arizona House has passed a measure that would require President Obama to show his birth certificate in order to get on the state's ballot for re-election. Critics are scoffing at what they call the birther bill. It would require all presidential candidates to prove they were born in the United States.

Let's get reaction from CNN's Jill Dougherty. Jill, what is the White House saying about this?

JILL DOUGHERTY, CNN CORRESPONDENT: Well, Jessica, basically, you know, they're kind of spotting it off as a bit of political insanity, but, you know, this issue has been with the president dogging him since 2008, during the campaign. And the campaign at that point actually released a copy of the president's birth certificate. And CNN did its own investigation. It found a copy of that birth certificate and also a birth announcement from that period, when the president was born.

And essentially confirmed what the White House was saying. So, here's what the White House spokesman, Robert Gibbs, a frustrated Robert Gibbs, said today at the briefing.

(BEGIN VIDEO CLIP)

ROBERT GIBBS, WHITE HOUSE SPOKESMAN: We don't spend a lot of time here worrying about what to do about people that don't think the president was born here.

(END VIDEO CLIP)

DOUGHERTY: Yeah, so that's -- that's Robert Gibbs answering the question yet again, Jessica. YELLIN: You know, you kind of wonder if this issue will ever go away.

DOUGHERTY: You know, in a way some people, I guess including myself, don't think that it really will, because these things really once they're on the Internet and they're in talk shows, radio talk shows, et cetera, do have a life of their own. But it does allow the White House, even though it must be frustrating to go over this all the time, it allows them to depict critics of the president as kind of an unstable fringe element, and that works to their favor, sometimes.

YELLIN: Excellent point, Jill Dougherty at the White House.

A long line to get into a Senate committee meeting on financial reform. Who are these people, and why are they so eager to get a seat?

Plus, the NFL announces the punishment for Ben Roethlisberger, accused of, but not charged, with sexual assault.

(COMMERCIAL BREAK)

YELLIN: Jack Cafferty is here now with "The Cafferty File." Hey, Jack, what do you have this hour?

JACK CAFFERTY, CNN CORRESPONDENT: With the United States fighting two wars and threats from a potentially nuclear-armed Iran on the horizon, there's a very scary truth that ought to be addressed.

Three-fourths of the young people in this country between the ages of 17 and 24, are unfit for military service. And that's a national disgrace. There are a number of reasons for a lack of sufficient pool of recruits for the military to draw from. They include things like having a criminal record, not graduating from high school, or having health problems.

But the biggest single reason is that a boatload of our young people in this country are fat. In a report titled "Too Fat To Fight," a group of 130 retired military leaders says the top medical reason is young people are simply too heavy, and cannot handle the physical requirements of military service. One-fourth of Americans, too fat to fight to protect this country.

The report blames unhealthy food in school lunchrooms and they're calling on Congress to pass a wide-ranging nutrition bill that should make meals healthier, but the problem extends far beyond the school lunch room. We've become a sedentary society. We don't exercise enough, spend too much time in front of the TV or computer, and exist on a diet of fast food and/or junk food. The price tag eventually for that is sacrificing the future of the U.S. military.

The authors of this troubling report say that currently all branches of the military now meet or exceed their recruitment requirements, but if the obesity trends don't change, they could wind up threatening national security by the year 2030, less than 20 years from now. Here's the question -- what does it say about our country if three-quarters of our young people are unfit for military service? Go to CNN.com/CaffertyFile. Post a comment on my blog.

YELLIN: You know, Jack, this is Mrs. Obama's big issue, let's move, get people moving and losing weight, huh?

CAFFERTY: Well, it's one of the things that she's addressed, yeah. It's -- it's a problem that's gotten so big and caused so much trouble, that I'm not sure a campaign like just say no or go do some push-ups is going to solve it. And you got to remember, the big corporations that make all this processed food that we eat, they're not going to be real anxious for that government thing down there where you are to change the rules, are they?

YELLIN: Blaming Washington. All right, thanks, Jack.

CAFFERTY: Well, who else is to blame?

YELLIN: I take your point. I take your point.

And here in Washington, Democrats are pushing forward with a bill that's aimed at reforming Wall Street. Republicans have plenty of objections to that legislation. And they just ended a meeting over how to proceed with it. Earlier, a Senate committee approved related legislation which would limit Wall Street's ability to trade those controversial derivatives. CNN's senior congressional correspondent, Dana Bash, is here. Dana, first of all, senators weren't the only ones in the room today, were they?

