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THE SITUATION ROOM

Interview With Senior White House Adviser David Axelrod; No Jobless Benefits & No Home; Interview With Incoming Majority Leader Eric Cantor

Aired November 30, 2010 - 17:00   ET

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


SUNNY HOSTIN, CNN LEGAL ANALYST: And so is he making it up or not?

BROOKE BALDWIN, CNN ANCHOR: Perhaps one of the reasons why we're questioning the veracity of the seizure is because he was also singing in court. So people aren't entirely sure about...

HOSTIN: Daily.

BALDWIN: -- about this guy.

All right, Sunny Hostin on the case.

Thank you so much.

And with that, I'm going to turn things over to my colleague, Wolf Blitzer, in THE SITUATION ROOM -- Wolf.

WOLF BLITZER, CNN ANCHOR: Thanks very much, Brooke.

Happening now, President Obama's rare admission to Republican leaders -- we'll go behind the scenes of the White House meeting. And I'll ask David Axelrod and Republican Congressman Eric Cantor what, if anything, was really accomplished.

Also, we're getting new information about the health of two powerful leaders of dangerous nations. More secrets are being revealed from the leak of U.S. diplomatic documents.

And a new survey reveals what U.S. troops really think about allowing gays to serve openly in the United States military. Now the Pentagon is giving a green light to repealing "don't ask/don't tell."

I'm Wolf Blitzer.

You're in THE SITUATION ROOM.

Exactly four weeks after Democrats got pounded on election day, President Obama finally met with the leaders of both parties and warned they can't afford to play partisan games any longer. Republicans say the White House summit was productive and they did manage to get something out of their host.

Let's go straight to our White House correspondent, Dan Lothian -- Dan, did this go the way the president had hoped it would go?

DAN LOTHIAN, CNN WHITE HOUSE CORRESPONDENT: Well, the president does believe that it was productive. But it was hardly what he had envisioned when he first announced this summit. It was only two hours, not a lengthy event. It did not end with a dinner. There was no camera -- there were no cameras inside to capture what was going on there. Some might see it as just political theater, but the wheels have been put in motion. And the president did make one big admission -- that he'd made a mistake.

(BEGIN VIDEOTAPE)

LOTHIAN (voice-over): As President Obama strolled back to the West Wing reading his BlackBerry, a top aide confirmed what Republican leaders fresh out of the meeting were already telling reporters.

REP. ERIC CANTOR (R-VA), INCOMING MAJORITY LEADER: I was encouraged by the president's remarks regarding his perhaps not having reached out enough to us.

REP. JOHN BOEHNER (R-OH), SPEAKER OF THE HOUSE: They hadn't spent as much time with us, reaching out and talking to us, and committed to do so.

LOTHIAN (on camera): Did he offer an apology at all?

ROBERT GIBBS, WHITE HOUSE PRESS SECRETARY: No. He said that he took responsibility for that. And, as I said, in order to have bipartisanship, we have to do this both ways. And the president's -- the president's ready to do his part.

LOTHIAN (voice-over): Beyond this mea culpa, extending the Bush era tax cuts dominated the meeting. Both sides struck an optimistic tone, agreed that it needed to get done this year, but didn't back away from their entrenched views.

SEN. MITCH MCCONNELL (R-KY), MINORITY LEADER: We ought to treat all taxpayers the same.

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: And here we disagree. I continue to believe that it would be unwise and unfair.

LOTHIAN: To bridge this wide divide, President Obama has tapped Treasury secretary, Timothy Geithner, and budget director, Jack Lew, to work with Congressional representatives from both parties to find a compromise.

OBAMA: That process is beginning right away. And we expect to get some answers back over the next couple of days.

LOTHIAN: The president's agenda for the lame duck session is ambitious. He also wants to extend unemployment benefits, get the new START Treaty ratified and a repeal of the military's "don't ask/don't tell" policy.

But Republicans, while signaling they're ready to find common ground, are insisting on a more measured approach.

MCCONNELL: Let's take care of the tax issue.

Let's take care of how we're going to fund the government for the next 10 months.

(END VIDEO TAPE)

LOTHIAN: And Senator McConnell says that if there's time after that, then the leadership can decide whether they should take up some of these other issues. What's interesting, though, is that Robert Gibbs told reporters that he believes that the president can, indeed, tackle his entire agenda by the end of the year. And to that, one reporter replied, good luck -- Wolf.

BLITZER: Good luck, indeed.

We also hear, Dan, that, at one point, the president asked his senior staff members, who were in the meeting, to simply walk out so he could discuss privately with the Congressional leaders something.

