L'AQUILA, Italy -- Developing nations led by China and India refused Wednesday to back lofty but long-term targets proposed by the Group of 8 industrial nations to cut greenhouse gas emissions, balking at reluctance by leaders of the world's biggest economies to move more quickly on their own.

Inability to bridge the gap between rising carbon-emitting countries such as China and the longtime polluters within the G-8 underscores the steep challenges involved in attempting to strike a comprehensive bargain to contain global warming.

The impasse comes down to the politically sensitive issue of who goes first.

President Obama and his counterparts in the G-8, who are holding two days of meetings in the central Italian mountain town of L'Aquila, offered broad agreements to reduce greenhouse gas emissions by 2050. The statement pledged to slash global emissions by 50%, led by reductions of 80% by the G-8 countries.

They also prepared to offer new financial incentives for developing nations to join the effort.

But the G-8 stopped well short of pledging to take aggressive action that could curb emissions more quickly -- at the cost of higher energy prices and a feared worsening of the global economy.

And neither the broad promises of future action nor the relatively modest financial incentives were likely to break the standoff between the most advanced economies and the emerging powerhouses. Countries such as China, India and Brazil are unwilling to take the first steps to cut emissions that could choke off economic growth, instead demanding that wealthier nations take the lead.

See the full report on the climate-change impasse in Tribune newspapers and here in the Swamp:

"China's not going to do anything until the developed countries send a signal that they're going to do something," said Michael Oppenheimer, a geoscientist at Princeton University and a longtime participant in the Intergovernmental Panel on Climate Change.

The standoff at the summit perpetuates a divide that must be bridged this year if there is to be a global agreement on curbing emissions.

The United Nations is convening a meeting in Copenhagen in December aimed at forging a binding consensus on targets to reduce greenhouse gas emissions. But unless China and other developing nations can be persuaded to sign on to an accord, Obama may find it difficult -- if not impossible -- to convince Congress to go along.

The stalemate on the international stage mirrors Obama's problem at home. Though the House approved a major climate bill last month, Republicans and other critics have unleashed a hailstorm of criticism. They argue that emissions limits by the United States and other advanced economies alone would have relatively little effect on global warming, while potentially harming the domestic economy.

Obama's climate bill, which narrowly passed the House, could send a strong signal if it becomes law, said Dirk Forrister, who was chairman of the White House climate change task force under President Clinton and now is managing director of the financial firm Natsource LLC.

But, he said, "the U.S. Senate will not go along with anything unless it sees some pretty serious action from developing countries." That, analysts say, sums up Obama's conundrum as he tries to push for a meaningful climate agreement during formal treaty negotiations in Denmark this winter.

"It looks like it's going to be a pretty tough fight [in Copenhagen], based on what happened in these meetings in Italy," Forrister said.

U.S. leaders hinted that a broad coalition of developing and developed nations could announce agreement today to team up on research on renewable energy and technology to scrub and store greenhouse emissions from coal.

Michael Froman, Obama's point man at the summit and lead staff negotiator, argued that the major industrial nations' joint statement favoring an 80% reduction in their emissions by 2050 represented "significant cooperation" -- even though it came up short of the draft language that the White House had supported.

The G-8 targets roughly followed those in Obama's domestic climate bill.

The G-8 countries also set a global goal of 50% emissions reductions by mid-century, and declared that they recognized "the broad scientific view that the increase in global average temperature above preindustrial levels ought not to exceed" 2 degrees Celsius (3.6 degrees Fahrenheit).

They did not announce any specific plans to cut emissions or adopt any short- or mid-term reduction targets. The United States pushed, and failed, to get developing nations to join in the reduction pledge.

"In any negotiation, you put in a number of points," Froman said.

"Sometimes they make it in and sometimes they don't."

The statement that did not come -- the one that would have included China, Brazil and other developing countries -- is the one that matters, he acknowledged.

But both Froman and chief Obama climate negotiator Todd Stern argued that there was plenty of room to work out an agreement before the Copenhagen summit.

"It's a negotiation. Countries may make concessions further down the road," Stern said in an interview.

Obama will chair a meeting of the world's largest emitters, including both developing and developed nations, today in Italy.

Analysts said the Obama administration could strengthen its hand in future negotiations with another victory or two at home -- Senate approval of a climate bill and, even better, passage by Congress of a conference version of the bill that Obama could sign into law before the Copenhagen talks.

"His most powerful weapon is a piece of signed legislation," said Melinda L. Kimble, senior vice president of the United Nations Foundation and a former climate negotiator in the Clinton administration.

"If he has that in his pocket," she added, "everything else he has is icing on the cake."

Christi Parsons reported from L'Aquila, Italy. Jim Tankersley reported from Washington.

WAUKON, Iowa -- One is a thrifty soybean farmer from Iowa with a penchant for righteous speeches about government waste. The other is a Stanford-educated lawyer from a Montana ranching family who looks uncomfortable leading a debate.

Despite more than 60 years in Congress between them, Charles E. Grassley, the Iowa Republican, and Max Baucus, the Montana Democrat, are outsiders -- loners whose independent streaks make colleagues wary, sometimes even mistrustful.

But unlikely as it may seem, the partnership between these two slightly eccentric men may hold the key to overhauling the nation's sprawling healthcare system -- a legislative grail that has eluded the giants of the Senate for more than half a century.

In the face of strident criticism from colleagues in both parties, Baucus (chairman of the Senate Finance Committee) and Grassley (the panel's senior Republican) are laboring to fashion a series of compromises on healthcare that might win the support of a bipartisan majority on Capitol Hill.

Their effort got a nod Wednesday from Senate Majority Leader Harry Reid (D-Nev.), who at a meeting with Grassley encouraged the quest despite complaints from more-partisan Democrats.

The stakes remain high. If Baucus and Grassley fail, this year's historic healthcare debate easily could devolve into another battle royal between the parties, with the prospects for meaningful legislation uncertain at best.

Many Democrats and Republicans have already rejected a middle ground.

"On both sides, there are people who want it their way or the highway," said Senate Budget Committee Chairman Kent Conrad (D-N.D.), who is working with the two on a healthcare bill. "But if we want to really make a difference with healthcare . . . it is critical that we find some compromise."

See the full report on healthcare reform and the two senators seeking it in Tribune newspapers today and here in the Swamp:

Baucus and Conrad are among the senior Democrats who think that their party will need some Republican support to get the 60-vote supermajority necessary to prevent a GOP filibuster and move a major healthcare bill to the president this year.

Democratic Sens. Edward M. Kennedy of Massachusetts, who had been expected to lead the charge on healthcare, and Robert C. Byrd of West Virginia are battling serious illnesses and may not be able to cast their votes.

Moreover, a number of moderates in the party have expressed reservations about parts of President Obama's healthcare agenda, including the creation a government health insurance plan.

And although Democrats could use a procedural rule they passed earlier this year to push through some healthcare legislation with a simple majority, the rule may prevent them from enacting a comprehensive bill.

Baucus and Grassley have been among the fiercest critics of a single-party approach.

"Fundamentally, legislation that is historic, that is comprehensive, that has a large number of senators supporting it is more durable," Baucus said in an interview. "It will be more sustainable and will inspire more public confidence."

Baucus, who came to the Senate in 1979, and Grassley, who joined two years later, have let that philosophy guide them since they assumed senior posts on the finance committee eight years ago.

The two do not socialize outside of the Senate. But since 2001, they have met nearly every Tuesday at 5 p.m. in Baucus' conference room on the fifth floor of the Hart Senate Office Building. (The coffee is free there, the parsimonious Grassley likes to joke.)

Both men said that they slowly grew to trust one another and to look for places where they could agree.

"We are pragmatists," Grassley said while in Iowa recently to meet with constituents. "We come from similar states, and I think we have a similar idea of what bipartisanship is all about."

Said Baucus: "Most people in this country want us to basically work together, to get something done between the 20-yard lines. They are in the center."

Their bipartisanship has at times grated on their colleagues, however.

Baucus infuriated fellow Democrats by working for President George W. Bush's tax cuts in 2001 and then featuring a photo of himself with Bush in a campaign flier during his 2002 reelection campaign.

It was only last year that Baucus emerged as a leading champion of universal healthcare, a goal that Democrats have been chasing since the Great Depression.

From the start, he enlisted Grassley's help.

The two senators' staffs have been in almost daily contact, hashing out language for a bill that Baucus has promised will expand coverage, hold down costs and improve quality.

Whereas Democrats on Kennedy's health committee developed their bill largely by themselves and then showed it to their GOP colleagues -- a process that infuriated Republicans -- aides to Baucus and Grassley "started with a blank sheet of paper," as one Republican staffer said.

The effort has won implicit support from Obama, who has said repeatedly that he does not want to draw lines in the sand on the issue. The president has spoken frequently with both senators in recent months.

But as the healthcare debate intensifies on Capitol Hill, it is unclear how long Grassley and Baucus can sustain their middle-of-the-road approach.

