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THE SITUATION ROOM

Conflict Between President Bush and Congress; Female British Service Member Claims They Were in Iranian Waters; Interview with Barack Obama

Aired March 28, 2007 - 16:00   ET

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


WOLF BLITZER, HOST: Happening now, instead of Senator Barack Obama, what would happen if he were President Obama?
The Democratic candidate will be here for a one-on-one interview, discussing his opposition to the war in Iraq, and he's taking on Senator John McCain and President Bush in the process.

But what tough decisions would Senator Obama make as commander- in-chief?

Also, President Bush tells Congress he won't be pushed around and he says he won't let Congress hold war funds over his head as a way to force him to accept a timetable to withdraw U.S. troops from Iraq.

But the speaker of the House uses some choice words to respond.

And the only female among those 15 British service members seized by Iran is speaking out. She says her crew was picked up after they supposedly trespassed into Iranian waters.

But was she forced into saying that by the Iranians?

I'm Wolf Blitzer.

You're in THE SITUATION ROOM.

He wants to be president of the United States and he's blasting the current administration, Democratic Senator Barak Obama.

Moments ago, I spoke with him one-on-one the presidential candidate talked about the war in Iraq and he called the Bush administration "obstinate."

(BEGIN VIDEO CLIP)

SEN. BARACK OBAMA (D), ILLINOIS: The problem is, is that you've got an obstinate administration that has shown itself unwilling to change in the face of circumstances on the ground(END VIDEO CLIP)

BLITZER: So what would Senator Obama do to handle Iraq if he became President Obama?

He answers that question in our full interview.

All of that coming up here in THE SITUATION ROOM. Another item Senator Obama is talking about involves President Bush's vow to veto those war funding bills passed by the House and Senate. Mr. Bush says he won't be forced into accepting the troop timetable for a withdrawal and he's accusing Democrats of meddling in Iraq War policy.

Our Congressional correspondent, Dana Bash, is on Capitol Hill.

But let's go to the White House.

Ed Henry, our correspondent, is standing by -- some tough words today, Ed, from the president to the Democrats in Congress.

ED HENRY, CNN CONGRESSIONAL CORRESPONDENT: That's right, Wolf.

We've heard this threat already from the president, for the White House over and over. What was new today is that the language, the rhetoric got much more strident.

(BEGIN VIDEO TAPE)

GEORGE BUSH, PRESIDENT OF THE UNITED STATES: Not a bad introduction by a cowboy.

HENRY (voice-over): As the president addressed the National Cattlemen's Beef Association, a bit of the Bush swagger was back.

BUSH: Now, some of them believe that by delaying funding for our troops they can force me to accept restrictions on our commanders that I believe would make withdrawal and defeat more likely. That's not going to happen.

If Congress fails to pass a bill to fund our troops on the front lines, the American people will know who to hold responsible.

HENRY: The president accused Democrats of meddling with military strategy and vowed again to veto any bill that sets a spring 2008 timetable for bringing U.S. troops home.

BUSH: It's unclear what the military significance of this date is. What is clear is that the consequences of imposing such a specific and random date for withdrawal would be disastrous.

HENRY: Mr. Bush also lampooned pork projects loaded up in the war funding bill.

BUSH: There's $3.5 million for visitors to tour the Capitol and see for themselves how Congress works. I'm not kidding you.

HENRY: And he used an unconventional example to claim progress on the ground.

BUSH: I want to share with you how two Iraqi bloggers -- they have bloggers in Baghdad just like we've got here -- describe it. Displaced families are returning home. Marketplaces are seeing more activity. Stores that were long shuttered are now reopening. We feel safer about moving in the city now.

(END VIDEO TAPE)

HENRY: Now, it seems somewhat ironic for the president to be citing bloggers to defend his policy in Iraq. This is a White House, when you approach them with information from anonymous sources, they often get upset and say, look, we're not going to respond to that.

But today, the White House insisting and defending the use of the bloggers by saying look, these are two brothers who are dentists in Baghdad. They've written a blog that's been cited by media outlets like the "Wall Street Journal." And they say the president is going to use any means he can to defend his policy -- Wolf.

BLITZER: You talk about a little bit of that Bush swagger being on display earlier today, but he realizes that he suffered a serious political setback in both the House last week and the Senate yesterday.

HENRY: No doubt about it, Wolf.

The bottom line is that the White House believes that they can win a veto showdown with Democrats on the Hill because, as everyone knows, the Democrats, at this point, do not have the votes to override a veto. That's the bottom line on the map.

But the other bottom line is that a growing number of people on Capitol Hill, mostly Democrats, but also a small, increasing number of Republicans, are turning against the president's policy. That is not good for the president -- Wolf.