Tell us what we know about that.

LOTHIAN: That's right. And, you know, we asked Robert Gibbs whether this has happened before. And he said that he doesn't recall that it's happened in a bipartisan meeting. And I asked him, why did the president ask these officials to leave, was it because he no longer needed them?

And he said it was because he wanted a more intimate session to talk with these lawmakers face-to-face.

And I should point out, the president wants to have more meetings like this in the future, including a summit at Camp David.

BLITZER: Well, let's see if that works out.

Dan, thank you.

President Obama is praising a new Pentagon report that reinforces his goal of ending the ban on gays serving openly in the United States military. The survey reveals that over two-thirds of service members do not object to gay and lesbian troops serving openly. In a just released statement the president said -- and I'm quoting now: "Today, I call on the Senate to act as soon as possible so I can sign this repeal into law this year and ensure that Americans who are willing to risk their lives for their country are treated fairly and equally."

The Defense secretary, Robert Gates, also urged Congress to lift the ban, saying there would not be much risk to military readiness.

(BEGIN VIDEO CLIP)

ROBERT GATES, SECRETARY OF DEFENSE: I am determined to see that if the law is repealed, that the changes are implemented in such a way as to minimize any negative impact on the morale, cohesion and effectiveness of combat units that are deployed and about to deploy to the front lines.

(END VIDEO CLIP)

BLITZER: Just ahead, I'll speak with White House senior adviser, David Axelrod, and I'll ask him how far President Obama is willing to go to repeal "don't ask/don't tell." Stand by for the interview.

Also this hour, new revelations are emerging from the leak of secret U.S. diplomatic communications. According to a 2009 cable posted by WikiLeaks, Kuwait's interior minister suggested detainees at Guantanamo Bay should be left to die in the Afghanistan war zone. And "The New York Times" is reporting that the U.S. ambassador to Pakistan sent a secret message last year, suggesting she was worried the country's nuclear materials would fall into the hands of militants.

We're also getting new information about the health of two powerful leaders in countries former President Bush once called the axis of evil.

Brian Todd is looking into that.

Brian is here -- let's start, Brian, with Iran, first of all.

What are we learning on that?

BRIAN TODD, CNN CORRESPONDENT: Some pretty extraordinary cables on Iran, Wolf.

This is last year. Americans in the U.S. consulate in Istanbul cabled that a businessman told them he had heard that the top ayatollah, Ali Khameini, has cancer. The cable said this, quote -- the name deleted. This is a friend of the businessman, actually, claimed: "Rafsanjani" -- the former president, told him: "Supreme Leader Khameini has terminal leukemia and is expected to die in months."

The information was third hand from a friend of Hashemi Rafsanjani, the former president, who is also one of Ayatollah Khameini's top rivals.

If there was a new supreme ayatollah in Iran, it could have an impact on the nuclear program there; it also could have an impact on the future of President Mahmoud Ahmadinejad.

But, again, that cable was more than a year ago. And just last week, Ayatollah Ali Khameini made a public appearance -- Wolf.

BLITZER: What about the North Korean leader, Kim Jong-il?

As you know, there was a report two years ago he had a stroke.

TODD: Right.

BLITZER: But we've seen him in public since then.

TODD: We have. And that's a topic of a lot of uncertainty, as well. In the cables, that comes out. One cable last year says that, quote: "South Korean analysts believe that Kim Jong-il was unlikely to live more than three to five years, although he seemed to be doing better lately."

But another cable a year ago said a Chinese diplomat who met with Kim said he had lost weight but, quote, "appeared to be in reasonably good health and still had a sharp mind."

"The North Korean dictator confirmed that he can still drink alcohol," according to this cable, Wolf. That's a very important component for Kim Jong-il, to do that.

BLITZER: Right. It's one thing, his health.

What about the health of the regime in North Korea, because there's been a lot of suggestions it, at some point, could simply collapse?

TODD: That's right. And what's key here is how China will react to that. And there's an extraordinary cable about China's reaction to that. One cable reported that a Chinese vice foreign minister predicted that the government in Pyongyang would collapse politically two to three years after the death of Kim Jong-il. And in a surprising statement -- pretty extraordinary here when you realize this -- the Chinese official said if North Korea collapsed, quote: "The PRC" -- that's the People's Republic of China -- "would be comfortable with a reunified Korea controlled by Seoul and anchored to the United States" in a, quote, "benign alliance" as long as Korea was not hostile toward China.

He stipulated there should be no American troops in what's now North Korea, north of that demilitarized zone. And other Chinese officials are less conciliatory about the prospect of a unified Korea.