Grassley is under pressure from GOP lawmakers to break off negotiations. Arizona Sen. Jon Kyl, the No. 2 Republican in the Senate, said in a recent C-SPAN interview that the Iowa senator had no authority to represent Republicans.

"There are a significant number of senators, some in powerful positions, that feel I am helping to pass something that is going to be bad for this country," Grassley said. "They believe that if I wasn't working for a bipartisan thing, Democrats would implode and beg for Republican help."

The pressure on the other side of the ideological spectrum is even more severe, as liberal lawmakers and advocacy groups intensify their campaign for a government insurance plan, which polls show is broadly popular.

In recent weeks, several groups, including Health Care for America Now and the Laborers' International Union of North America, have run ads targeting Grassley and Baucus in their home states.

"The majority of people support where Democrats want to take this country," said Healthcare for America Now national campaign manager Richard Kirsch. "If you have a majority of Democrats who want something, why should the minority define what will happen? That just seems like bipartisanship for bipartisanship's sake."

Jeb Bush, the former governor of Florida, son of one president and brother of another, is attempting to forge a new consensus within the Republican Party on issues which might reengage the party with a disaffected voting public.

There are few issues bigger than immigration reform, when it comes to rifts within the GOP, or rifts within the Democratic Party, for that matter. Bush, who serves as chairman of a Council on Foreign Relations task force on immigration, says it's essential that Congress get immigration right. That means not only revamping the legal channels of immigration, including those for guest workers whom American employers need, but also finding a path to legal citizenship for some of the 12 million undocumented workers living in the United States.

If it sounds like an agenda that his older brother pursued, it is. The Senate adopted former President George W. Bush's vision for "comprehensive immigration reform,'' only to see it fail in the House. President Barack Obama hopes to revive it in some fashion, though the domestic congressional agenda already is piling up with potentially irreconcilable issues, such as healthcare and energy.

If the former president had a personal perspective on the debate, as the former governor of border-state Texas, his younger brother has a personal perspective as well. His wife was born in Mexico, and they moved from Texas to Miami in part to find a community more hospitable to a bicultural family - as well as helping his dad campaign for president the first time around. Florida stands on the front lines of illegal immigration as well.

Lately, since retiring as governor of Florida after the legal limit of two terms, the 56-year-old Bush has been working behind the scenes at attempting to forge some new leadership within his party. He passed up an opportunity to wage his own campaign for an open Senate seat, and some still view him as one of the party's better prospects for the presidency, though overcoming the hurdle of one Bush who lost the presidency after one term and another who left office after two terms with a severely depressed public image of his performance could be a long waiting game for those who hold out any hope of a Bush trifecta at the White House.

The changing demographics of the United States, with fewer workers and more retirees, should compel Washington to make comprehensive immigration reform a top policy priority, Bush says in an interview published by the Council on Foreign Relations. At the same time, he acknowledges how difficult an already complex issue is in the context of an already crowded and contentious domestic debate.

"I would say the principal problem is a lack of confidence that the federal government was capable of protecting the borders,'' Bush says of the failure to win immigration reform in recent years. "We've had immigration reform every decade. Commitments were made about enforcement, and clearly they haven't [been] delivered.

"So there's a lot of frustration, a lot of anger regarding that and that has made comprehensive immigration reform difficult,'' he allows.

(Former President George W. Bush, above left, and his brother, former Florida Gov. Jeb Bush, above right, at the parachute jump of their father, former President George H.W. Bush, center, celebrating his 85th birthday earlier this year in Kennebunkport, Me. Photo by Robert F. Bukaty / AP)

"Today the conditions are a little different because there has been a major effort to enforce the border, particularly the Mexican border. There's been a significant deployment of border patrol agents, [and] there is new technology that now is on the border between Mexico and the United States. There is evidence that there are fewer people crossing. So that creates an opportunity.

"There are some significant hurdles'' still, he allows. "It's very complex for starters. It's not a simple policy discussion...

"We have to reform the administration of immigration flows; we have to reform the legal immigration system that is quite cumbersome. We have to deal with employer sanctions in a different way; and [we have to] deal with the very difficult issue of what to do with the twelve million people that are here illegally--what means will they have to be able to find a path of legalization?

"So it's very complex, and anything this complex makes it difficult,'' he says. "When you combine that with the fact that the Obama administration has embarked on some incredibly complex initiatives beyond immigration related to climate change and health care and trying to deal with a down economy, all of this makes it quite difficult to imagine this happening immediately.....

"It's important to recognize that given the demography of the United States, we've got to get immigration right,'' Bush says. "We have to have a legal system of immigration that accounts for the fact that we have fewer workers that are producing the resources to take care of a growing number of people who aspire to be retired.

"Given the birth rates of the U.S. population, there's no possible way we can sustain our entitlement programs without having a strategy in place that recognizes that the legal flow of immigration matters. These are issues that really are not typically topical when you hear the conversations on television, or when you hear the conversations in Congress, but they're important.''

Without reform, he says, "we certainly miss a huge opportunity as it relates to the competitive posture of the United States. One of the real weapons we have in competing economically is our ability to absorb immigrants--legal immigrants--that make huge contributions to our country.

"And then we ignore an issue that needs to be solved, which is what do we do with people who are here permanently, who have made contributions, who if given a path to citizenship would do what's right and take the necessary steps to achieve legalized status and citizenship. We just can't ignore these problems.''

See the full interview with Bush at the Council on Foreign Relations.

Michelle Obama may not have made much of a splash in Moscow, where any obsession with Western fashion still has one foot in the Cold War, but the Romans are watching the American first lady, on tour with her husband for the G-8 summit .

The first lady arrived at the Capitoline hill, one of Rome's seven, around noon today, catching a brief bird's eye view of the Roman Forum. The Capitoline Museums are part of the Campidoglio, the Capitol Hill of Rome. The spouses of the G-8 leaders had lunch there with their host, the mayor's wife, Isabella Rauti Alemanno.

. "It's the city, the most important in the history of the city," said Gian Paolo Pelizzaro, a spokesman for the mayor, speaking of a museum that houses a colossal sculpture of Marcus Aurelius on horseback as well as the original bronze of the she-wolf suckling Romulus and Remus, which is the symbol of Rome.

Before a tour of the museum, the first ladies had lunch on a terrace overlooking the city. The head table was covered in ivory tulle with centerpieces of red and yellow roses mixed with oranges and apples. The chef, Heinz Beck, a German-born gazillion star chef with a restaurant in Rome called La Pergola, delivered the fare: Lobster medallions, veal filet on apricot puree and, for dessert, walnut semi-freddo.

Michelle Obama wore black flats and what the print pooler described as a taxicab yellow sheath with an oversize green floral brooch on her left shoulder. "From a distance it looked to be bakelite and frankly resembled lettuce,'' the pooler noted.

With thanks for the pool reporting of Robin Givhan of the Washington Post.

lPhoto of Michelle Obama, above, with Sarah Brown, wife of British Prime Minister Gordon Brown, during their visit at the Capitoline Museums in Rome, Photo by Domenico Stinellis / AP)

Labor Secretary Hilda Solis, who still has $250 million to "roll out'' for job creation, maintains that the Obama administration is "not looking at just a quick fix'' for the economy and allows that this is "the toughest job'' she ever has held.

The former congresswoman from Callifornia and member of President Barack Obama's Cabinet, says in an interview airing this afternoon on FOX Business Network that the administration is intent on pursuing solutions to the recession that will "take us out of this bad economy for the next decade.''

"We're not looking at just a quick fix here, we're looking at something that is going to take us out of this bad economy for the next decade,'' Solis says. "And we have to make these investments that were neglected in the last eight years."

With unemployment at 9.5 percent in the latest count, and with the Obama administration holding out hope that the economic stimulus that the president signed in February will save or create 3.5 million jobs, the Labor secretary says it's too soon to start talking about any second stimulus bill.

"I think it would be wise to go ahead and extend all of the dollars that we have already set aside that have been approved by the Congress,'' Solis says.

On that joblessness - the highest in 26 years - the secretary says: "I'm not going to be able to predict how far down we may go...I think it's too soon for me to say that you know, things are going to get worse. I can't say that.

"I predict that there will be some bumps ups. We may have some peaks and valleys here. But I think we're on the right track...

"We have managed to stabilize at least that tremendous number of job loss. And I think that we're going to have to restructure our work force. The manufacturing industry has to change. It has to be competitive, it has to look forward to where there's going to be growth. And I think green jobs, renewable energy is a path that we can look at,'' Solis says.

"This is the toughest job I've ever had. But it's also one that is very gratifying to me because I can see that I can actually touch people in a way that perhaps other agencies can't,'' she says. "It's a challenge. But it's a challenge that I take very seriously and I know that there are a lot of people counting on me. And I know that everything that I do, every decision I make is going to be weighted so enormously by so many people, by our critics.''"