DANA BASH, CNN SR. CONGRESSIONAL CORRESPONDENT: No, they weren't. The other people in the room were lobbyists, shocking.

YELLIN: Shocking.

BASH: But, you know, so many interests have so many billions at stake with financial reform, that that sector has spent over $455 million and counting on lobbyists who are scrambling to protect them.

(BEGIN VIDEOTAPE)

BASH (voice-over): Who's waiting in this long line to get into a key Senate committee meeting on financial reform? A lot of lobbyists. The reason for the line is inside this room, senators are working on details of legislation that would for the first time establish oversight on the financial derivatives market. We're talking about hundreds of trillions of dollars in deals, the kind that led to the panic that helped cause the near collapse of the financial industry.

SEN. BLANCHE LINCOLN (D), ARKANSAS: Within a decade, this market exploded to $600 trillion in notional value. We must bring transparency and accountability to these markets.

BASH: In the back of the room you see the committee, and what they're doing is poring over this legislation, line by line, and that's why you have this, lobbyists. They are here watching very carefully. And the lobbyists here represent some of the big banks on Wall Street, who reap billions of dollars in profits from this mostly unregulated derivatives trading, but it's not just them. There are also lobbyists here representing farmers, manufacturers, and businesses, who want to preserve their bottom line. They say that bottom line is helped by derivatives trading. That's why this lobbyist, representing an agribusiness is here. You want to make sure that they don't go too far.

JON HIKSON, LOBBYIST: We need a balanced bill that adds transparency and does a lot of the good things but, again, still allows U.S. manufacturers to be competitive.

BASH: You're a lobbyist.

DOROTHY COLEMAN, LOBBYIST: I am.

BASH: Lobbyists as you know maybe don't have the best reputation in this country and certainly at a time when people are pretty angry at Washington. What do you want people to know about your job as a lobbyist?

COLEMAN: Well, I think were first of all, I'm an advocate for manufacturing and my efforts really are trying to educate members of Congress and their staff on the impact of legislation on the manufacturing sector.

BASH: And what about the lobbyists from Wall Street banks and big financial firms, concerned about new regulation? Well, we found several, but they didn't want to talk to us on the record, until we tried this approach.

I'm Dana Bash with CNN. How are you? He's a Washington lobbyist. Who does he represent? Any big banks?

JAKE SEHER, LOBBYIST: No.

BASH: Any financial firms at all?

SHRER: Several financial firms. We're mostly following this development. This is a very important issue here. And it has great implications for any number of institutions, not just on Wall Street but across the country.

(END VIDEOTAPE)

BASH: Now later, we did talk to an official representing big Wall Street banks who said they are still pushing back hard against the bill that passed committee today, because several provisions would make it harder for them to make billions in profits. But more and more, it looks like Wall Street has an uphill fight in Congress. One Republican, that's right a Republican, Charles Grassley, voted with the Democrats today to crack down on controversial derivatives trading, and tonight, it does look like bipartisan talks on a more broad financial reform package are still in the works.

YELLIN: OK, first, kudos, I know how hard it is to get any lobbyist ever to talk on camera. So bravo to you. There was a meeting on Republicans meeting on financial reform tonight. It broke up. Any progress?

BASH: Mixed. Ted Barrett, our congressional producer, just was there, and just said that there were several Republicans coming out, including Richard Shelby, who is the ranking Republican key player in this, said that there is progress. But another key Republican, Bob Corker, he told Ted that he is relatively depressed.

YELLIN: Depressed.

BASH: Coming out of this meeting with Republicans. So, it's mixed. Democrats say they are going to push ahead with a vote to move on this on Monday, but the hope still, it actually does seem to be earnest hope, you know this Jessica, on both sides of the aisle. It's rare but it's earnest, to try and get bipartisan agreement on this very, very important deal.

YELLIN: Trying for a deal, but otherwise the Democrats will move for it on their own.

BASH: Exactly.

YELLIN: Thanks, Dana Bash.

All right, if the bill to reform Wall Street does head for a compromise, Democratic leaders may find some new problems on their left flank. Senator Sherrod Brown of Ohio is a Democrat and he's on the Senate Banking Committee. He says the financial reform bill just doesn't go far enough, so he and like-minded Democrats, they're introducing their own legislation aimed at big banks. Listen to this.