But when a top official in Co -- in China says we could be OK with a unified Korea controlled by what is now South Korea, right on its borders, extraordinary there.

BLITZER: I mean the information -- the wealth of information in these cables is amazing.

TODD: Right.

BLITZER: And we're only the tip -- getting the tip of the iceberg here.

TODD: And backpedaling all over the world.

BLITZER: There's a lot of stuff going on.

Thanks very much, Brian.

We have much more on this story coming up later.

Meanwhile, the list of potential presidential candidates keeps growing. At least a dozen Republicans expressing some interest so far.

Jack Cafferty is looking ahead to the election.

He's joining us now with "The Cafferty File" -- Jack.

JACK CAFFERTY, CNN ANCHOR: Forget all the talk about the United States electing an African-American or a woman as president, how about a fat guy -- or a fat woman?

Besides William Howard Taft -- we're talking about the modern era here.

This idea comes to us courtesy of a terrific column in "The Daily Beast" by Lloyd Grove. He talks about the proliferation of "tough, smart and decidedly chubby Republican contenders," people like New Jersey governor, Chris Christie; Mississippi governor, Haley Barbour; along with former House speaker, Newt Gingrich; and former Arkansas governor, Mike Huckabee. And Grove writers that the rise of these politicians could mean the imperially slim presidential stereotype might be losing political currency.

Experts suggest that in the past, Americans have seen their presidential candidates as lean, mean, fighting machines. And they point out that there are plenty of studies that show that people pick the best looking candidates when they don't know a lot else about them.

But in light of the staggering problems this country is facing, maybe it's time for a new approach.

When Chris Christie ran for governor of New Jersey, it was his opponent who made fun of his weight -- made it an issue. Democrat Jon Corzine ran a TV ad accusing Christie of "throwing his weight around." But in the end, it backfired. Christie said Corzine ought to man up and say I'm fat. Christie won the election.

As for Haley Barbour, he jokes about his extra pounds saying stuff like, "I don't sweat much for a fat boy." A Barbour spokesman says at some point, people have to decide whether they're electing the candidate most qualified to lead the country or if the election is a beauty pageant.

It's certainly something to chew on.

Here's the question -- can a fat man or, for that matter, a fat woman be elected president?

Go to CNN.com/caffertyfile.

BLITZER: And read the e-mail.

Jack, thanks very, very much.

A top Republican says the White House isn't doing enough to prevent damaging leaks of diplomatic secrets. I'll ask the White House senior adviser, David Axelrod, about that and much more. He's standing by live.

And CNN is on board for U.S. war games off the volatile Korean Peninsula. You're about to see for yourself if the exercises could provoke a real war.

(COMMERCIAL BREAK)

BLITZER: At the White House right now, President Obama is juggling serious threats to U.S. diplomacy and serious threats to his political agenda right here at home, as Republicans prepare to take control of the House of Representatives.

We're joined now by the president's senior adviser, David Axelrod.

David, thanks very much for coming in.

DAVID AXELROD, SENIOR WHITE HOUSE ADVISER: Hey, Wolf, good to be here.

BLITZER: All right. I want to get to the meeting today. But I want to first talk a little bit about this WikiLeaks document dump.

Peter King, who is the incoming chairman of the House Homeland Security Committee, I spoke with him today. And he really blasted the Obama administration's handling of this crisis.

Listen to what he told me.

(BEGIN VIDEO CLIP)

REP. PETER KING (R-NY), HOMELAND SECURITY COMMITTEE: I have no evidence that the administration is doing anything. I mean they've known for months and months and months what WikiLeaks is up to. And yesterday, Eric Holder certainly didn't -- I didn't sense any note of anxiety, any -- any intensity. He's saying, you know, they're looking into it, they're exploring, they're -- but no -- no real evidence they're doing anything serious as far as going after WikiLeaks.

(END VIDEO CLIP)

BLITZER: All right, I want to give you a chance to respond.

What are you doing about this?

AXELROD: Well, look, obviously the WikiLeaks document dump was a terrible breach and, you know, if we can't conduct our diplomatic business without classified and secret documents being trafficked on the Internet, it's extraordinarily crippling to our efforts, and we are taking every step that we can possibly take to not only to go backwards but to go forwards and make sure that that never happens again.

And if Representative King doesn't believe that we have a sense of urgency about that, then he hasn't spoken to the people that I've spoken to in the building behind me and around this government in the last -- in the last five days.

BLITZER: He wants the president to declare that WikiLeaks is a foreign terrorist organization and should be treated accordingly, I guess sort of like al Qaeda.

Is that something that you're considering?