Here, courtesy of FOX Business Network, is a look at that interview with Solis airing this afternoon:

LIZ CLAMAN, FBN ANCHOR: Let's just start with the overall important unemployment picture (ph). How bad is the unemployment ...

HILDA SOLIS, SECRETARY OF LABOR: Well, you know it is bad right now.
And nobody is happy. And the president and I feel very, very strongly that we have to do everything we can to create job. We should not be in a situation where we're losing jobs. We need to add jobs to the economy.

CLAMAN: We just got new JOLT data, which is the job openings and layoffs and it's pretty dismal. For every six unemployed people, there's one job. Plus the pace of hiring is the slowest in the history of the JOLT survey.

What do we do to turn that around? As dismal as it looks, what can you do right now?

SOLIS: Well, I don't want people to be discouraged because I know last month there were four million people that were hired in jobs. And so there is still that opportunity.

Maybe people need to think about reassessing their skills and maybe looking at where the job growth will be. And green jobs, renewable energy, hi-tech areas, health care careers -- these are going to be the growing industries.

I think we've got to take a look at how and where these jobs will be created and incentivize people to get into job training programs. We provide for that through the Department of Labor. And in addition, there are funds available to pay for their training.

CLAMAN: How long do you think, though, the U.S. will continue to shed jobs at a similar to the pace that we saw in June?

SOLIS: You know, it's hard for me to predict because I look at past months and yearly figures and when you think about where we started -- because we inherited this situation in January -- and there upwards of 741,000 people. Now we're down to what -- 400 -- about 440,000, somewhere in that area.

So it has gone down a bit. And we're kind of restabilizing and seeing that there is a little up peak now we're seeing in retail and in construction. And I'm very excited about what's going to happen with the infrastructure (INAUDIBLE) that are going to be coming out to help put people back to work.

CLAMAN: We'll get to that in just a minute. But Vice President Joe Biden said this weekend that the recovery may be further off than initially thought.

Do you agree with that?

SOLIS: I think it's going to take a while. And I think the president and the vice president have been very clear that this is something that we just didn't enter into two months ago, or four months ago. This has been going on for more than two years. And we're not going to get out in a short period of time. But we're going to keep working at it.

And I think that's the message that the American public needs to hear.
That we are strongly behind this economy and strongly behind our working families.

CLAMAN: Employment is a lacking indicator. Everybody spits that out like it's supposed to make us feel better. But there's not much in the June labor numbers that give us hope about the economy pulling out of the jaws of recession.

Is it possible Secretary Solis, that we would see a jobs depression within the next couple of months?

SOLIS: Well, I'm not going to be able to predict how far down we may go. But we will see more bumps in the road, definitely. But, I think if we keep track and keep our eye focused on where we need to go and that means job development. That means employment training. That means incentivizing people to get to work.

So for example, the president has made it an initiative to weatherize one million homes. We obviously don't have that workforce. So, we need to train people and there will be funds to provide for that. And get both the private and public community together to hopefully accomplish the goal of getting people to work and getting our economy stimulated.

CLAMAN: George Bush had job training programs out there. It takes a long time to filter that through. You know Americans, they do want immediate results. And, of course, they're waiting to see what some would anticipate would be a faster move for the stimulus to have pushed jobs out there.

SOLIS: Right.

CLAMAN: Do you think the people are getting angry and a little more impatient? What are you hearing from people?

SOLIS: Well, I hear different things. I do hear that there is also a good deal of I don't want to say optimism, but I want to say people are very mindful of what this administration is doing.

It's not an easy task to get a $787 billion stimulus program approved in record time. That was just issued in February. Here we are a few months down the line. You can't expect everything to happen overnight.

So, let's have some patience. Let's have that American wear with all spirit that I see when I go out into different communities where people are saying, thank the president for making an investment in my job training, in my unemployment insurance and in my health care. These are real things that are happening. People are spending that check. It is going back into the community which is helping to stimulate our local commercial industries that are right now also suffering.

CLAMAN: Are you personally, though, comfortable with the pace at which jobs are filtering down from that --

(CROSSTALK)

SOLIS: No, absolutely not. And I won't be happy. I mean, this is the toughest job I've ever had. But it's also one that is very gratifying to me because I can see that I can actually touch people in a way that perhaps other agencies can't.

Whether it's getting them their unemployment insurance, their health care coverage that they're eligible for. Or, a job training opportunity for them. Or turning someone's life around. For example, young people that I see that needed a second chance are now going into construction jobs and in renewable energy fields. At the same time getting a salary but also getting a training program made available to them at no cost to them. And that's something to me is incentivizing our young people.

CLAMAN: I know you don't want to make predictions about unemployment figures and rates. But surely you're working models about the unemployment rate. There are people out there -- top economist, say for example, Mohamed El-Erian of PIMCO, who says that the 9.5 percent unemployment rate is very alarming because it doubles from 4.8 percent just 16 months ago. And that we needn't be understating how bad it is with a 9.5 percent rate.

How much higher does the unemployment rate go? What is your model telling you? We certainly don't stop at 9.5 percent. Surely not there.

SOLIS: Well, I'll tell you, I rely very closely on what the Bureau of Labor statistics puts together. So every month they put down their figures and their reports and sometimes it's not as predictable as we would like it to be.

So, I'm in a position where all I can do is rely on the data that they provide me. It's a very reputable organization. It's been around for decades.

(CROSSTALK)

CLAMAN: But 10 percent? 11 percent? I mean, California's 11.5 percent --

SOLIS: But we're not in a position to forecast that at this time.
What I would say to you is, we probably will see an up peak and then again it may go down in a couple of months, once we see the recovery money in infrastructure programs really hitting our local communities and our local government.

CLAMAN: It's not (INAUDIBLE) -- the Obama administration was the only
organization that for this wrong. I mean, Goldman Sachs predicted,
yes, it'll hit 9.5 percent at the end of 2010. So everybody's restricting their models at this point.

SOLIS: Right.

CLAMAN: But the Obama administration has come out with a budget in the early months that some people thought was a big optimistic. And then you start to see the headlines about the so-called rosy scenario.

Has the administration misread how bad this would get? And how are they now realizing it's much worse?

SOLIS: I don't know that that's the appropriate description I would use because as we see other industries falling to the side, for example, the automobile industry, we could have seen much worse happen if we didn't have a stimulus program. I can tell you that.

We saved jobs. We also helped to restructure our financial institutions so that credit would be made available. So that has helped incentivize our businesses. I think also in terms of just trying to see our programmatic effort. It takes time to roll out federal dollars from Washington, D.C., to the local governments. So, that's going through the permitting process.

If it requires buildings, if it requires putting people to work and getting trained, that also has to go through what they call a grant-solicitation process. And we just barely gave out $500 million in de-notification to receive grants. So that just happened in a matter of two and a half, three weeks ago.

So we still have yet to see the money realized. So I think it's too soon for me to say that you know, things are going to get worse. I can't say that. I predict that there will be some bumps ups. We may have some peaks and valleys here. But I think we're on the right track.
Again, putting it in perspective.

Look at where we were in January and last December and where we are now.
And we have managed to stabilize at least that tremendous number of job loss. And I think that we're going to have to restructure our work force. The manufacturing industry has to change. It has to be competitive, it has to look forward to where there's going to be growth.
And I think green jobs, renewable energy is a path that we can look at.

CLAMAN: You get all of the anecdotal evidence, and among this evidence, we hear about employers asking employees to take unpaid leave, all kinds of stuff out there that is happening that is just devastating for people.

How do you begin to turn that psychology around? Are you meeting with businesses? Are you talking to them? What are you doing on a daily basis?

SOLIS: Absolutely. And as I travel around the country, I make it a point to meet with our local chamber of commerces and also industries that are looking for assistance from the federal government, because they may choose to expand their business.

So they want to know how they can begin to develop the work force, but also get capital or credit -- loosening of credit, so they can get into renewable energy. I just visited a plant in Ohio where we looked at different technologies, where people were once producing windshields, are now producing solar panels.

It's the same concept in terms of training -- just re-training a bit, but getting people into new jobs.

CLAMAN: Evolving (ph).

SOLIS: Yes. Yes.

CLAMAN: State budgets are failing, how tough it is. Ohio, of course, so bad. California, Michigan, people aren't spending. They're saving.
And the work week reached an historic low of 33 hours. How do you begin to move that needle to a healthier level?

SOLIS: Well, I think once we see all of the other evidence come about so that we can really see the recovery fully at work, that's when you'll start to see job growth, and you'll see the stimulus package working.

And it isn't just one part of, say, the Department of Labor, it's about other agencies and other efforts by the Treasury Department, by SBA, Small Business Administration, by Commerce, by Department of Energy, even Health and Human Services.

Everyone has a hand in here. So as we move together and we work as cabinet members coordinating our efforts, I think -- and Department of Transportation, we're going to see, you know, a lot of jobs created in the construction industry, where you saw the biggest fall in terms of people being laid off.