(BEGIN VIDEO CLIP)

YELLIN: Your legislation would try to end too big to fail. Now this is a criticism we've heard coming from Republicans. They say the current bill doesn't end too big to fail. So, what are you proposing that is different from what Republicans would want?

SEN. SHERROD BROWN (D), BANKING CMTE: Republicans are just, frankly, trying to find a reason to oppose this bill. Based on the fact that their biggest benefactor is Wall Street. They're looking for a reason to criticize the bill. They know they want to defeat the bill. That's what all the Washington lobbyists are pushing them to do.

If we're going to solve this, we can talk about how to -- how to -- how to help banks -- how to deal with banks when they're -- when they're starting to fail, but I want to make sure banks don't get so big in the first place that they do --

YELLIN: Our proposing to break them up in essence, yes?

BROWN: We're not proposing to break them up. We're proposing if they through mergers and purchases and other ways get too big, to make them spin off small parts of their deposits or small segments of their services. But, no, I don't want to break up the banks, but I don't want the banks to get so gargantuan, as they have, that they put in jeopardy the entire financial system.

YELLIN: But are you letting the perfect be the enemy of the good here?

BROWN: No, it's not a question of letting the perfect be the enemy of the good, it's the question of putting the bill on the floor and letting us debate it and then whatever a majority or 60 votes passes it, we move forward. The Republicans want to not even give us the chance to talk about it. They clearly are doing the bidding of Wall Street. Wall Street is their biggest benefactor. That's why we need to pass a bill good for investors, good for consumers and good for small business so we can start loaning to manufacturers and people in Cincinnati.

YELLIN: But lobbyists speak to Democrats as well. They are up there to talking to members of the banking committee on both sides. Democrats take plenty of money from lobbyists, or from Wall Street. Why don't Democrats just kick them out? They're in charge, say go away?

BROWN: The fact is that Republicans have done the bidding of Wall Street, just like Republicans during the health bill did the bidding of the insurance industry. And all you got to do, there's a -- there's been -- you know, when -- when you -- when you throw a rock at a pack of dogs, the dog that howls is the one you hit.

That's why Mitch McConnell is yelping so much when Democrats say simply we know you're talking to Wall Street, we know you want to kill this bill, he comes up with other public reasons, but that's his mission. That's how he thinks he's going to elect Republicans by raising millions of dollars from Wall Street.

YELLIN: Let me ask you quickly, do you want the lobbyists from labor unions that agree with you on too big to fail, do you want them excluded as well?

BROWN: No, I want to do the right thing for consumers. Wall Street has stood in the way of -- first they caused this implosion of the economy. Second they're standing in the way of recovery, that's why we have to pass this legislation.

(END VIDEO CLIP)

YELLIN: He introduced his own legislation today.

All right, Super Bowl-winning quarterback Ben Roethlisberger sidelined for a significant part of the season. Details of the punishment just handed down by the NFL. Plus, that balloon boy hoax, we're now learning it's going to cost the parents a lot of money.

(COMMERCIAL BREAK)

YELLIN: Lisa Sylvester is monitoring some of the other top stories in "The Situation Room" right now. Hey, Lisa, what do you have?

LISA SYLVESTER, CNN CORRESPONDENT: Hi there, Jessica.

Well, a six-game suspension for Pittsburgh Steelers' quarterback Ben Roethlisberger. The NFL announced the punishment today for what is called conduct detrimental to the league. Roethlisberger was accused of sexually assaulting a woman in the bathroom of a Georgia nightclub. Prosecutors decided not to charge him, but the investigation showed he helped to provide alcohol to underage girls who were already drunk.

Pope Benedict made his first public remarks about the sexual scandal rocking the Catholic Church in his weekly public audience at the Vatican. He spoke of his meeting Sunday with the victims in Malta. He said he shares their suffering and that he prayed with the men and promised the church would take action, although no details were given.

In Afghanistan, a dramatic example of the dangers facing NATO forces. The Afghan army destroyed more than two tons of ammonium nitrite, that's the fertilizer that's used in more than 90 percent of roadside bombs. President Hamid Karzai banned ammonium nitrate in February, but just yesterday Afghan border police found more than 3,000 pounds of it in vehicles near the Pakistan border.