BLITZER: Ed Henry at the White House.

Stand by.

Suggestive of the showdown that it is, Nancy Pelosi says, and I'm quoting now: "There is a new Congress in town."

Our Congressional correspondent, Dana Bash, has more from Capitol Hill -- so how are Democrats reacting to this latest veto threat, Dana, from the president?

DANA BASH, CNN CORRESPONDENT: Well, Democratic sources I talk to say that their strategy right now is not to "take the bait from the president" on a partisan fight over this war funding bill.

The House speaker literally said that the president should take a deep breath today. And Democratic leaders also sent the president a letter saying sit down with us and negotiate.

(BEGIN VIDEO TAPE)

BASH (voice-over): Less than an hour after the president accused Democrats of meddling in his war strategy and endangering U.S. troops, the House speaker responded with two words -- calm down. REP. NANCY PELOSI (D-CA), SPEAKER OF THE HOUSE: I would extend a hand of friendship to the president, just to say to him calm down with the threats. There's a new Congress in town. We respect your constitutional role. We want you to respect ours.

BASH: Senate Majority Leader Harry Reid was more blunt: "Why doesn't he get real with what's going on in the real world?," Reid said of the president. "His arrogance is getting real out of touch with what's going on with reality."

Emboldened by majority votes in the House and Senate to withdraw troops from Iraq, Democrats say the president is going to have to compromise in order to get money for the war.

PELOSI: This president is not getting any more blank checks from the Congress. This Congress will hold him accountable for the conduct of this war and we will have legislation that will give him every dollar he asks for for our troops -- and more -- but with accountability in there.

BASH: But for all their tough talk, Democratic sources say they have not yet settled on a strategy for after the president makes good on his promise to veto any Iraq War funding bill with a deadline for withdrawal. Democrats will then be faced with the question of how far to take this political standoff while troops who need the funding are in combat.

(END VIDEO TAPE)

BASH: The Democrats are pushing back on the president's warning today that if Congress doesn't send him a war funding bill that he can sign by mid-April, that troops and the mission will be at risk in Iraq. What they say is that that really won't happen, the military won't be in real financial straits, if you will, when it comes to the war, until the middle of May.

And Democrats also say that they blame the president for mismanaging the war, and that's what got the military into this mess.

BLITZER: Dana, what do the Democrats do if the president refuses to budge?

BASH: Well, you know, that's going to open some rifts inside the Democratic Party, no doubt about it, because they have worked very, very hard, as you know, Wolf, to try to -- to manage big differences over how to deal with the funding issue, because there are a lot of people, especially on the left flank of the Democratic Party, who say look, we should just use our power, stop funding this war and that's the way to end the war.

And so if they're going to -- if and when they're going to have to deal with the funding issue once again without any kind of time line or, if the president still refuses to negotiate, they're going to have to figure out whether or not they're going to be able to go forward with that or whether there will be enough Democrats who say, you know, this is a bad idea. It's going to be a tough -- a tough call for them and they -- that's why they have not, apparently, are nowhere near deciding what to do when that happens.

BLITZER: Our Congressional correspondent, Dana Bash, reporting.

So do you think the increase in U.S. troops in Iraq is making things better in that country?

Look at this -- 27 percent of those questioned in a new Pew poll say yes. Nineteen percent say no, while 44 percent say the increase is having no effect.

But it appears views about the war are changing slightly. Forty percent of those questioned say the war is going well for the U.S. That's up from 30 percent last month. But a majority still say things are not -- repeat -- not going well.

Ed Henry and Dana Bash, as you know, are part of the best political team on television.

And remember, for the latest political news at any time, check out our Political Ticker at cnn.com/ticker.

Jack Cafferty with The Cafferty File in New York.

He's also part of the best political team on television.

JACK CAFFERTY, CNN CORRESPONDENT: Yes, yes, yes.

Thank you.

Corporate greed apparently knows no limits. ITT Corporation has been illegally sending classified night vision technology used by our military overseas. This is the stuff that gives our soldiers a distinct advantage on the battlefield at night. We can see the bad guys. They can't see us -- at least not yet.

Government investigators say ITT gave the technology to contractors in China, Singapore and the United Kingdom in order to cut their costs. All in the name of making a buck, you know?

ITT is the leading maker of night vision equipment for the armed forces. The company pled guilty to two felony charges -- export of defense articles without a license and omission of statements of material facts in arms exports reports.

In other words, they didn't bother to report they were doing this.

The punishment for all of this?

They were fined $100 million. That's it.

U.S. Attorney John Brownlee says: "The criminal actions of this corporation had threatened to turn on the lights on the modern battlefield for our enemies and expose American soldiers to great harm." The head of ITT, a guy named Steven Loranger, offered up this lame excuse. He said: "The case is about the actions of a few individuals in one of their many units."