CLAMAN: That's where I want to really drill down here, with the stimulus, construction jobs, manufacturing, the June jobs number intensifies pressure, I think, on you and the Obama administration, that would be a natural assumption, to really prove that the jobs that were promised for stimulus will get out there more quickly.

SOLIS: Right.

CLAMAN: Are you talking to anybody at the administration to say, can we speed up this process?

SOLIS: We all are. We all are. And I can tell you already that just in the infrastructure funding, there are about 20,000 programs that are projects that have already been approved, and about 6,000 are in construction.

So I can tell you that this is -- as we speak, is happening on the ground.

CLAMAN: There was so much talk about the shovel-ready projects back when the stimulus was floated. And now people are wondering whether it is enough. Then you have the comments from Vice President Biden this weekend, which leads everybody to ask, are we going to need a second stimulus plan?

SOLIS: You know, I haven't exhausted all of the money that I'm supposed to give out yet. So I can't give you any answer to that right now because we're still rolling out our money. I still have $250 million that I have to roll out for jobs in health careers and IT.

And there are still other programs that we're starting to ramp up that we want to couple together so we can get more bang for our dollar and hopefully incentivize these programs now to start looking at retraining people in a green economy.

So that's a major priority for us in this administration.

CLAMAN: So you're saying, let's let the first chunk of money get to work first?

SOLIS: You don't start spending, you know, when you still have some other commitments. And you still have moneys that are going to be encumbered, so to speak, for different programs. Let's get that out the door. Let's make sure we're doing the right thing and aren't just throwing, you know, things out there.

We've got to be very, very systematic in how we do this and how we approach it. The public demands it. And they want to know that we're spending the money appropriately and that we're accountable.

CLAMAN: There are critics out there who are almost in a way pushing us along, saying, oh, they're going to need more because unemployment, it's so high and will probably get higher. And some of these people are the same people who were critical of the first stimulus, but are now demanding to know where are the jobs that were supposed to come from that stimulus.

Do you get frustrated with the critics who are out there? And what would you say to them?

SOLIS: You know, I try to put some of that aside because we're talking about people's lives. And there are so many people that I've come across that are telling me, Secretary Solis, I'm happy that this administration is prioritizing my needs. I have been out of work for maybe two years, and looking for new opportunities.

Now that I hear that there are some job training dollars available through the Workforce Investment Act and through other efforts like the green collar jobs, you know, moneys that are going to be out there, people are saying, thank you for the investment in me and my family.

CLAMAN: By the same token, they are worried about the deficit. If you polled people now, it's climbing, the percentage of people who list the budget deficit as it balloons as one of their top concerns.

Having a second stimulus would only add to that. So just to be clear, you're saying, let the first chunk of stimulus get through the system first...

SOLIS: Yes.

CLAMAN: ... before we even start talking about a second?

SOLIS: I would -- in my opinion, I think it would be wise to go ahead and extend all of the dollars and -- that we have already set aside that have been approved by the Congress. Congress is elected by the public.
The public also supported this effort.

So I think we have to think about, yes, it's important that we help the public get back to work, and part of it might mean that you have higher costs that you're going to incur, like anything else.

But if we didn't do this recovery program, if we didn't do the stimulus, I think unemployment would be a lot higher and you would see a lot more people out on the street.

CLAMAN: One of the traits of this recession that will probably be written about for years is sort of how there is this disparate impact on men. They're calling it not the recession but the "he-cession." More men have lost their jobs.

In fact, since December, 80 percent -- 83 percent of the jobs that have been lost are point-pinned (ph) on men. And of course, that's traditionally the heavy duty manufacturing and the construction jobs...

SOLIS: Right, construction, right.

CLAMAN: Yes, where we saw the two areas of growth were health care and education, traditionally female-oriented. What is the Obama administration and your office doing to address that situation?

SOLIS: Well, I can tell you that right now we're looking at this from different approaches. And one is where get the infrastructure money out right away so that we can repair those roads, those bridges, and any infrastructure sewage systems that have to be repaired that have been neglected for decades.

So we're talking about a major -- somewhat public works project, but it's also public-private. We're looking at transportation. We're looking at speed rail, all of these new innovative technologies that are going to help us take us into the 21st Century work force.

So I'm a little bit more optimistic, maybe that is viewed unfavorably by our foes, whatever. But all I can tell you is, is that I'm convinced that once these recovery dollars do hit our communities in the appropriate way, and we have appropriate staff trained up for these jobs, we're going to be well on our way to recovery for hopefully the next few years, and not just a short-term approach.

Because I think that's really important. We're not looking at just a quick fix here, we're looking at something that is going to take us out of this bad economy for the next decade. And we have to make these investments that were neglected in the last eight years.

CLAMAN: A lot of impatience out there. It took us a long time to get where we are today.

SOLIS: Absolutely.

CLAMAN: Take us a while to get out. You probably have the toughest job of any labor secretary since Frances Perkins, who was, of course, the labor secretary during the Great Depression. Is it harder than you thought it would be? Is it the same? Are you surprised by anything?
What is it like being you right now at a time when all of the focus is on the job situation?

SOLIS: It's a challenge. But it's a challenge that I take very seriously and I know that there are a lot of people counting on me. And I know that everything that I do, every decision I make is going to be weighted so enormously by so many people, by our critics.

But, I think again, when I go out, at least I have the luxury of going out and visiting across the country. Those key areas that have been most impacted or have seen where progress has been made because the money they have been released from the stimulus program have gone out there.

So I see different things happening. But overall I would tell you this is one of the most exciting jobs I've ever had in my entire life.

(AUDIO GAP)

CLAMAN: In the early years of the Bush administration it was the defense secretary who had everybody breathing down his back. This time around it's you, the labor secretary.

Keeping that in mind, people want to know -- we understand you're a friend of labor, but, are you a friend to business, as well?

SOLIS: I would think so. I think, you know, you don't just arrive at becoming who you are by always being one-sided. I think being objective and having balance there has always been something that I have strived for. Unfortunately you have sometimes critics or different media groups that will attach itself to one segment of what someone is saying.

But if you look at my past history in public office I've always worked with business. Business is the engine that helps to make our economy strong. We need each other. Labor needs jobs, jobs need employees. So they have to be meshed together. And a lot of what we do, in terms of the Department of Labor, requires that partnership.

So I'm going to do everything I can to reach out to everyone.

CLAMAN: Big businesses, as well?

SOLIS: Absolutely. And I applaud those big businesses that want to work with us in partnership. I don't think there should be any peaks and valleys between us. I think we should be working together, especially because this economy is so far down the line right now. They even see that it's in their best interests to collaborate with us.

So, I open -- I have my arms opens to that and I want to be optimistic and work within and let them know how we can help enhance their business, their work force and help them understand where they can get resources to expand their businesses. Hey, it's not about just helping one segment. It's about helping everybody.

CLAMAN: Well it's funny because I think there's an impression of you that you're this activist on women's issues, on labor issues, environmental issues. And some business people are saying, wait a minute, I don't understand what Hilda Solis is all about.

If I were a big business person employing let's say, 200,000 people out there, what would you say to me?

SOLIS: I would say I would want to be able to help you become more efficient. And if there's a way that we could help expand your work force and the people who you and how we can help you with job training opportunities and maybe cut your costs in education and training -- because some businesses aren't even aware that the Department of Labor will do that with them in a partnership.

You'd be surprised. I visited this Texas firm, multi-million dollar corporation that sends their employees to specialized training that costs a lot of money that they could probably have worked out with us for a very, very minimal cost. And we could save them money, they could then hire more people and then provide more of their products to more people throughout the country.

CLAMAN: I wanted to ask you about the Employee Free Choice act which would establish an easier system for employees to join unions and labor organizations.

Do you have enough votes for that and would you push it forward this year?

SOLIS: Well, you know, I am not going to be determining whether there will be passage of a bill. A lot of that will take place at the level of the Senate and the House members. They're the ones that are going to have to figure out what changes or modifications might have to made to the legislation if at all. And if they have the votes.

CLAMAN: (INAUDIBLE) because people talk about the fact that a secret ballot system is at the heart of the American electoral process.

SOLIS: Right.

CLAMAN: And if you don't have that, then perhaps you don't have a fair outcome because there might be intimidation present from both sides.
From the business and management side and also the labor side.

SOLIS: Well, I think that this is going to be negotiated at a different level. Obviously it's something that the Senate is now looking at. I know there are people working behind the scenes to try to negotiate an agreement. And I look forward to seeing that something is resolved.

CLAMAN: Do you know that compromise may be the issue here?

SOLIS: I believe so. I believe so. And if we want to see something change that's the state of art -- to compromise.

CLAMAN: You've known some tough times. Some people might not know that you're the daughter of Nicaraguan and Mexican immigrants. And your dad worked at a battery plant where he got poisoning and he was very activist there. And your mom worked on an assembly line for Mattel for many years.

What did you learn from them that you brought on today in this office at this high post?