AXELROD: You know, I'm not going to get into that, Wolf. Obviously, we want to take every step to make sure not just that people don't put our -- put documents that are secret and classified on the internet but that they don't have access to them. And that's the most important thing, is to make sure that that flow does not happen ever again.

BLITZER: Let's talk about the president's meeting with the Congressional Leadership today.

He hinted broadly, the president, that he's now ready to work out some sort of compromise with the Republican leadership on the Bush-era tax cuts. Are you willing to see all those tax rates remain the same for the next two years?

AXELROD: Wolf, as you know, what the president has said is that he supports a permanent tax cut for the middle class. The middle class have born the bankrupt of this recession, seen 5 percent decline in incomes over the last 10 years. It's absolutely essential that their taxes not go up as of January 1st. Of course, that's 98 percent of American taxpayers.

As for the other 2 percent, you know, the mostly millionaires and billionaires, it would cost another $700 billion in the next ten years alone to give them the permanent tax increase that our friends on the Republican side want to give them, and the president believes strongly that that's just fiscally irresponsible, that we can't do it.

Those are his parameters as he said in the room today. You know, with that in mind, he's willing to sit down and talk.

He designated Secretary Geithner, secretary of treasury, and Jack Lew, our new budget director, to sit down with representatives from both chambers in the next few days and try and work these issues through, and I'm not going to commence those negotiations here with you.

BLITZER: Which is understandable, I don't blame you.

Let's talk about "Don't Ask, Don't Tell." If it doesn't pass, repealing this "Don't Ask, Don't Tell" law, if it doesn't pass in the U.S. Congress before the end of the year, is the president ready to find a way to sign an executive order doing to the U.S. military what Harry Truman did after World War II in desegregating the U.S. military, simply signing a law, an executive order into effect saying it's over, gays can serve openly in the United States military?

AXELROD: Well, first of all, let me say three things. The president has made clear that he is intent on ending this policy. He feels it's bad for our national security. It's not consistent with who we are, it's unfair, we're depriving patriotic young Americans of their right to serve, and we're depriving our military of their services.

And obviously, Secretary Gates and Admiral Mullen strongly agree, as they said today. And as we now know from the report that was released, the vast majority of people who served today share that -- share a similar -- a similar view.

Now, this was -- "Don't Ask, Don't Tell" was an act of Congress, and so we need Congress to act to repeal what they've done. We think the support is there if we can break through a filibuster in the Senate. We're hopeful --

BLITZER: But is there anything --

AXELROD: We're hopeful that we can do that between now and the end of the year. And I'm not going to prejudge our ability to do that, we continue to work hard to get that done.

BLITZER: But theoretically, is there a procedure the president could use if Congress fails to repeal "Don't Ask, Don't Tell"? Have you thought of another option in terms of an executive order? Is that at least on the books?

AXELROD: Look, I mean, we're exploring all options. The most orderly way to approach this would be for Congress to repeal its action.

The votes are there to do it. There are procedural blockades against it right now, we'd like to see those fall and we'd like to get it done. There are also important cases winding through the courts; one court has ruled it unconstitutional.

So there's a lot of things going on right now, all of them point to an end to this policy and this policy is going to end.

BLITZER: David Axelrod, getting ready to move back to Chicago at some point to work on the president's reelection campaign, thanks very much for coming in.

AXELROD: Great to be with you, Wolf, thank you.

BLITZER: David Axelrod is the president's senior adviser.

Just how much are Republicans willing to compromise with the White House? Ahead, the incoming House majority leader, Eric Cantor, will share his account of that bipartisan meeting at the White House with President Obama.

Plus, she's a college-educated, former museum curator. Now she's homeless and her unemployment benefits have run out. You'll meet her, stand by.

(COMMERCIAL BREAK) BLITZER: This is the last day for jobless Americans to file for extended unemployment insurance before the benefits end tomorrow. Two million people are expected to stop receiving checks in the coming weeks unless Congress takes immediate action, but lawmakers are not expected to extend the deadline soon, if the all.

Our Mary Snow has been talking to jobless workers about losing their benefits and losing their way of life -- Mary.

MARY SNOW, CNN CORRESPONDENT: Well, we've been talking to 99ers, that's a term used for people who have exhausted the limit of 99 weeks of unemployment benefits.

The woman you're about to meet thought at this stage in her life she'd be successful in her second career. Instead, she's struggling to stay off the street.

(BEGIN VIDEOTAPE)

SNOW (voice-over): To look at 50-year-old Deborah Saville, you wouldn't know she's homeless. Yes, she has some sporadic work, but she's among the millions of Americans who are jobless and whose unemployment benefits have run out.

