Preview of Barack Obama's Speech; Recession Could End This Year
BLITZER: All right. We're getting excerpts from the president's address before a joint session of Congress tonight. Let's go back to our senior White House correspondent, Ed Henry. What are we getting -- Ed?</s>HENRY: Well, Wolf, it's interesting, because, as you know, these excerpts in any administration are always very carefully picked by the administration to make sure they lay out what they want, to be very positive, to sort of set the table for the speech. So this excerpt that they're putting out is on the optimism question that we were just talking about. At one point, the president in the speech will say: "While our economy may be weakened and our confidence shaken, though we are living through difficult and uncertain times, tonight I want everyone American to know this -- we will rebuild, we will recover and the United States of America will emerge stronger than before." The president goes on: "The weight of this crisis will not determine the destiny of this nation. The answers to our problems don't lie beyond our reach. They exist in our laboratories and universities, in our fields and our factories, in the imaginations of our entrepreneurs and the pride of the hardest working people on earth. Those qualities that have made America the greatest force of progress and prosperity in human history, we still possess in ample measure. What is required now is for this country to pull together, confront boldly the challenges we face and take the responsibility for our future once more." So hitting the themes we've heard from the president before, but coming into a little sharper focus about saying he's confident America will emerge stronger. But also using that word responsibility when he talked in his inaugural address about ushering in a new era of responsibility -- that the government will be here to help, but that there will be some sort of personal sacrifice and responsibility from people around the country -- businesses, institutions -- to help pull this through -- Wolf.</s>BLITZER: I almost hear, Ed, an echo of Franklin Roosevelt, if you will, in those kinds of remarks -- it's a tough time, but we can get through this.</s>HENRY: And what is interesting, you're absolutely right -- is that this comes, obviously, after we've heard former President Bill Clinton and others make that very suggestion, that while it was important in recent weeks and while he was selling the stimulus package for the president to come out and lay it out and say, look, soberly, this is a crisis. It could become a catastrophe. And in the estimation of senior White House officials, level with the American people. Because they believe that former President Bush took too long to tell the American people just how bad the economy was getting. So that they say that they're trying to be straight with the American people. They're trying to level with them. But then you have heard Bill Clinton and others saying yes, but you need a little bit of optimism at the end of it -- a little Reaganesque, if you will, as well, not just FDR. And that may be what we hear more of tonight -- Wolf.</s>BLITZER: Is it your sense that this fine line we've been talking about, about reassuring the American people, that this is, after all, the United States of America and we will get the job done -- he doesn't want to be overly optimistic or Pollyannaish, because if things continue to deteriorate in the short- to middle-term, he'll look like -- he'll look like he wasn't leveling with the American people.</s>HENRY: You put your finger on exactly why this is a very delicate balancing act for this president. If you're too optimistic, you're accused of putting out rosy scenarios for the American people. If you're too pessimistic, your critics say you're talking down the economy -- that there's a psychology that's dealt with for the economy, as well, and that once you keep saying it's bad, it's ugly, it's going to get worse, then the markets react in a negative way and think, look, if the president thinks it's awful, it must be really awful. So it is a very delicate balancing act. One thing that you should know -- what senior officials are saying about how they're approaching this speech is they believe that despite all the difficulties, that this president has accomplished a lot in the first five weeks here. And they believe he's going in with a bit of a head of steam -- Wolf.</s>BLITZER: Ed, stand by. I want to bring in a special guest right now. Republican Senator John Thune of South Dakota is joining us. Senator, thanks very much for coming in.</s>SEN. JOHN THUNE (R), SOUTH DAKOTA: Good afternoon, Wolf.</s>BLITZER: And I want to read to you what -- Ed Henry just gave us the excerpt -- the bottom line, if you will, of what we'll hear from the president tonight. He says: "We will rebuild. We will recover. And the United States of America will emerge stronger than before." Are you confident, as the president is?