SOLIS: To value the work of workers, employees. To know that so many of them put their lives at risk for products that they produce or manufacture, that they work and give it their all. And that I think in many cases, the business community can look at that and also appreciate that because their success is based on their work force.

So I know that both are very important. But I also know that there should be respect and there should be protection in the work place. So you'll know waking up that if you go to work, you can come home at night. And I think that's something that for the last few years maybe we've somewhat lost sight of. The need for safety and protection in the work place.

Showing up to work is one thing. But working hard, putting in a lot of hours because you're dedicated to your job and you want to be respected, I don't think is a bad thing. I think that's an American value.

CLAMAN: It is. But business sometimes look at that and feels it might be twisted.

Are you a friend to businesses in that you would open your door to them and they could come and talk to you?

SOLIS: Absolutely. And I've heard from businesses as I've again, travel throughout the country, people that are leery about the changes that might occur and want to have some answers, want to know how they best can work with the administration on looking at how we work at a compromise or how we work this out so that there is a fair balance.

I don't think someone like myself is coming in to try to persuade someone that my way or the highway. No, that's not it at all. It's about compromise. It's about making adjustments. It's about getting to know each other, as well, because I'm sure people do have pent up ideas about who I am and maybe don't really have all the facts. And once they get to know me they'll probably say, gee, she's somebody I can work with.

CLAMAN: Now, there's a preconceived about you. Surely you know that you're a scary person.

SOLIS: Oh, my gosh!

(LAUGHTER)

CLAMAN: You know, to business. Totally wrong impression?

SOLIS: I think so. I think so.

I mean if you look at some of the past work that I've done in my own district, helping to find funding for major transportation projects that required working with private industry, construction and developers.
All of that is a part of your life.

Certainly was for me, worked on incentivizing the manufacturing base in our local area to see that we could draw biomedical firms and most cancer research opportunities by helping to build up the capacity of one of our premier cancer research organizations, like the City of Hope in Los Angeles County.

So there's a lot of things that if you look at my background you'll see where I have been a part of. And I think that what I'd like to say to the public is that we want to work with business. We want to make sure that they have the best employed (ph), that they have safe places of work and that we provide whatever technical assistance and training that businesses need and require that maybe we have not made available to them. Maybe they were scared to interact with the Department of Labor.

Now I'm saying talk to us. Let's work together. Let's see if we can plan a compromise here (ph).

CLAMAN: Let's go back to the unemployment numbers as we finish up here.
Joblessness feeds the protectionist beast. People get very nervous about free trade.

Where do you stand on free trade?

SOLIS: Well, I think that we can't -- we can't go backward. We have to move forward. And what we should be looking at with the Department of Labor here is to make sure that we have the full protections, not just for our workers, but also for foreign workers, so we don't lower wages internationally and we make sure that we do not violate any major trade agreements that violate labor laws of exploitation of workers.

That's where I'm coming from. I want to see that we can reach those kinds of compromises. I think that, you know, as we move forward, we'll be taking a closer look. We want to look at data. We want to look at research. We want to help those companies abroad, as well, understand what -- what standards we would like to achieve.

CLAMAN: OK, but I -- I need to press you on this tariffs. Would you be for tariffs, because, you know, you go back to Smoot-Hawley during the Great Depression, people would argue that that's what caused the Great Depression. Twenty thousand products had heavy tariffs put on. It was a very protectionist measure.

SOLIS: I don't think we're in a -- in a period where we're going to see that level of activity. Inherent. I hope not. That's not what I see
-- I foresee for the future.

Right now, we have many existing trade agreements. Some are good and some can be greatly improved upon. And that's what my role is going to be. It isn't just Department of Labor, but we'll see the U.S. trade representative, we'll see Commerce, we'll see the secretary of State involved.

So it's all about negotiations, as well.

So I hope to work with our partners and also with our -- our, you know, countries, our bilateral agreements that are already in existence, to make sure that they work well for us, but they work well for the workers of those countries, as well.

CLAMAN: I know it's a general term, but is it fair to say that you are pro-free trade, in essence?

SOLIS: I am for fair trade -- making sure that we do not abuse our workers and lose jobs at our expense, that we make sure that whatever we do, that we have a level playing field and that we're honest brokers and that those countries that we negotiate with, I hope, are also honest brokers with us.

CLAMAN: Let me push forward to the future.

One year from now, do you think, in general, American workers will feel better about their situation, worse or the same?

SOLIS: Again, I don't have a crystal ball. I would like to believe that we're going to improve the situation, though, because of the investment in (INAUDIBLE) and education and training, in green jobs, in the infrastructure money and the monies we've already given in education and for law enforcement. We've actually kept people from losing their jobs.

And I don't hear enough from the press talking about those good stories that are out there. I think that's something that is worthwhile that looking at, in terms of when we look at the whole process, what were we able to -- to keep in place; that people still have an ability to be protected by local law enforcement, that they still have school teachers in their classrooms; that we still have clinics that are open that people can go visit, because maybe they can't afford to go to see a private doctor, but they can go into a community health clinic.

CLAMAN: You're saying that stimulus money kept those people in their jobs?

SOLIS: Absolutely. Absolutely. And the unemployment insurance checks that people received are benefiting their local communities, because that money is being reused again in the local area. And that's why you see people spending a little bit more. They're putting away, but they're also spending.

And those are the figures that I've seen in the last two or three months.

CLAMAN: In typical media fashion, I'm mooching way more time and Carl
(ph) is probably having a fit. But as we finish up here, I was going to ask you about California, but I -- it's crazy times, because it's our state.

SOLIS: Yes.

CLAMAN: You know, I can't even believe what's going on there. But looking back at your childhood and here you are today in the Department of Labor, what is the thing that most amazes you about your climb to the top?

SOLIS: That America is really one of the greatest countries on this Earth and that people from humble beginnings can really make a change and difference in other people's lives given the opportunity and appropriate skills.

And in Spanish we say gana -- you know, that drive, that inner drive that makes you want to excel, that makes you want to get up every day and face whatever challenges there are, knowing that you may not be as successful but, you know, you're not -- you're not going to be viewed as doing the wrong thing if you continue to move forward, even though you may have bumps in the road.

Even though people put barriers and put up gates for you to not get in, you keep moving and plowing ahead. I think that's -- those are the values and those are the work ethics, I think, that I have come to understand and appreciate. And it's just given me more insight into what I need to do to help, hopefully, provide a pathway for people to follow in terms of job training and opportunities for them and creation of jobs and businesses, expansion of businesses; but, also, the hope and desire of the many young people out there, who maybe came from the same humble beginnings that I did but could say to themselves, look, I, too, one day can do that. I, too, want to be a secretary of Labor or Defense or State or maybe aspire to be the first CEO for a major business in renewable energy.

Being a female, I think it's really important for us to also project that we can do the job, because we -- we know that we're not well represented in the high Fortune 500 positions and even in the federal government. We have a long way to go.

But thank goodness that this administration believes in expanding opportunities to give people a chance to do that.

CLAMAN: People might not know that you worked under Ron Reagan in the Office of Management & Budget.

What did you learn from that experience that's actually helping you today?

SOLIS: It helped me to understand that -- that there are forces out there that may not look at government as the -- the only solution. And so you do have to seek out other opportunities and other opinions and work with -- and work with what you have, but also help create opportunities and network with other -- other individuals.

So businesses, yes, they're very important. Talking to people that may not necessarily want to hear what you have to say, reaching out to them and making yourself available, I think, is very important.

CLAMAN: Do you draw upon your time working in the Reagan administration for any of the challenges that you face today?

Was there something that President Reagan did that you learned from in that regard?

SOLIS: I knew that I wanted to go -- go back home to California and really focus in on -- on my career as a public administrator. That's what I was trained in. That's what my master's degree is in -- working to help improve the lives of people.

At that -- at that point in my life when I worked in the OMB -- and I was a civil servant, I wasn't a political appointee. I felt that I could better serve my community by going back and helping people get educated, if I ran a state program that would help youth, particularly disadvantaged youth, have an opportunity to seek higher education.

And I was able to do that. And I had a lot of gratification and joy from doing that. And, as a result, I ended up running for a local community college board, Rio Hondo College, and was one of the first Latina women in that area to ever run for a position.

So we started breaking ground in new areas just by little simple -- simple embroadening -- getting involved in education, they're going to see that, you know, if I could make it, I -- I thought, my goodness, how many more people could do what I -- what I went through if they had the tools and information. And I think that...

(CROSSTALK)

SOLIS: And that's what I -- I had tried to do in my life, really share and impart -- the successes I have isn't just due to my own initiative.
There have been other people in my life who have helped me, like a former high school counselor, who encouraged me to go to college when I thought, gee, I'm going to graduate, I'll just become a secretary.
That's it. That's what -- that's what they had me tracked for.

But I had another counselor, Mr. Sanchez (ph), who said, Hilda, you have much more to offer, and I can help you with financial aid.

Because I come from a big family, there is seven of us. Parents were working in manufacturing and assembly line. They didn't have the money to send their kids to college.