And the final and costly chapter in that balloon boy hoax, you'll remember that from last October. Richard Heene and his wife, they have agreed to pay about $36,000 restitution to agencies that responded when they claimed their son was trapped in a runaway, homemade balloon. Those agencies had been seeking $48,000. The Heenes pleaded guilty in that case. They also had some jail time, I think Richard Heene, I think got about 90 days or so.

YELLIN: Right, I think they both --

SYLVESTER: Yeah, I think they both did. I think she got about 20 days. But what a horrible story, just, you know, I mean as far as parenting goes. That's not necessarily the best example.

YELLIN: They need a few classes, yeah, thank you, Lisa.

SYLVESTER: Thank you.

YELLIN: Well, he wants to take you into space, but billionaire entrepreneur and adventurer, Richard Branson also wants to protect Planet Earth. My interview ahead.

And meet the new Ben Franklin, the $100 bill gets a makeover with 3D security and other features aimed at foiling counterfeiters.

(COMMERCIAL BREAK)

YELLIN: Richard Branson, the billionaire entrepreneur and adventurer is chairman of Virgin Group, and, of course, he founded Virgin Airlines. He wants to take you into space, but he's also working to protect this planet. (BEGIN VIDEOTAPE)

YELLIN: Sir Richard, thank you for joining us today. First, let's start, why are you here in D.C.?

BRANSON: Well, it's -- it's graduation day. I've never been to university. But it's graduation day for the carbon war room, which is a new venture we've launched to in a sense take a -- take on carbon and to help companies work out ways where they can make money, but at the same time, save the environment. So, we've got a lot of entrepreneurs together, and we're working together to try to work out, you know, how best to set about doing it.

YELLIN: Climate change is a big concern of yours, clearly. At the same time you're a jet-setter, you know, I imagine you sometimes fly private and you travel the world. Did you ever feel guilty about lifestyle versus ideals?

BRANSON: Yes, to an extent. But I think realistically the world -- the world has got to go on forwards, planes have got to carry on flying, you know, ships have got to carry on plying their goods, and so it's up to -- up to us, to come up with scientific ways of addressing the problem.

So, you know, let's come up with alternative fuels that don't eat into the food supply, that are clean fuels, you know, let's think of ways of conserving. And, you know, let's just try to get on top of the problem, and I think that -- you know, I think we can have fun making money and getting on top of the problem.

YELLIN: And enjoying the money?

BRANSON: And why not enjoy it as well?

YELLIN: You also own one of the largest airlines, and we know, we've been covering how the airlines have been grounded in Europe for almost a week because of the volcanic ash. How much of an impact did that have our business? How much did you guys lose?

BRANSON: It's had a horrendous impact on the airline business. It's had an even worse impact on our passengers. You know, we've got passengers still stranded all over the world. We're not going to necessarily have enough planes to get them back for a few -- a few more days. We're hoping that governments may be able to, you know, help us by finding more planes to help, you know, repatriate --

YELLIN: Government planes, really?

BRANSON: Whatever it takes. You know, they're doing it with ships, and I think that we just need to -- we need to get as many of the passengers back home as soon as possible.

YELLIN: I'm curious, how long do you think it will take to get back up to speed?

BRANSON: It's -- it's really -- I'm not absolutely sure, but, I mean, I would say that some passengers may still be stranded for another week or two, because you've got -- you know, you've got all the current passengers that want to fly. Plus you've got the enormous backlog of nearly a week's worth of passengers. And all the planes were full anyway. So I think in order to make sure that all passengers have got back, it would be helpful if governments could actually help the industry get them back. And otherwise, I think, people are going to have to suffer longer than necessary.

YELLIN: And Spirit Airlines here in the U.S. has decided that they're going to charge $45 for every passenger who brings a carry-on bag -- $45 per carry-on bag. It sparked outrage across the country.

Will you vow here and now that Virgin Airlines will ever do that?

BRANSON: I don't think it's a very spiritual thing to do. I don't think -- I don't think it's a very wise thing to do. I mean, there was an airline in Europe called Ryanair that went even further, and they were talking about charging to go to the lavatory.

YELLIN: Yikes.

BRANSON: And so -- so, I think that -- I don't think it -- I don't think it makes -- I don't think it will make you very popular. No.

YELLIN: So, that's a no. You'll never do it.

BRANSON: Look, if everybody else is doing it and we -- and suddenly, our ticket price looks horribly expensive, you know, I'll never say never. But I think it's extremely, extremely unlikely.