</s>THUNE: It's a great country, Wolf. The American people are very resilient. And what we've got to do is put the right policies in place so that we can rebuild and recover. But I think that's a good tone to sound in his remarks. And I think the American people want to hear optimism. There's been a little bit too much sort of talking down the economy. And I think that the American people are anxious to hear a note of optimism from the president. So I think that would be welcomed not only by those of us who will be in the chamber tonight, but by the American people across the country.</s>BLITZER: What specifically, Senator, do you want to hear from the president tonight that would make you reconsider your opposition, for example, to the economic stimulus package?</s>THUNE: I think the main thing that Republicans will want to hear, one, is that the president, the next time around, is going to work in a meaningful bipartisan way to try and get Republicans involved earlier on in the process -- give them some ownership in some of these big issues we're dealing with. And, secondly, I think there some are things that Republicans would like to find common ground on. There are, clearly, when it comes to reforming the budget process, entitlements -- all the things that are going to cost us into the future, a balanced approach to balancing the budget, doing something about health care reform in the long run. There are lots of big issues. And energy policy is another example of that, where I think that the Republicans are anxious to work in a constructive way with the president. But it's going to be really important that he reach out to Republicans and not just -- not just in rhetoric, but that be translated to Democrats here on Capitol Hill, who at least with the stimulus, decided to write the thing their way without any Republican input or support.</s>BLITZER: It seems like the Republican leadership in Washington, Senator, is obviously very much opposed to what the president is trying to do, as reflected in the economic stimulus package. But if you go outside of Washington and speak with some of the Republican governors, like Charlie Crist of Florida or Arnold Schwarzenegger of California, or go speak with some Republican mayors out there, they're ready to take the money and they're ready to move on and try to get people back to work. Do you see the split between Washington Republicans and outside the Beltway Republicans?</s>THUNE: It's a mixed bag. As you know, there are a number of Republican governors who said this is too much, we don't want all the strings attached. I think the concern that those governors have, Wolf, is that this thing becomes a liability well into the future. Most of us believe that a lot of these programs, once funded, will be continued. And if they are, the Congressional Budget Office says that this stimulus bill is not going to cost $1 trillion, but $3 trillion. And I think the governors are worried about, down the road, having to raise taxes. But you correctly point out that there are some governors who are -- who are willing to accept the stimulus money. I think it's reflective of the entrepreneurship in the Republican Party. We're a lot of people who have different ideas. Some have decided to embrace this. Others have decided that this doesn't make the best sense for them in their states. And I think most Republicans, in Congress, at least -- and what we heard from the American people was that we don't want to see this level of borrowing. Now the public opinion polls that you're referring to, I think if you asked people a question about whether or not they supported an economic recovery plan that would create jobs, most of them are going to say yes. If you tell them that we're going to borrow the money from the Chinese and hand the bill to our children and grandchildren and it's going to be trillions of dollars over time, you would get a different response.</s>BLITZER: I want you top listen to this quote from a rising star in the Republican Party, Governor Jon Huntsman of Utah. He's a Republican. He told "The Washington Times" this. This is the quote: "I don't even know the Congressional leadership. I have not met them. I don't listen or read whatever it is they say, because it is inconsequential completely." It seems to be a critique not only of the Democratic leadership, but even the Republican Congressional leadership, that they're out of touch with the American people. Those are pretty tough words from Republican Governor Huntsman.</s>THUNE: I think it's very popular to bash Washington and to bash Congress. It's a very easy thing to do. But I do think what Governor Huntsman is getting at is that the parties need to put good ideas on the table. And the Republican Party, we can't just be the party that says no to the Democrats and their ideas and no to the president. We have to come up with better policy alternatives, better ideas. And on that point, I don't disagree with them. But I do think that right now, they've got a lot of governors who have aspirations beyond their current jobs who are making statements like that, because they realize it's very popular with the American people to bash Washington and to bash Congress.