But this counselor convinced me to think about what I could do to change my life. He gave me that hope. He believed in me. I went through the process and as a result, now I'm the secretary of labor.

CLAMAN: Yes. You're not a secretary...

SOLIS: Not -- yes.

(LAUGHTER)

SOLIS: That's right. So I'm very proud of the people that have helped to influence and shape me: my parents, obviously people like Mr.
Sanchez, but other people that have been good mentors, role models.

And they haven't all been women. They've been from different genders and different sexes and different ethnicities. Some of my best professors were minority, African-American and Puerto Rican at the university that I attended, the Cal State University.

It really influenced me and said, you know, Hilda, think outside, challenge yourself. I would have never heard that from my home. I mean, because no one went to college. My parents didn't -- were not college-educated.

But to hear it from someone else, and then you start thinking about, gee, maybe I can do this after all, is something that I think a lot of us may not know how important those incidents that occur your life really can help to shape and form who you're going to be later on.

CLAMAN: Thank you so much. I could talk forever...

The 9 mm pistol that the late Saddam Hussein was carrying when American forces found him hiding in a "spider-hole'' in Iraq is among the many artifacts that curators are assembling for the new George W. Bush Presidential Library going up in Texas.

This museum piece may serve to remind many of the Iraq war opponents and critics of the construction of the presidential library at a Methodist Church-owned college campus in Dallas of what they opposed in the first place.

It's only one of many museum pieces in a Bush collection being assembled at a warehouse not far from Southern Methodist University. Where the 43rd president's library, museum and public policy institute will be constructed.

They include a Texas Rangers baseball jersey autographed by pitcher Nolan Ryan - Bush served as managing partner of the team before election as governor of Texas -- and a framed mosaic of St. Peter's Basilica from the pope whom Bush visited at the Vatican.

The $300 million presidential library and museum, being built with private donations, will be the nation's 13th and the third in Texas -- Bush's father has one at College Station, Lyndon Johnson's is in Austin.

"It's a wonderful eight-year time capsule," Jennifer M. Schulle, the registrar for the Bush library, says of the collection. "It's everything that was going on -- politically, personally and socially."

Some 40,000 artifacts and 65 million documents are being stored at the warehouse, including 100 terabytes of electronic records, by far the largest of any presidential collection, as Bush was the first administration that operated entirely during the era of e-mail.

The conveyance of all this from Washington to Texas, conducted by the Air Force, required 16 18-wheelers and three planes.

"It's a colossal amount of material," says Shannon Jarrett, the library's supervising archivist. "We won't get to all of it in our lifetime."

"The documents and records are filed in labeled boxes stacked neatly upon rows of shelves in different vaults within the warehouse,'' the AP reports. "There are 79 boxes labeled presidential letters and correspondence. Other boxes contain records from the desk of political adviser Karl Rove and Chief of Staff Josh Bolten. It's the kind of place where you might expect to stumble across the Ark of the Covenant. ''

The National Archives and Records Administration has a legal mandate to preserve every presidential record, which covers anything produced by White House staff. A handwritten note scrawled on a cocktail napkin qualifies as a presidential record. So does a draft copy of a State of the Union address.

Even Christmas decorations, including trees and holiday-themed paintings, wind up in the warehouse. There are boxes full of presidential cuff links, crayons and pens.

Most of the records and items will never be seen by the public, stored off-limits in parts of Bush's presidential center. Those that eventually are displayed will reflect the four broad themes on which Bush's private foundation wants to focus the exhibits: freedom, opportunity, compassion and individual responsibility.

The Associated Press contributed to this report.

"Politically speaking," Alaska's lame-duck, gone-fishin' Gov. Sarah Palin says, "If I die, I die. So be it.''

But a lot of Americans aren't ready to let go of the resigning governor, stepping down later this month with 18 months left in her term, citing the "insane'' business of dealing with consuming ethics complaints back home in the aftermath of her brief stint on a national stage as the Republican 2008 vice presidential nominee.

Palin says that she cannot say what the next few years will bring - no more than what the next fish run holds.

But four in 10 Americans surveyed say they could vote for the Alaskan for president - with just 19 percent saying they would be "very likely" to vote for her should she run, and another 24 percent saying they'd be somewhat likely to do so.

The Gallup Poll's Jeffrey Jones suggests that this offers Palin " a decent reservoir of potential support to build upon. ''

At the same time, 41 percent of those surveyed this week in the wake of Palin's surprise Fourth of July weekend resignation say they would be not at all likely to vote for her. And 13 percent say they'd be "not too likely'' to vote for her.

As a benchmark on this question, consider what Gallup asked in 2005 about Hillary Clinton running for president: 52 percent of registered voters surveyed said they were at least somewhat likely to vote for her, including 28 percent who said they were very likely to do so.

"Predictably, most Democratic registered voters (70 percent) say they are not at all likely to vote for Palin,'' Gallup reports. "While most Republican registered voters (72 percent say they are likely to vote for Palin, only about half of these (35 percent of all

Republican voters) can be considered solid supporters who say they are very likely to support Palin at this time.''

Should Palin shy away from a bid for the White House, Gallup's Jones notes, "her high profile may allow her to take on a role as a major national political figure. When asked about her possibly having such a role, 39 percent of Americans say they would like to see her do this, including 67 percent of Republicans, 34 percent of independents, and 18 percent of Democrats.''

If Palin has positioned herself at odds with the national news media, a lot of people also think the governor has gotten poor treatment. The survey shows that 53 percent see the news media's coverage of Palin as "unfairly negative," while just 9 percent say it has been "unfairly positive" and 28 percent say "about right.''

The survey of 1,000 adults was conducted Monday and carries a possible margin of error of plus or minus 3 percent.

The president arrived in Rome this morning to meet with Italian leaders and prepare for the G-8 summit taking place this week at L'Aquila, in a region struck by an earthquake in April - the president planned to tour the damaged area today.

Michael Froman, the president's point man on the G8 summit, said this morning that there is a "consensus view" among the nations' leaders that "we are still in the midst of an economic downturn," and that world leaders were not planning any mass exodus from their shared plan to stimulate recovery.

Leaders have said "it's time to prepare exit strategies," Froman said, "but not necessarily to put them into place yet."

World leaders gathered in L'Aquila for a noontime luncheon and then a series of meetings on issues ranging from the global economy to nuclear nonproliferation and food security.

Obama will preside over a side meeting of the major economies with a focus on climate issues. That summit has suffered a setback with Chinese President Hu Jintao's return home to deal with deadly rioting in Xinjiang.

But White House officials said that meetings today and tomorrow still can be productive, and Froman rebuffed suggestions that the Italian hosts have not put together an organized session. He denied reports that the U.S. had called an emergency meeting of the summit's "sherpas'' to take charge of the session.

""The Italian presidency has done a terrific job preparing for the summit," Froman said. "The Italians defined an agenda early on and worked methodically" on it.
"The way the G-8 works,'' he said, is "we all do our part."

On the Chinese leader's departure, White House spokesman Robert Gibbs said, "It's our understanding that he's gone back to China, so it appears as if he won't be there to meet with the president, but we will have a delegation meet with their delegation.''

Asked about what the U.S. is willing to support as part of any G-8 commitment to combating global warming, Gibbs said: "The biggest thing ... are the big steps that the House took only a week or so ago to put our country strongly on record as taking bold action against forces that are changing the temperature and the environment of our planet...''

The House has narrowly passed a bill demanding caps on greenhouse gas that industry emits, enabling polluters to purchase the rights for emissions from others to encourage the development of alternative sources of energy such as wind and solar power. The measure faces a battle in the Senate, however, with Republicans criticizing a plan that will add to the cost of household energy bills over time as a "national energy tax.''

"There's important progress that we can make as a part of this in creating a market for clean energy jobs...,'' Gibbs said. "So I think we've taken a strong step forward... Our biggest contribution to this is the steps that were taken by the House to put us strongly on record on this...''

Asked how the administration will define success on climate change at the G-8 summit, Gibbs said, "In many ways success for us is going to be getting something through Congress and to his desk that puts in place a system, a market-based system that lessens the amount of greenhouses gases in the air....''

Christi Parsons reported from Rome. Mark Silva reported from Washington.

President Barack Obama, interviewed in Moscow today, said that his vice president's assertion that Israel is a sovereign nation and cannot be told what to do, or not to do, about Iran's nuclear program is "absolutely not'' a green light for a preemptive attack against Tehran's nuke plants.

"Absolutely not,'' Obama told CNN's Ed Henry. "And I think it's very important that I'm as clear as I can be, and our administration is as consistent as we can be on this issue.

"Vice President Biden stated a categorical fact which is we can't dictate to other countries what their security interests are,'' Obama said of Joe Biden's remarks in an interview with ABC News in Baghdad over the weekend.

" What is also true is that it is the policy of the United States to try to resolve the issue of Iran's nuclear capabilities in a peaceful way through diplomatic channels,'' Obama said. "We are committed to a peaceful resolution to this conflict and I think it is still possible, but ultimately if we present an opportunity to the Iranians at some point, they've got to seize that opportunity.''