What does that mean?

It's OK as long as it's just a few individuals?

He also said that the company very much regrets that these serious violations occurred. He insists no information about the heart of the technology, something called the tube, was ever compromised.

Of course we don't know that, do we?

We just have to take his word for that.

So here's the question -- what's the appropriate punishment for ITT for sending night vision military technology to potential enemies?

E-mail your thoughts to caffertyfile@cnn.com or go to cnn.com/caffertyfile -- Wolf.

BLITZER: Jack, thank you.

See you shortly.

Coming up, it's the number one issue confronting the next commander-in-chief -- what if the new president is Barack Obama?

(BEGIN VIDEO TAPE)

BLITZER: If you're president of the United States in January of 2009 and the situation is basically the same in Iraq as it is right now...

OBAMA: Right.

BLITZER: ... what would be your immediate first step?

(END VIDEO TAPE)

BLITZER: The candidate speaks candidly about the war in Iraq and what he would do differently. My interview with Senator Barack Obama. That's coming up.

Also, Iran parades captive British sailors and marines before TV cameras as the U.K. weighs its next steps to try to free them.

And why is Republican presidential candidate Senator John McCain upbeat when he assess the conditions in Iraq? We're going to talk about that in our Strategy Session with James Carville and Michael Steele.

All that, right here in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: There are some stunning new developments regarding those 15 British service members seized by Iran.

Our Aneesh Raman has been closely monitoring this story.

He's joining us now live from Riyadh in Saudi Arabia -- Aneesh, what is the latest, given the fact that you're there, the Iranian foreign minister is there, there's an Arab summit underway?

I assume this is a huge issue.

ANEESH RAMAN, CNN CORRESPONDENT: It is.

I spoke to Iran's foreign minister, Manouchehr Mottaki, Wolf, a short time ago, on the sidelines at the Arab summit here.

He told me that the sole woman sailor within this group of 15 British marines and sailors seized by Iran will be released as soon as possible, perhaps as early as today, if not tomorrow. He said "very soon," were his exact words.

Shortly after that, of course, this video was released showing some, not all, of the 15 marines and sailors in seemingly good condition.

Featured permanently was Faye Turney, the sole woman among this group. A letter she wrote her family was shown where she admits to mistakenly entering Iranian waters and also a statement of hers was aired.

Let's listen to that.

(BEGIN VIDEO CLIP)

FAYE TURNEY, BRITISH SAILOR: My name is Leading Seaman Faye Turney.

I come from England. I serve on Foxtrot 99 and I've been in the Navy nine years. I live in England at present.

I was arrested on Friday, the 23rd of March. And, obviously, we trespassed into their waters. They were very friendly, very hospitable, very thoughtful, nice people. They explained to us why we had been arrested. There was no aggression, no hurt, no harm. They were very, very compassionate.

(END VIDEO CLIP)

RAMAN: Wolf, the British government has said that statement was likely made in a situation of coercion and they have said that the video being released is "completely unacceptable" -- Wolf.

BLITZER: This Iranian video that was shot of these British sailors and marines, has it actually been shown to the Iranian people? RAMAN: It has not. The only Iranian state run channel that has aired this is Al-Alam, an Arabic language Iranian station that is broadcast predominantly outside the Islamic Republic. I have repeatedly been calling within Iran. So far, this video has not aired inside the Islamic Republic.

Clearly, it's a sign that Iran is trying to appease global concerns about the condition of these marines and sailors, but at the same time is dealing with a domestic political situation where hard- liners are calling for a trial and calling for these British marines and sailors to be charged with espionage -- Wolf.

BLITZER: Aneesh Raman watching this story for us.

He's now in Riyadh. He was just in Teheran.

We'll stay in touch with Aneesh on this story.

Let's go to Carol Costello.

She's in New York.

She's monitoring all the major stories, the feed coming into THE SITUATION ROOM, as well -- Carol.

CAROL COSTELLO, CNN CORRESPONDENT: Hi, Wolf.

Hello to all of you.

In the Iraqi city of Fallujah, at least 15 American and Iraqi forces were wounded in bomb attacks involving highly toxic chlorine gas. The U.S. military says Iraqi troops and police fired on a pair of trucks carrying the explosives and the chlorine as they approached a government compound. Now, that caused them to blow up before they reached their target.

We're getting new details on the cancer recurrence of White House Spokesman Tony Snow. Just a short time ago, Snow's deputy clarified that cancer was found on, not in, his liver. And doctors say that is a very important distinction.