YELLIN: OK.

President Obama has talked about a subject close to your heart, space travel. He has said that the U.S. doesn't need to be spending scientists' money, NASA's money, going to the moon, but private industry could do it.

Will you be the man who takes us to the moon next?

BRANSON: I'd love to be the person to take you to the moon. And generally I agree with President Obama. I think that you -- that private enterprise can do things at half the price that governments can do it. I think they still need to keep NASA as a body to monitor and oversee the private industry. But the more private industry does it, the further, I think, that man will go into space.

And, you know, Virgin Galactic is, you know, nearly ready to take you --

YELLIN: Or you.

BRANSON: -- or me into space. And, you know, the spaceship is finished, the mothership is finished, the test flights are starting. And hopefully, next year, we'll be up, up, and away.

YELLIN: So, could we see Sir Richard Branson landing and walking on the moon?

BRANSON: I would love to in my lifetime and, you know, if there are -- I think what NASA thinks of doing is giving grants to private companies to do these things, and we're certainly be putting our hand out for some of those grants. And, you know, whether it's moon landing or mars landing, we're certainly keen to be involved.

YELLIN: Well, we look forward to getting the first interview of you on the moon.

BRANSON: I look forward to talking to you.

YELLIN: Thanks so much, Sir Richard.

BRANSON: You're going to have to be on the moon, of course, with me.

YELLIN: I'll consider it.

BRANSON: Thank you.

(END VIDEOTAPE)

YELLIN: And five years after the Bush administration established a national director of intelligence, is America any safer?

Plus, the tea party's spiritual side. Will the movement usher in a new "Great Awakening"?

(COMMERCIAL BREAK)

YELLIN: The Office of the Director of National Intelligence was created five years ago today.

Joining me now is CNN national security contributor, Fran Townsend.

Fran, you were in the Bush White House when this office was created. The goal -- as I recall, I was covering the White House at the time -- was to streamline the bureaucracy. Did it do its job five years later, or has it created a new bureaucracy?

FRANCES FRAGOS TOWNSEND, CNN NATIONAL SECURITY CONTRIBUTOR: Well, Jessica, as typical in Washington, it's a little bit of both.

You know, things like the National Counterterrorism Center and the National Counterproliferation Center, mission managers who tackle the toughest issues of the intelligence community like Iran, North Korea, our relationship with China and Russia. Those sorts of things are working much better. They are pulling information from across the intelligence community and serving it up to policymakers in a much more integrated way. That's the good news.

But as you remember, Jessica, one of the things was that President Bush wanted a community manager, an enterprise manager, if you will, that looked across the community, looked at budget, looked at standards, training, language capability -- and those sorts of things, there is a sense, that that's not going as smoothly as we'd like. We're not getting the value that we'd like. But progress has been made. And so, you know, with any new enterprise, sometimes that progress is slower than you'd like.

And it was interesting -- today at the anniversary ceremony, the director of national intelligence talked to his enterprise management, his community management responsibilities. And I think what we're seeing is he understands that's where the new -- the emphasis in the next five years needs to be.

YELLIN: You know, Fran, it's not just the bureaucracy but the personalities. And in both your administration and the current one, it's well known in Washington that there had been turf wars between CIA and the DNI. So, did this new position actually complicate things in that sense?

TOWNSEND: Well, let's remember, you know, it's interesting -- the DNI is supposed to oversee the entire intelligence community, all agencies of the intelligence community, but he only has one direct report and that's the CIA. So, what does that -- what that means is, he spends an awful lot of his time, sort of, if you will, to use a Washington phrase, checking the hallmark of the CIA director and that's very much resented.

You know, it's interesting. It is a personality clash. Director Panetta -- I sit on his advisory board -- he's really done a tremendous amount of good work in raising the morale, raising the profile of the CIA, and solving -- going a good distance to solve the CIA's problems with Capitol Hill.

So, I think what you need to see here is not so much personality, but each needs to do what their primary function is. The DNI needs to focus on the community and allow the CIA director to focus on the operations and the health and well-being of the CIA.

YELLIN: All right, Fran Townsend, joining us from Harvard University -- thank you so much.

TOWNSEND: Good to be with you, Jessica.

YELLIN: And Lisa Sylvester is monitoring some of the other top stories in THE SITUATION ROOM right now.