On this day of memorial services for singer Michael Jackson, whose followers have turned out in droves in Los Angeles, Obama, who had not had much to say publicly about the musical icon, had this to say:

"I do not think there was any doubt, he was one of the greatest entertainers of our generation, perhaps any generation,'' Obama said. "I think like Elvis, like Sinatra, like The Beatles he became a core part of our culture.

"You know, his extraordinary talent and his music was matched with a big dose of tragedy and difficulty in his private life and I don't think we can ignore that,'' the president said. "But it's important for us to affirm what was the best of him and that was captured by his music, music that Michelle and I listened to from the time we were little kids.''

See the full comments from the interview with President Obama below the fold, courtesy of CNN:

ED HENRY, CNN SENIOR WHITE HOUSE CORRESPONDENT: Thank you, Mr. President. Obviously, a grueling trip. What's it like though? Does it take the edge off having, not just your wife, but your daughters here as well visit the Kremlin tag along for what must be a pretty exciting trip?

PRESIDENT BARACK OBAMA: You know it makes a huge difference. The girls are a just enjoy. Sasha this morning around 4 a.m. just wandered into our bed and plopped down and started chatting. That was sort of a highlight. Although I'm a little groggy now as a consequence. But you know having her and Malia being able to see the world and then report back to us on what they are seeing. And then Michelle just, she's always, she's a star at home and abroad.

HENRY: You finally got a chance to look into Vladimir Putin's eyes, did you see into his soul and why did you say before this trip that he's got one foot in the old way of doing business, and one foot in the new way of doing business? What was the purpose of that?

OBAMA: Well you know I think a lot of ways Prime Minister Putin is representative of Russia. I mean he is very popular here. I think that Russia is still on the one hand in the process of transitioning out of the Cold War and the dissolution of the Soviet Union. On the other hand they recognize an interest in modernizing, diversifying and recognize I think that economic power is going to be the most important currency in the 21st century. I found him to be tough, smart, very unsentimental. I think he's a practical person and to the extent that there are common interests like fighting terrorism, potentially nuclear proliferation, where he believes working with the United States advances Russian goals. I think he can be a potential, a potential partner.

HENRY: Some Iranian clerics came out yesterday raised more questions about the disputed election. How do you engage a government that doesn't seem to maybe want to be engaged and may even be thumbing its nose at democratic values?

OBAMA: Well I think it's a problem. And I've said this earlier, our theory has consistently been to present a door of opportunity for Iran, to have its sovereignty respected to join the community of nations more fully. But the events that we've seen over the last weeks haven't just disturbed us in America, they have disturbed the world. You know, violence, detentions have been I think not only heart breaking but really raise questions about the direction Iranian leaders want to take their country and have obviously raised issue of legitimacy that haven't yet been settled in their own country. We have to wait and see how dust settles. Right now what we have to do is to continue to speak out and bear witness to the fact that the Iranian people need to be treated with justice and fairness. But it certainly complicates our efforts because there is the possibility that those who now are in power in Iran choose to retrench and dig in rather than open up. And that's where having conversations with Russia, China, other countries that still do business with Iran is so important. And it's something I raise consistently in conversations here.

HENRY: On Iran over the weekend, Vice President Biden seemed to leave, sort of suggest that the United States would not stand in the way if Israel wanted to launch a pre-emptive strike against Iran's nuclear sites. Are you giving Israel a green light?

OBAMA: Absolutely not. And I think it's very important that I'm as clear as I can be, and our administration is as consistent as we can be on this issue. I think Vice President Biden stated a categorical fact which is we can't dictate to other countries what their security interests are. What is also true is that it is the policy of the United States to try to resolve the issue of Iran's nuclear capabilities in a peaceful way through diplomatic channels. That is our policy, I have been talking about this for the last two years, we are going to continue to pursue this, and you know we have said directly to the Israelis that it is important to try and solve this in an international setting in a way that does not create major conflict in the Middle East. Now this is a tough job and nobody is under any illusions that it will be easy, and I've always said that we, the United States, preserve the right, and I as the commander in chief preserve the right to take whatever actions are necessary to protect the United States. But we are committed to a peaceful resolution to this conflict and I think it is still possible, but ultimately if we present an opportunity to the Iranians at some point, they've got to seize that opportunity.
HENRY: Last question. Millions of people around the world are about to watch the funeral of Michael Jackson back in the United States. What do you think his legacy is going to be?

OBAMA: Well you know, he, I do not think there was any doubt, he was one of the greatest entertainers of our generation, perhaps any generation. I think like Elvis, like Sinatra, like The Beatles he became a core part of our culture. You know, his extraordinary talent and his music was matched with a big dose of tragedy and difficulty in his private life and I don't think we can ignore that. But it's important for us to affirm what was the best of him and that was captured by his music, music that Michelle and I listened to from the time we were little kids. I remember listening to ABC when I was eight or nine or ten and he kept on producing extraordinary music for years after that.

Bolten, who also happens to be a 1976 graduate of Princeton University, will join the faculty of Princeton's Woodrow Wilson School of Public and International Affairs for the upcoming academic year.

The organizational and financial wizard, who ran Goldman Sachs' legal and governmental affairs in London before becoming policy director for Bush's first bid for the White House, will serve as the Woodrow Wilson School's John L. Weinberg / Goldman Sachs & Co. visiting professor.

The former director of the White House Office of Management and Budget, who served as Bush's final chief of staff, will teach an undergraduate course on the federal budget this fall and two graduate seminars on the politics and practice of international trade and international financial regulation in the spring.

Bolten, 54, served the Bush White House for eight years, starting as deputy chief of staff for policy, then OMB director and finally chief of staff from April 2006. Bolten (pictured in a photo by J. Scott Applewhite / AP ) also had served during all four years of the first President Bush's term, mostly as general counsel to the U.S. Trade Representative.

As OMB director, he also presided over a then-record federal budget deficit, which has been far surpassed by his successors.
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Volunteering with an AIDS relief organization in Africa, he serves on the board of the ONE Campaign and the U.S. Holocaust Memorial Museum.

"I'm excited to follow my government career in a vibrant academic environment that's on the cutting edge of contemporary public policy thought," Bolten said in a statement issued by Princeton.

With a B.A. from Princeton and law degree from Stanford, he international trade at Yale Law School in the fall of 1993. Between the Bushes, he worked as executive director of legal & governmental Affairs, for Goldman Sachs International in London for five years.

He also drives a big motorcycle.

'I knew that everything changed on Aug. the 29th,'' says Sarah Palin, the resigning governor of Alaska who was chosen as the Republican Party's vice presidential nominee last year. "That was the day I was tapped.''

Reporters caught up with Palin at "a remote fishing village'' in Alaska where husband Todd Palin's family has run a commercial fishing operation for years, a favorite Fourth of July weekend resort for Alaska's first family -- which became a lame-duck first family on the eve of the Fourth, when Palin abruptly announced her resignation..

Allowing that she may not have political staying power after her surprise resignation Friday, Palin told Kate Snow on ABC's Good Morning America: "I said before ... 'You know, politically speaking, if I die, I die. So be it.''

NBC's Andrea Mitchell offered this account this morning, asking Palin, wearing overall waders and jumping out of a boat on a beach 300 miles from Wasilla, if, now that she is stepping down as chief executive 18 months before the end of her first term as governor, she can envision herself running for president in 2012:

"I don't know what the future holds,'' said Palin, smiling on the shore of the remote waters of her home state. "Can't predict what the next fish run is going to look like, much less what's going to happen in the next few years....''

So why he she resigning on July 26?

"I knew that I wasn't going to run for election,'' Palin said. "The choice I had to make was how I was going to react.''

She cited "the political game that's being played right now,'' all of the ethics complaints that her administration has had to defend against since she returned to Alaska as the failed GOP vice presidential nominee. ""I think that some people may not be fully aware of all the conditions. We have sat down with many reporters and we have shown them how it has cost thousands of hours in time and thousands of dollars.''

She personally has "a legal bill of about a half million dollars, but that's not the consideration,'' said Palin, who also has a book deal that should be worth a few million dollars to her next year. "The consideration is how it affects the state....''

pretty darn independent, and not get wrapped up into a strong political machine that hasn't been extremely successful in some ways."

In the media swarm around Palin out there in the salmon-fishing grounds, the outgoing governor told Dan Springer of the FOX News Channel: ""I do not know what the future holds...

""I want to work, right now, for people who are going to work in office or out of office for the right things,'' Palin said. "Those principles that built up America, those who are inspired by the values of America, and will not deride or apologize for the values we hold as Americans. I'm gonna work for those people."

"Knowing I was not going to run for reelection... I knew I wasn't going to run again, so I was going to be honest with Alaskans,'' she said, pressed about quitting in the middle of the stream. "You're not listening to me...''