DEBORAH SAVILLE, OUT OF WORK SINCE 2007: Right before my eyes, you know, just like, everything, yes, falling apart and also sort of, you know, my zest for life and -- I don't know. Like, you know -- like a future.

SNOW: Deborah envisioned her future in museums. She was working as an assistant curator at the Brooklyn Museum in 2007 when she lost her job. Then, she got evicted. These days she's staying with whoever will take her in, including shelters. Now she's sleeping on the floor in this artist loft, but needs to be out before Christmas.

Deborah tells us every day is a strategy of survival.

SAVILLE: So, you know, I've had to make choices where I get, like, a small, you know -- a small amount of money to put on my phone, you know, because it's just a prepaid cell phone. And then put a little bit of gas in my car and then make a little more money.

SNOW: While she searches for work, she's also applied for a grant to a master's program in social work, her original career, and in the meantime, takes odd jobs.

Her situation has driven her to meetings like this one for 99ers, a term for people who have exhausted the 99-week limit on unemployment benefits. Kian Fredrick organizer in what's become part political action, part support group.

KIAN FREDRICK, 99ER ORGANIZATION: To say you're lazy, go get a job, you've got your 99 weeks. Where are the jobs? 99ers want to work.

PROTESTORS (chanting): We need a J-O-B, so we can E-A-T. SNOW: 99ers have also staged rallies, pressing Congress to extend what is already an unprecedented amount of benefits. But opponents say, if there's an extension, there needs to be spending cuts.

After losing benefits seven months ago, Deborah isn't holding out hope for more government help and braces herself for the possibility of living in her car.

SAVILLE: I don't know where I'm going to end up, you know? I mean, I need my car. I can't be potentially homeless and without -- without something that allows me to do what I need to do.

(END VIDEOTAPE)

SNOW: Now, while Deborah is trying to line up a place to live in the coming weeks, her mother is now helping her pay the car insurance to keep her car on the road -- Wolf.

BLITZER: Mary Snow, thanks very much for that report.

Many Republicans say -- some Democrats, as well, by the way -- that there's good reason to cut off unemployment benefits at 99 weeks. I'll ask the number two House Republican, Eric Cantor, about that, the meeting at the White House today, a lot more. You see him there, he's standing by live.

And the Senate uses some of its final days in session to try to make food safer.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: The American people did not vote for gridlock. They didn't vote for unyielding partisanship. They're demanding cooperation and they're demanding progress, and they'll hold all of us -- and I mean all of us -- accountable for it. And I was very encouraged by the fact that there was broad recognition of that fact in the room.

(END VIDEO CLIP)

BLITZER: President Obama talking about his long-awaited summit meeting today with congressional leaders at the White House, including Republicans set to take control of the House of Representatives.

Joining us now, someone who was inside the room at the meeting, the number two House Republican, the incoming majority leader, Eric Cantor of Virginia.

Congressman, thanks very much for joining us.

REP. ERIC CANTOR (R-VA), INCOMING MAJORITY LEADER: Wolf, good to be with you.

BLITZER: The president says it was a good meeting. Tell us what was so good about it. Take us inside.

CANTOR: Wolf, I do think it was a good meeting. I think perhaps it might be a positive start after what I believe is a historic election.

There was recognition on both sides that what the people of this country want is to see Washington to begin working for the public again and to produce results.

And we do have, as Republicans, a golden opportunity to sort of reset the direction in which we're heading and make it towards one of opportunity, responsibility, and success. So I'm encouraged.

BLITZER: What was the most encouraging thing you heard from the president today?

CANTOR: Well, Wolf, where most people, I believe, are is they want to see the economy start again, so that more people can get back to work. And what we've always said is that no one should suffer a tax hike right now while we have near 10 percent unemployment.

And what I heard today from the president was a recognition that this is a tough economy and that we have now, at his request, put in place a process which perhaps we can see a way forward to ensure that no one gets a tax increase this year.

BLITZER: Are you ready to compromise on that issue, allow all the Bush-era tax rates to continue, including for the wealthy, for let's say two years?

CANTOR: You know, Wolf, there's been no negotiation as far as offers being put on the table, so I don't want to sit here and negotiate against no one.

But I would say that what came out of the meeting today was an indication, at least from what I took from the meeting, that this president and his team want to work with us.

The president admitted that perhaps he wasn't as forthright in terms of wanting to reach out to us over the last two years and that maybe we can begin anew and really deliver some results for the American people. First and foremost, let's get the uncertainty out of the way as far as these tax rates are concerned so people can get back to work.