Hi, Lisa. What do you have?

LISA SYLVESTER, CNN CORRESPONDENT: Hi there, Jessica.

Well, President Obama said he had nothing to do with the decision to charge Goldman Sachs with fraud. The Securities and Exchange Commission brought the case against Wall Street -- the Wall Street giant -- just one day before the president and Democrats laid into Republicans for opposing financial industry reform efforts. In an interview with CNBC, the president denied any White House involvement in the case, and says he learned about it on TV. General Motors has made the final payment on the government loans that kept it from going out of business. Yesterday, the company wired $4.7 billion to the U.S. government, and $1.1 billion to the Canadian government. But American taxpayers are still majority shareholders in G.M. with a 61 percent stake in the company.

And a new rare move, the House Ethics Committee has launched a formal investigation in to allegations against a former lawmaker. The panel says it will look into sexual harassment claims against Democrat Eric Massa. You'll recall that Massa resigned amid questions about inappropriate physical contact with male staffers. Republicans have questioned whether Democrats responded properly to rumors about Massa's behavior.

And the tea party movement is ushering in an American spiritual revival. That's at least according to Republican Senator Jim DeMint of South Carolina. He tells the Christian Broadcasting Network that tea party gatherings have a spiritual component which he compares to the Great Awakening that preceded the American Revolution. DeMint has become a favorite of the movement with his endorsements of candidates also backed by the tea party -- Jessica.

YELLIN: All right. Thank you, Lisa.

Ben Franklin gets a makeover. You'll see the new C-note with its new design aimed at foiling counterfeiters.

A high-level huddle at the White House: President Obama meets with Senate leaders to discuss his upcoming Supreme Court nomination.

(COMMERCIAL BREAK)

YELLIN: President Obama met with senators from both sides of the aisle at the White House today to talk about the upcoming vacancy on the Supreme Court.

Let's get some insight from CNN's John King, whose show, "JOHN KING, USA" starts at the top of the hour.

John, we all know that the president makes up his own mind on these nominees. So, what's the point of meeting with Senate leaders for him?

JOHN KING, HOST, "JOHN KING, USA": Well, you know as well as anybody the current mood in this town. After the health care debate, in the middle of the financial reform debate, there's a lot of partisan divide. What the president is trying to say, at least, I'm going to reach out. The Republicans might not like my pick or might not vote for the pick, but before I make the pick, we'll bring you all into the room, we'll have a conversation, what's in, what's out, what are the big issues.

Mostly, the president today wanted a commitment from the Republicans that if he sends a name in the next couple of weeks, it would be slightly ahead of the Judge Sotomayor schedule, that they would act in the judiciary committee. And assuming the nominee gets voted out of the committee, get to the full Senate in time to have a confirmation done before the Senate breaks in August.

YELKLIN: Well, Senator Leahy has said -- the Democrat who runs judiciary -- has said that he thinks the court is too far to the right, the current court. It sounds like they are trying to nudge the president to pick someone to the left.

Is that the sense you're getting?

KING: Absolutely. There -- a lot of the intellectual firepower on the left says: A, we need a more feisty, liberal justice; B, you're losing Justice Stevens who has standing, gravitas, seniority, expertise in working the politics of the court, so let's get an intellectual firebrand in there to do battle with Scalia, with the Chief Justice Roberts if necessary, with the more recent picks, Judge Alito from the Bush administration.

However, the president has a big choice to make. How far left do you go? Of course, he'll go left of center. The president is left of center. It was quite telling today when he was asked if abortion is a litmus test, he went beyond what past presidents have said. In his language, he said, no, and then he said sort of.

Now, he won't ask a judge that question. But in looking for their record, he'll go back and look at the privacy issues.

So, of course, he'll be left of center. The big challenge for the president is: how far left do you go?

YELLIN: Well, that's the question. In this political environment and given that it's an election year -- does he have the wiggle room? Because it's a court nominee, it's not some larger political legislation. Will the senators -- Republican senators give him leeway to pick someone his way (ph)?

KING: The fascinating question is: will the Democratic senators give him leeway? Because there are some on the left saying: pick a fight, Mr. President, fire up our base. Nothing gets both bases fired up like a good fight over judicial nomination. But there are a number of vulnerable Democrats who you would call more centrists, or who need to get moderate and centrist votes in their elections, even though they might be more to the left side.