Was it difficult to readjust to 'the nitty gritty'' of government in Alaska following the brief national run that she enjoyed last year? "You mean like the fish slime and the dirt under the finger nails?'' she replied. "No... I am a fighter, I thrive on challenge.''

The family "vote'' cast for the resignation was unanimous, Palin has said.

And Todd Palin, who now has become a lame-duck "first dude,'' told Mitchell the family has "no doubts at all.''

President Barack Obama and friends at the FOX News Channel are talking about the president's meetings with Russian leaders - Obama meeting with Prime Minister Vladimir Putin today in Moscow, following his meetings with President Dmitry Medvedev on Monday.

The question remains, who's running Russia?

"I think that President Medvedev is my counterpart, the president of Russia,'' Obama told FOX's Major Garrett, during an interview in Moscow which started airing on FOX and Friends this morning and will continue throughout the day on FNC. "The prime minister, who I just met today, obviously still has enormous influence.

"Interestingly,'' Obama said, "nothing Putin said contradicted anything that Medvedev has said. It was consistent."

Having suggested before the start of this trip that Putin, the former president who so famously struck up a relationship with former President George W. Bush only to see the two nations' relations deteriorate by their terms' end, still had one foot stuck in the Cold War, Obama said this today in the interview with FOX:

"I think he would admit that his formative years were shaped on the cold war and that some of his continued grievances with respect to the West are still dated in some of the suspicions that came out of that period... I think he genuinely would like to see U.S.- Russians relations improve.''

While FOX's commentators have longed for a chance to sit down with the president, this interview was strictly news business: Obama had spoken with FOX News Sunday's Chris Wallace earlier in his term, and now Garrett on the road. Obama was forthcoming about his impressions of Putin following today's meetings.

More on Putin:

"I think as I said before,'' Obama said of the former KGB chief, "his formative years came out of that period....

"I found him to be tough, smart shrewd , very unsentimental, very pragmatic,'' Obama said of Putin. "And on areas where we disagree, like Georgia, I don't anticipate a meeting of the minds anytime soon... On areas where we have common interests, like fighting terrorism, I think that there is great potential for us to do some work together."

Al Franken -- the former comedian who won a bruising, eight-month vote recount and court battle in Minnesota -- arrived on Capitol Hill on Monday, a day before he was to be sworn in as a new Democratic member of the Senate.

But Franken immediately downplayed the importance of his vote in the Senate.

"A lot has been made of this number 60," Franken said. "The number I'm focused on is the number two. I see myself as the second senator from the state of Minnesota."

Franken's victory would seem to hand Democrats their long-desired 60-vote supermajority -- counting the two independents who caucus with them. Sixty votes would allow Democrats to defeat any Republican filibuster attempt and clear the path for legislation on energy, healthcare, immigration and other issues.

But it isn't likely to play out that way.

For one thing, two Democrats, Sens. Robert C. Byrd of West Virginia and Edward M. Kennedy of Massachusetts, are sidelined by serious illness, casting doubt on their availability for roll-call votes.

For another, several moderate Democrats are expected to have reservations about the energy legislation, which will seek to cap industrial carbon emissions, and the healthcare bill, which is expected to contain a government-sponsored insurance plan that would probably draw opposition from insurers and business groups.

That means a handful of Republican votes could be necessary to pass any sweeping piece of legislation.

See the full story on Franken in the Senate in Tribune newspapers and here in the Swamp. Photo of Sen.-elect Al Franken, above, right, and Senate Majority Leader Harry Reid (D-Nev.) by Cliff Owen / MCT.:.

Senate Majority Leader Harry Reid (D-Nev.) intimated as much at an event Monday welcoming Franken, saying Republicans would have an opportunity to help shape the agenda.

"Democrats aren't looking at Sen. Franken's election as an opportunity to ram legislation through the Senate," Reid said. "In turn, Senate Republicans must understand that Sen.-elect Franken's election does not abdicate them from the responsibility of governing."

Reid and Franken met for about 20 minutes to discuss upcoming Senate business, which is expected to include an intensive focus on the healthcare bill. Franken will be formally sworn in today in the Senate chamber.

Franken's committee assignments ensure that he will be thrown into the middle of two of the highest-profile debates in Congress.

He will work on healthcare as a member of the Senate Health, Education, Labor and Pensions Committee. As a member of the judiciary committee, he will participate in the confirmation hearing for Supreme Court nominee Sonia Sotomayor, set to begin next week.

Franken will take over the office vacated by Norm Coleman, the outgoing GOP senator from Minnesota.

Robert S. McNamara, the former secretary of defense for two presidents who only late in life acknowledged that he and his colleagues were "wrong, terribly wrong'' in the prosecution of the war in Vietnam, passed away today at the age of 93.

He had served as secretary of defense for Presidents John F. Kennedy and Lyndon B. Johnson as the U.S. military escalated its forces in Southeast Asia in the 1960s. Before the U.S. pulled out of Saigon in 1975, American forces lost 58,000.

"The problem was that we were in the wrong place with the wrong tactics,'' McNamara allowed 20 years later.

McNamara had served as president of Ford Motor Co., before joining the Kennedy administration in 1961. And for 13 years after leaving Johnson's Pentagon in 1968, he served as president of the World Bank.

Remembered as brilliant and compulsive, with a work ethic that carried him from modest circumstances in California to the pinnacles of power in Washington, he retired from the World Bank in 1981 but maintained a busy director's and consultant's life.

The domestic protests that the war in Vietnam stirred in the U.S. drove one president from office and consumed the campaign of his would-be successors. The ultimate failure of the U.S. intervention in Southeast Asia to prevent a Communist takeover of South Vietnam also left the morale and image of the American military weakened for years - the "lessons of Vietnam''shaping military and political strategies for decades to come.

In his 1995 memoir of the war, In Retrospect: The Tragedy and Lessons of Vietnam, McNamara said that he and his colleagues were "wrong, terribly wrong" to pursue the war as they did. He acknowledged that he failed to force the military to justify its strategy and tactics, had misunderstood Asia in general and Vietnam in particular, and perpetuated the war long after he realized it was futile.

The AP contributed to this report. See an excerpt about the press's impact on the war below, and see McNamara's discussion of his book above, courtesy of C-SPAN.

C-SPAN: What did you think the impact of the press was?

McNAMARA: "Well, I think two things. Number one, this was the first war -- and people don't understand this to this day -- the first war in which the press acted without censorship, and I think that was good.

The second point is that many people today -- and I've heard it expressed within the last week or so -- believe that, well, it was the press that lost the war, that if they'd just kept their mouth shut, the people wouldn't have turned away from it and we'd have had the American people behind it and we could have won. That is totally wrong.

We were fighting -- and we didn't realize it -- a civil war. Now, true, obviously there were Soviet and Chinese influence and support and no question that the communists were trying to control South Vietnam, but it was basically a civil war.

And one of the things we should learn is you can't fight and win a civil war with outside troops, and particularly not when the political structure in a country is dissolved. So it wasn't the press that was the problem. The problem was that we were in the wrong place with the wrong tactics.''

North Shore Republican Rep. Mark Kirk, who has been contemplating a costly run for the U.S. Senate or governor, reported today that he has built up a campaign warchest of more than $1 million.

Kirk raised more than $580,000 during the second quarter of the year, according to a statement his campaign released. Such a fundraising performance is robust by the standards of U.S. House members but lags slightly behind the amount of money Kirk raised during the same period in the last election cycle.

A statement released by spokesman Eric Elk described the results as "on pace" with Kirk's fundraising during the second quarter of last election cycle. Kirk raised $606,000 during the second quarter of 2007 and had accumulated a balance of $1.1 million at the end of the period.

During the last election cycle, Kirk was among the most prodigious fundraisers in the U.S. House outside of the party leadership, drawing on a support base in a wealthy region to defend a swing congressional district fiercely contested by the opposition Democrats.

The statement from Kirk's campaign described this year's fundraising as "strong" given the economic recession.

"I am humbled that during these difficult economic times, our support is stronger than ever," Kirk said in a written statement.

With Republicans no longer in control of either the White House or Congress, GOP candidates generally also are having a more difficult time raising money than when their party wielded power in Washington.

Kirk is being encouraged by Republican party leaders to make a bid for either the U.S. Senate or governor in the 2010 election.

The campaign treasury Kirk has accumulated is particularly important should he choose to make a bid for the U.S. Senate because the money can be used in any federal campaign.

Federal campaign funds must comply with restrictive rules which limit contributions to $2,400 per person. Illinois state law does not impose limits on campaign contributions, making it easier to quickly amass funds for a run at a state office.

In a mid-April speech to the City Club of Chicago, Kirk had promised to make a decision on seeking one of the offices by the end of the month but then let the deadline slip and has yet to make an announcement of his intentions.

Kirk's campaign released the fundraising totals in advance of July 15 legal deadline for disclosing fundraising activity through June 30. The campaign did not provide data on individual contributors and expenses, which must be released by the deadline.