BLITZER: Now you want to go back -- you want to cut government spending, reduce the size of government. You want to go back to the spending levels of 2008, is that right?

CANTOR: It is true. And yesterday, just yesterday, the president himself took one of our ideas that we have talked about since last May, and that is to begin to reduce the size of the federal bureaucracy by freezing pay to federal workers. We all know that the pay scales in the federal government far exceed those of the private sector. We -- and I think that that is something that we were looking for. As this president said, yes, I will join you in trying to cut the spending and the deficit in this town.

So we all have to work together. And when you see a Republican majority come January, it is our intention to try and bring down discretionary spending to '08 levels and that will produce the saving of $100 billion alone in the first year to taxpayers.

BLITZER: So you're not including the Defense Department.

CANTOR: In my opinion, Wolf, everything should be on the table. I don't think you can --

BLITZER: If you go back to the 2008 Defense Department spending, that's about $100 billion less than what the Defense Department is currently spending.

CANTOR: I don't think, Wolf, that anyone can defend every dollar and cent that the Pentagon is spending. We're going to have to prioritize.

Make no mistake about it, a Republican majority is going to be a pro-Defense and strong national security majority, but we're also very concerned about doing more with less, and I think because of that everything will be on the table.

BLITZER: What do you say to those 2 million Americans who are about to lose their unemployment benefits after 99 weeks and they're about to go cold turkey, if you will, they're not going to get any more help?

CANTOR: You know, Republicans have never been opposed to giving more help to those who need it. We believe in a safety net for those who need it. We do not, however, support the continued extension of benefits without having some ability to pay for them.

You know, this goes back to sort of what I believe was message out of the November 2nd election, Wolf, and that is we've got to stop spending money we don't have.

So we have proposed again and again, as Republicans, ways to pay for benefits to those who need them without some trickery in budgeting, but to actually to begin to prioritize. And if we're going to help those in need of help, we've got to pay for it.

BLITZER: The gays serving openly in the U.S. military, it's an important issue. Today, the Pentagon, the chairman f the Joint Chiefs, the Defense secretary said they can do it without serious problems in terms of military morale, cohesiveness, unity. The American people seem to agree. If you look at the polls, look at the survey of active duty military personnel, as well.

Are you ready to pass legislation that will repeal the "Don't Ask, Don't Tell" policy?

CANTOR: You know, Wolf, the three things that matter to me, and that is readiness, retention, and recruitment as far as our armed services are concerned. And I, for one, need to take a look at the study which is underway or been produced at the Pentagon to see what kind of impact that a policy like that really has on those three things.

But let's look at the broader picture right now. This election that we've just gone to in this country was very much about people's economic situation and the fact that they want us to put a priority on the economy and getting people back to work, and that is having the environment which more jobs can be created in the private sector. That's what the focus of the meeting of the White House was today. It was all about jobs and the economy first.

And hopefully, that's how we can end the year, is taking care of what I believe is one of the biggest uncertainties facing the economy right now, which is the possible tax hikes that everyone is facing come January 1 if we don't act.

BLITZER: We're out of time, but do I hear you're saying you have an open mind on this issue, "Don't Ask, Don't Tell"?

CANTOR: Wolf, this has always been a question of how that policy will impact recruitment, readiness, and retention as far as our armed services are concerned, and not having had the opportunity to look at that study to determine the impact of "Don't Ask, Don't Tell" on those three items, I'm not ready to tell you that, yes, we would take a look at it or not. Again, this has to do with our national security.

BLITZER: All right. I'll take that as a yes -- I have an open mind, I want to do some more studying on that -- and we'll leave it at that.

Congressman, congratulations once again on your victory. Good luck in the leadership votes.

CANTOR: Thank you.

BLITZER: Eric Cantor, Republican of Virginia.

There is a new warning that too much of a certain vitamin can actually be hazardous to your health. Police say a drunken passenger could have done some serious damage to a cruise ship. We'll explain. That and a lot more coming up.

(COMMERCIAL BREAK)

BLITZER: Kate Bolduan is monitoring some of the other top stories in THE SITUATION ROOM right now, including a stalled effort on Capitol Hill to end what critics call wasteful spending. What do we know?

KATE BOLDUAN, CNN CORRESPONDENT: Wolf, it's those earmarks. The Senate has voted against taking up a measure that would have imposed a two-year ban on legislative earmarks. Supporters hoped the moratorium would end pet projects that lawmakers insert into bills typically for spending in their home state. Senate Republicans voted to forgo earmarks but that ban was voluntary.