Some of those Democrats they are sending signals to the White House and through their leadership in the Senate, saying, we don't really need a huge fight about this. Let's not get into a left/right battle over this. Pick somebody left of center but closer to the middle for them.

So, the interesting pressure actually at this moment comes from within his own party, not the Republicans.

YELLIN: And I know you're talking about this in your show coming up.

KING: We're going to have Jeff Sessions, the senior Republican, in and we'll also have a conversation at the beginning of the show about whether the current court understands what we go through in life, whether it's plugged in to all the technologies that so define our days.

YELLIN: We'll be watching. Thanks, John.

KING: Thank you.

YELLIN: "JOHN KING, USA" coming up.

A face lift for Ben Franklin? The $100 bill gets a makeover aimed at foiling imitations.

CNN's homeland security correspondent, Jeanne Meserve, is here.

Jeanne, a new C-note?

JEANNE MESERVE, CNN HOMELAND SECURITY CORRESPONDENT: Yes.

And, first, some little known facts for you -- did you know that the most commonly counterfeited bill in the U.S. is the $20, but overseas, it's the $100 because that's what international travelers often have in their pocketbook. A new bill design unveiled today, however, is intended to curb that crime.

(BEGIN VIDEOTAPE)

UNIDENTIFIED FEMALE: It is my pleasure to now show you the new $100 note.

MESERVE (voice-over): The new bill has two new security features, a 3D ribbon and a color-shifting bell and an inkwell, supplementing other features -- all engineered to thwart counterfeiters.

JOHN LARGE, U.S. SECRET SERVICE: The advent of high-speed computers and good technology, people can counterfeit on demand.

MESERVE: Less than 0.001 of 1 percent of the U.S. currency in circulation is counterfeit, but in some cases, security features have been circumvented.

KELLY HARRIS, U.S. SECRET SERVICE: They chemically remove the ink from a genuine $5 bill and then reprint the blank paper with the counterfeit image of a $100.

MESERVE (on camera): And, if you look, you would see some kind of a watermark there.

HARRIS: They would see watermark. It's Abraham Lincoln. So, it's not the correct watermark, but it's a watermark image.

MESERVE (voice-over): What the Secret Service has learned about counterfeiting techniques was incorporated into the new design, which took about 10 years to engineer.

MICHAEL LAMBERT, FEDERAL RESERVE: You can't underestimate the counterfeiters. So, really, what we're trying to do is to constantly raise the bar.

MESERVE: Each of the new bills will cost about 11.8 cents to produce, 4.5 cents more than the current $100. It will go into circulation in February of next year. But the $6.5 billion older- design $100s already in circulation will still be good.

(END VIDEOTAPE)

MESERVE: The security features on the bill are big and they're bold and that is intentional. Officials say, if citizens and merchants can easily determine if the bill is real, counterfeiters will have more trouble passing off their fakes -- Jessica.

YELLIN: So, what's the most striking change in the new bill?

MESERVE: For me, it was the color. You have the blue strip. You have an orange little --

YELLIN: Mark?

MESERVE: -- mark on there. And the whole bill itself is sort of tinted blue. So, I guess you can't call it a green buck anymore.

YELLIN: Oh, good point.

This stuff is fascinating. Thanks, Jeanne.

MESERVE: You bet.

YELLIN: All right. Jack Cafferty is next with your e-mail.

Plus, a ride unlike any other -- falling from 108 stories from above the ground. CNN's Jeanne Moos takes a most unusual look.

(COMMERCIAL BREAK)

YELLIN: Time now -- time now to check back with Jack Cafferty who has your e-mails.

Jack, what are people saying?

JACK CAFFERTY, "THE CAFFERY FILE": The question this hour is: what does it say about our country if three-fourths of our young people are unfit for military service?

Mark writes from Oklahoma: "You should see the huge 12 and 13- year-olds at the middle school where I teach. All they want to do is cuss, eat, slap each other's butts and be disrespectful. It's a hell of a generation we're raising because some idiots decided discipline was no longer needed in the schools. Well, guess what? Kids have no discipline when it comes to sex, food, ethics or anything else."

S. writes: "As an Army recruiter, I can tell you first-hand that this is the truth. Between the physical issues, overweight, asthma, et cetera, education issues, lack of a high school diploma, inability to pass the Armed Services Vocational Aptitude Battery exam and moral issues, criminal charges, drug use, et cetera, we have a tough time finding qualified applicants. We're in trouble."