</s>BLITZER: Thanks very much, Senator Thune, for joining us.</s>THUNE: Thanks, Wolf.</s>BLITZER: And coming up, I'll speak live with Senator John Kerry. He's just back from Gaza. He's back from Syria. While he was in Gaza, he was handed a letter to deliver to President Obama from Hamas. Stand by. My interview with the chairman of the Foreign Relations Committee coming up. Plus, the federal Reserve chairman weighs in on when he thinks the recession will end. Stay with us. Lots of news happening today, right here in THE SITUATION ROOM.</s>BLITZER: When are we going to see some light at the end of this economic tunnel? The Federal Reserve chairman, Ben Bernanke, testified today before the Senate Banking Committee. Let's bring in our senior correspondent, Allan Chernoff. Is he giving us an assessment of when things will begin to turn around?</s>ALLAN CHERNOFF, CNN SENIOR CORRESPONDENT: He is. And, as you know, Wolf, the big thing that's been worrying the financial markets has been this issue of will the banks be nationalized? Well, the Fed chairman said he does not intend to do that. What he wants to achieve is to get the financial system simply working again -- where capital can flow from lenders to borrowers.</s>CHERNOFF (voice-over): Federal Reserve Chairman Ben Bernanke offered a ray of hope for the economy.</s>BEN BERNANKE, FEDERAL RESERVE CHAIRMAN: There's a reasonable prospect that the current recession will end in 2009 and that 2010 will be a year of recovery.</s>CHERNOFF: That's if the government can restore financial stability by getting the lending markets functioning normally again. To do that, Bernanke said, the government needs to restore confidence in the nation's banks -- not necessarily by nationalizing them, but by supporting them, with extra capital, if necessary.</s>BERNANKE: I don't see any reason to destroy the franchise value or to create the huge legal uncertainties of trying to formally nationalize a bank when it just isn't necessary.</s>CHERNOFF: Already, the government has injected about $315 billion into the nation's financial institutions. Beginning Wednesday, the nation's biggest banks will face a stress test -- a test of a bank's financial strength, to determine if it can survive a deep and severe recession. Bernanke said any major bank that appears vulnerable will be able to get additional financing. The point, he argued, is to make credit easily available for qualified borrowers -- even if it means spending billions more in tax payer money.</s>BERNANKE: A lot of this goes against American values of self- reliance and responsibility. And I'm very, very aware of that.</s>CHERNOFF: The Fed chief also offered a forecast for the economy that is quite a bit more optimistic than what many private forecasters are predicting. He's saying the economy may contract by as much as 1.25 percent. Consider that during the fourth quarter, the economy contracted 3.8 percent. Still, the Fed chief concedes it could take as much as three years for the economy to completely recover -- Wolf.</s>BLITZER: Well, the markets were reassured today. The Dow Jones going up, what, about 236 points?</s>CHERNOFF: Yes. We didn't even gain back what he lost yesterday.</s>BLITZER: But at least it went up today.</s>CHERNOFF: At least it went up. A nice change.</s>BLITZER: Yes. All right. That's good.</s>CHERNOFF: We'll take it.</s>BLITZER: They're reassured to a certain degree. We'll see what happens tomorrow and the day after. Allan, thanks. Let's bring in our Democratic strategist and CNN political contributor, Paul Begala, and Republican strategist and CNN contributor, Alex Castellanos. Guys, thanks very much for coming in. Is it likely that we're going to see a change, Paul, right after the president's address to a joint session of Congress tonight in terms of the mood of the American public? In other words, can he reassure everyone that, yes, there will be light at the end of this tunnel?</s>PAUL BEGALA, CNN CONTRIBUTOR: You know, frankly, Wolf, I think it's asking too much out of one speech. I mean I went back and looked and I love -- you know, I'm an old White House speechwriter myself. Bill Clinton -- a great speaker; Ronald Reagan -- a great speaker. One speech usually doesn't move public opinion, even for those very talented speakers. Now, Barack Obama -- as good a speaker as we've ever had in the White House. But, no. I think it's going to actually take moving things on the ground. I think what he's going to seek to do instead is to build support for his agenda -- education, health care, energy reform -- those types of issues that have taken a bit of a back seat to the public discussion of the current economic crisis. I think he wants to build a case for supporting education, health care, energy. And I think that's probably more important to him than turning around the current mood of the country.