Meanwhile, one of the Senate's most powerful figures bids farewell amidst a standing ovation. In his final speech on the Senate floor, outgoing Connecticut Democrat Chris Dodd reflected on his more than three decades in Congress and defined for his colleagues the meaning of success.

SEN. CHRIS DODD (D), CONNECTICUT: We always determine whether he fulfilled the framers' highest hopes or justify the cynics' worst fears is not the Senate rules or the calendar or the meeting. It is whether each of the 100 senators can work together, living up to the incredible honor that comes with the title and the awesome responsibility that comes with this office.

BOLDUAN: Dodd, who chairs the prominent Senate banking committee, helped spearhead the landmark financial and health care reform bills. Good career for him.

The country's food supply could soon be safer. The Senate has just approved a measure which will empower the food and drug administration to better manage situations like recent recalls of lettuce, peanut, and eggs. Those recalls were associated with hundreds of reported illnesses. The house passed a version of the food safety enhancement act last year.

And vitamin D and calcium aren't always the keys to good health. This was pretty interesting. Too much can be detrimental. The institute of medicine recommends most Americans up to age 70 need no more than 600 international units of vitamin per d and anywhere from 700 to 1,300 milligrams of calcium a day. Helpful sources of both include oily fish, milk, egg, and egg yolks.

This one is one of those stories that has everyone's heads scratching a little bit. A cruise ship passenger believed to be intoxicated -- that won't surprise you -- has been arrested for allegedly releasing the boat's anchor. According to an affidavit obtained by the smoking gun website, the Holland America cruise ship traveling from Mexico to Florida was not harmed in the Saturday incident, but the report says it could have sustained significant damage. How on earth, Wolf, is that guy going to try to explain that one? Had a couple beers and came up on this anchor. I mean --

BLITZER: Can anybody just -- I've never been on a cruise, but can anybody just go and release an anchor? I would think there would be some security precautions.

BOLDUAN: I agree, and I imagine that they're quite large. I don't know.

BLITZER: You obviously haven't done a lot of voyages either.

BOLDUAN: Exactly. You and I, we're not the cruising type, I guess.

BLITZER: No. Thanks. We'll talk later. As tensions rise between north and South Korea, CNN gets a front- row seat on the "USS George Washington" for military exercises that could help prevent a future attack.

Plus, Russia's president warns the west a new arms race could be ahead.

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BLITZER: Diplomatic efforts to calm some bitter tensions right now between the Koreas are building in the wake of North Korea's deadly artillery shelling on a South Korean island. CNN's Stan Grant is on board the "USS George Washington," the aircraft carrier where joint military exercises between the United States and South Korea could prevent further attacks.

(BEGIN VIDEOTAPE)

STAN GRANT, CNN CORRESPONDENT: CNN invited on to the "USS George Washington" in the hotly contested yellow sea. On board, a flurry of activity, 6,000 troops working around the clock, keeping the carrier group on alert and jet fighters in the sky. One by one, these jet fighters are coming in to land on the "USS George Washington." There are about 75 of them. Just behind me here, you can see another one coming in. What we're seeing is a real display of the firepower of the U.S. and South Korea at its disposal. These exercises have been long planned. Defensive drills and for major leagues mainly, no live fire. But they have taken on greater significance since North Korea's attack last week on the south's island, killing two military and two civilians, forcing residents to flee. Now the man in charge of the whole exercise, Admiral Dan Cloyd, telling CNN this stands as a deterrent to any future aggression.

ADM. DAN CLOYD, COMMANDER, USS GEORGE WASHINGTON: We're here to reaffirm our commitment to our republic of Korea allies, to demonstrate collective security and certainly the deterrent effect that we hope we're having against North Korea is -- we're always mindful of that.

GRANT: As the ally of South Korea, the president yesterday said he's run out of patience and tolerance with North Korea. Another act of aggression, another act of provocation, South Korea will stand back hard. Do you stand ready to support them in that?

CLOYD: Certainly what decisions the government and republic of Korea makes would be inappropriate for me to speculate or comment on. But our mission will be to continue to train the republic Korean navy and the air force as part of this exercise as well.

GRANT: Six warships have joined the U.S. in these drills. The George Washington's captain say these exercises underline how vital their service is.

CAPT. DAVID A. LAUSMAN, COMMANDING OFFICER, USS GEORGE WASHINGTON: We're honored to be working with the republic of Korea navy. The coalition has been strong for decades, almost my entire military career.