Stoo writes: "Quite simply, we need mandatory service for all citizens like any country under the constant threat of their adversaries. Our nation and the society cannot afford the luxury of inactivity."

Sergeant Dave writes: "That's all right. The drill sergeants have got something to fix it. They are very happy to give the chubbiest ones some extra help."

Gary writes: "My experience in the military was that the rigorous physical training of boot camp, turned a kid, not unlike kids today, into a pretty fit fighting machine. And I had a lot of pride and respect for myself at what I accomplished in a short period of time."

Don in Las Vegas says: "I would have preferred for President Obama to stop the wars himself, but this is OK too. Nature works in mysterious ways."

And Michael in Washington: "Maybe if the military establishment would invent a weapon or device a means of combat that included text messaging or tweeting, we'd have nothing then to worry about. Or a better solution might be to encourage American fast food chains to open locations all over the world. Eventually, every nation's potential soldiers would be unfit."

If you want to read more on this, you'll find it on my blog, CNN.com/CaffertyFile.

Jessica, that's all I got.

YELLIN: All right. Jack, thanks. Good to see you.

It is a record breaking plunge that you can take if you're brave enough. CNN's Jeanne Moos takes a most unusual look at the sky jump.

(COMMERCIAL BREAK)

YELLIN: Here's a look at "Hot Shots" coming in from our friends at the "Associated Press.'

In Bosnia, a police officer wearing riot gear confronts a protestor upset about cuts to the Bosnian war veteran benefits.

In Frankfort, Germany, activists stage a demonstration against the global financial system.

In India, a boy cools off during a heat wave.

And in northern Germany, a rare white tiger cub poses for a snapshot. Last month, he was one of two tigers named Rico and Kico born at that zoo.

That's "Hot Shot" -- pictures worth a thousand words.

Well, taking the plunge in Las Vegas used to mean getting married. Now, it also means a 108-story controlled free fall.

CNN's Jeanne Moos takes a most unusual look.

(BEGIN VIDEOTAPE)

JEANNE MOOS, CNN CORRESPONDENT (voice-over): If you jumped -- jumped from a height of 108 stories.

Your face would tell a story, too.

She was one of the first to try the SkyJump Las Vegas at the Stratosphere Hotel. Guinness proclaimed it the highest commercial decelerator in the world -- guide wires make it basically a controlled free fall at around 40 miles an hour.

Local reporters, like KTNV's Tina Patel lived to tell.

TINA PATEL, KNTV REPORTER: Yes, that's me taking the plunge.

MOOS (on camera): You'll notice it's not me. The only plunge I'm taking is in an elevator to my office.

(voice-over): Unlike me, Tina landed on her knees.

PATEL: Everybody told me it was that letting go that was going to be the hardest part, and it was.

MOOS: Sky jumpers have to suit up and get weighed before they jump. Those over 275 pounds need not apply -- probably the biggest danger is a pinched private.

At 829 feet, SkyJump Las Vegas beats out the Macau Tower sky jump in China.

This kid was pretty fearless.

Many jumpers refused to let go.

UNIDENTIFIED FEMALE: I'm scared. Give me two seconds.

MOOS (on camera): At least they saved 100 bucks by being a coward. That's how much the new sky jump costs.

(voice-over): Though the hotel is called the Stratosphere, there will be an attempt to jump from the actual stratosphere, from a balloon 23 miles up later this year, trying to break the old record of 20 miles. Felix Baumgartner will be wearing a space suit.

Talk about putting the fear in stratosphere --

UNIDENTIFIED FEMALE: Oh, God.

MOOS: -- a cast member from the "Elvis Duran" radio show ended up wearing a chicken shirt. He was supposed to jump but ended up in tears -- so an assistant took his place.

UNIDENTIFIED MALE: Two, one -- go.

MOOS: Eight hundred and twenty-nine feet -- it's no wonder they get cold feet.

Jeanne Moos --

UNIDENTIFIED MALE: Oh, God! Oh, God!

MOOS: -- CNN --

UNIDENTIFIED FEMALE: Sweet!

MOOS: -- New York.

(END VIDEOTAPE)

YELLIN: That looks terrifying.

I'm Jessica Yellin in THE SITUATION ROOM.

"JOHN KING, USA" starts right now.