</s>BLITZER: He does have, Alex, according to all the major national public opinion polls that have been done in the past few days, very high job approval numbers right now. Between 60 and 70 percent approve of the job he's doing. So while he's being criticized by, certainly, a lot of Republicans in Washington and others around the country, it seems the overwhelming majority of the American public is with him right now.</s>ALEX CASTELLANOS, REPUBLICAN CONSULTANT, CNN POLITICAL CONTRIBUTOR: And there's good reason for that. He's not only a very gifted communicator. I think Republican or Democrat, you don't question his sincerity and his commitment to trying to do something about this problem. He's brought an openness to government. I mean what he did, bringing in the Republicans and Democrats yesterday to the White House, I thought, was something Washington needed. And the Republicans, I think, have to give him credit for that. But I think Paul is right. He's going to be judged on the merits, on the substance. But we're not going to hear a lot of that tonight, about the intricacies of the stimulus plan. And he's not going to open up the sausage and let us see it. He's going to, instead of talking about substance, he's going to talk about the needs of the country and the ends, the -- some great optimism that we're going to get to one of these days. So it's going to be a bit like a magician. He's going to distract us from the substance with some -- I think, some very soaring rhetoric about the future and what this country can be. He's been too pessimistic lately. You're going to hear optimism tonight.</s>BLITZER: Some are suggesting, Paul, it might be like FDR's fireside chats -- that he's going to try to explain to the American public what's going on.</s>BEGALA: Right. In fact, I think he's going to do two things. First, he's got to explain and then he's got persuade right? He's got to explain to folks why it is. It's a hard sell. Why it is we had to send hundreds of billions of money to banks that screwed up. Why that matters to me. Why if my neighbor loses her house, why do I need to care about that when her mortgage is foreclosed on? Well, it actually costs me $20,000, an average house if the house next door forecloses. So to explain first that we're all it together and persuade his prescription, rather than the prescription of the party opposite is the right way to do it. So I think he's got to do those two things tonight.</s>CASTELLANOS: But you know Wolf, I don't think he's going to get into the details. We're not going to hear a lot about how the stimulus works because it's broken window economics. There's old economic theory that says, you know, if I throw a brick through your wind oh, I'm actually creating a job. Because you have to hire somebody to fix it. And, well, actually, you are having to take that money from some place else you might have spend it and create a job there. At the end of the day we haven't really added anything to the economy. This democratic plan is just broken window economics. We're all going to break each other's windows and somehow pretend that's going to make us more prosperous. He's going to talk about big picture and then try to move us into the future.</s>BLITZER: But he is going to talk about not only the economy, but also his vision for health care reform, which is a major priority that he is making it clear to anyone who meets with him he's not backing away from that. Energy reform, he's got a lot on his plate right now. Is there a -- is there a potential problem, Paul, that he's trying to tackle too much at the same time?</s>BEGALA: Yes. But he has no choice. You had lunch with the president today. I'm not hanging out having lunch with him. I have sources who work for him. They are quite passionate about the long- term agenda, in addition to the immediate stuff we've got to do. The house is on fire, frankly, an arson set by some of Alex's friends in the Republican Party. We've got to put the fire out and then build a new house. That is education, health care, energy. He's passionate about those issues. And those are longer term issues. At the same time, we have 17,000 new troops being deployed to Afghanistan. That war is heating up. The war in Iraq continues. God bless those people over there. He's still got two hot wars to fight. He has no choice. He has to do all these things at once.</s>BLITZER: It's a tough act that he's going to try his best at tonight. We'll see how he does. All right. Guys, thanks very much. The man who safely landed a passenger jet on the Hudson River has a beef.</s>CAPT. CHESLEY SULLENBERGER III, US AIRWAYS 1549: My pay has been cut 40 percent. My pension like most airline pensions, has been terminated.</s>BLITZER: And Captain Sullenberger says deep pay cuts impact more than just airline workers. The hero pilot's dire prediction is still ahead. Plus, a corner of the world posing a great threat. Senator John Kerry just back from the Middle East and South Asia. He's here to talk about what he learned. We'll talk to him live. That's coming up.