GRANT: But North Korea has declared these drills a pretext for war, warning any incursion will spark military action. The exercise at least 100 kilometers, 60 miles from the disputed border. Inside the ship, radar keeps a close eye on Pyongyang. For four days sea and air drills are drawing to a close, all the while diplomacy being stepped up to try to calm the waters off the Korean coast. Envoys from the U.S., Japan, and South Korea will meet in December to discuss the north. China holding talks in Beijing with an official from its close ally Pyongyang, and on the Yellow Sea, a display of what the military can do if needed, if talks fail.

Stan Grant, CNN, on the "USS George Washington", Yellow Sea.

(END VIDEOTAPE)

BLITZER: The former president Jimmy Carter says he is distressed with the heightened tensions between the two Koreas and he described how the long talks with North Koreans during a recent visit.

JIMMY CARTER, FORMER PRESIDENT OF THE UNITED STATES: I hope they will communicate easily be America, and work out a way to do away with that nuclear program, and have a permanent peace agreement. As you know the one we have now for more than 50 years is a temporary cease- fire and I believe that North Koreans really wants to see the sanctions end, and maybe be more responsible in the international community. I hope so.

BLITZER: Ominous new warnings from Russian leaders about a new arms race with the United States.

And we will take a closer look at the young army intelligence analyst who is suspected of leaking hundreds of thousands of sensitive documents.

(COMMERCIAL BREAK)

BLITZER: The Russian president Dimitri Medvedev is warning there could be a new arms race between Russia and the west if missile defense talks that started at a recent NATO summit breakdown. The Russian prime minister and former president Vladimir Putin meanwhile addressed the concerns with CNN's Larry King in an exclusive interview.

VLADIMIR PUTIN, RUSSIAN PRIME MINISTER (through translator): If our proposals will be met with negative answers only, and on top of that, at the borders, there will be built additional threats as the new version of the third defense region there. Russia will have to ensure her own security through different means and ways.

BLITZER: You can see the full interview with Putin tomorrow night on "LARRY KING LIVE" airing at 9:00 p.m. eastern only here on CNN. Good guest for Larry King.

Jack Cafferty is asking, can a fat man can be elected the president of the United States? Jack is standing by with your e-mail. That is coming up.

Also, you will find out what the founder of Wikileaks says should happen to Secretary of State Hillary Clinton in the wake of some of those embarrassing diplomatic documents that have been now released. The details ahead.

(COMMERCIAL BREAK)

BLITZER: Let's get right to Jack for "The Cafferty File" -- Jack?

CAFFERTY: The question this hour is: Can a fat man or for that matter a fat woman ever be elected the president of the USA?

Will writes from Rochester, New York, "Sadly, the trend toward taller, slimmer and better looking candidates is no novelty. You cannot read the paper, watch TV or go on the internet without being inundated with images of beautiful people, and politics is not immune to that trend. How else would Sarah Palin have any hope of a career in politics? Count your blessings, Jack. Without your striking good looks, think of where you would have ended up." That's a good point.

Eric writes: "I certainly hope not. If our nation cannot come up with one person who is highly qualified to lead and who cares about fitness, then we ought to give up and ask the British to take the colonies back. More practically, electing someone whose physique predisposing them to heart trouble to the highest and most stressful office in our government guarantees a heart attack. If you don't believe me, take a look at Dick Cheney."

Fred writes: "Honestly, Jack, fat people don't get taken seriously. Being fat is the new thing that's OK to ridicule. And in the political arena, it will be super easy to pick apart a Republican candidate who's overweight. His opponents will just start using the words pork and fat cat all over the place and it will drive the point home. I'm fat. I see it everyday."

Eve in Texas: "Certainly but not a fat woman."

Sid writes: "If a person does not have the resolve to maintain their own health, why would I trust them with the health of my country?"

Gina in Tennessee: "Living in one of the states with higher obesity rates and having a weight problem myself, I am personally tired of being treated as if I have a smaller IQ than a thin person. Overweight people can be just as smart as thin people. When will people see past this?"

Sid writes: "I say, Jack, let's get a fat black-Jewish woman in there and she can fix what ails us."

Jose writes: "Fat chance."

Joseph in Austin writes: "When you look at the current candidates, why not? Fat is better than stupid any day as long as their hair is nice."

Craig in Arizona: "Leno and Lettermen would have a field day. It's a heavy question to ask in this age of political correctness, but I'll weigh. Given the field of potential candidates in 2012, either Chris Christie or Haley Barbour would tip the scale in favor of candidness. These heavy hitters are the kind - are the kind of people we need in Washington to cut out the fat in Washington." That's just awful.

If you want to read more, you'll find it on the blog, cnn.com/caffertyfile.

BLITZER: All right, Jack. Thank you.