The chairman of the Federal Reserve says problems in the risky mortgage market does not appear to be affecting the overall economy. But in testimony on Capitol Hill just a short time ago, Ben Bernanke said growing troubles with so-called sub-prime mortgages raise additional questions about the housing sector and bear close watching. The slumping housing market has been a major factor in the U.S. economic slowdown.

And the controversial group Swift Boat Veterans for Truth may have helped bring down John Kerry's 2004 presidential bid, but now the group has also helped derail the nomination of one of its major donors to serve as ambassador to Belgium. Just hours ago, President Bush withdrew the nomination of businessman Sam Fox. In confirmation hearings, Democrats grilled Fox about a $50,000 donation to the Swift Boat group. That's the headlines right now -- Wolf.

BLITZER: Carol, thanks.

We'll get back to you shortly.

Still ahead, Rudy Giuliani picks up a key endorsement in the race for the White House. We'll find out who's now officially backing the Republican presidential candidate.

And the ambitious agenda of House Democrats now floundering in the Senate. We're going to show you why this could become another do nothing Congress.

Stay with us. You're in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: Senator Hillary Clinton tops today's Political Radar.

The senator from New York and Democratic presidential frontrunner today landed the endorsement of the National Organization of Women. NOW is one of the largest women's groups in the country. Emily's List, another powerful women's organization, is also supporting Senator Clinton. She's the only major female candidate in the race.

Steve Forbes is endorsing Rudy Giuliani for president. The prominent businessman and magazine publisher teamed up with the former New York City mayor to ring the opening bell at the Nasdaq today. He'll serve as a senior adviser to Giuliani. Forbes made two unsuccessful bids himself for the Republican presidential nomination back in 1996 and 2000.

Meanwhile, Donald Trump will host a major fundraiser for Giuliani at Trump's estate in Palm Beach, Florida. That's coming up in May.

Senator John McCain says the buck stops with him. In an interview earlier today here on CNN, the Republican presidential hopeful admitted his fundraising efforts are falling short and that it is his fault. He says, and I'm quoting now: "We're still in spring training." McCain adds his team is making adjustments right now.

Fred Thompson appears to be the fresh face for the right and he's gone from zero to 12 points in a brand new Gallup Poll. But today James Dobson threw some cold water on a possible presidential bid by Thompson. The Focus on the Family founder tells "U.S. News & World Report" Thompson is not a committed Christian and that it would be hard for Thompson to connect with religious conservative voters.

A spokesman for Thompson disagrees with Dobson's criticism.

Presidential hopefuls will soon be taking questions from voters in cyberspace. Moveon.org announced today they will host the first ever virtual town hall for candidates this spring.

Let's bring in our Jacki Schechner. She's joining us.

Who's attending -- Jacki?

JACKI SCHECHNER, CNN INTERNET REPORTER: Well, Wolf, MoveOn says that Senator Barack Obama, Senator Hillary Clinton and former Senator John Edwards will all participate if they're invited. There could be some Republican candidates there, too, even though MoveOn is a liberal political action committee. It's all going to come down to who's invited and who agrees to virtually go.

MoveOn sent out an e-mail to its 3.2 million members today asking, "Who do you want to hear speak about Iraq?"

And they say that whoever gets at least 10 percent of the votes will be invited to the town hall. The town hall scheduled for April 10th, Wolf. It's going to be the first of three.

BLITZER: Are only MoveOn members going to be allowed to ask questions?

SCHECHNER: Well, only MoveOn members can ask questions and can vote afterward on whose plan they like the best. But anyone can watch the town hall. It's going to be on the Web site on moveon.org.

BLITZER: Thanks, Jacki, for that.

Up ahead, we've got lots more coming up, including my interview with Democratic presidential candidate, Senator Barack Obama. He's at odds with his Republican counterpart, John McCain. He has some frank words about Senator McCain, about the situation in Iraq.

Plus, more than 100 migrants wash ashore after a deadly three week journey. We're going to have details of their ordeal at sea.

Stay with us. You're in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: Happening now, he's the number two Democratic contender for the White House and he's positioned to become the country's first African-American president.

So what will Senator Barack Obama do about the war in Iraq if he's elected and the troops are still there?

I'll ask him. My interview with Senator Barack Obama. That's coming up in just a few minutes.

Also, Iran releases new video of those seized British marines and sailors and is now promising to free the lone woman in the group. This, as Britain freezes all diplomatic business with Iran.

And immigration officials are processing some 100 migrants who washed ashore on the Florida coast after three weeks at sea on a rickety boat. All of them are believed to be from Haiti. At least one person died on the journey.

I'm Wolf Blitzer. You're in THE SITUATION ROOM.

When you want to be president of the United States, many people watch virtually every move you make. And right now one candidate is stealing the red hot glare.

Our senior political analyst, Bill Schneider, is joining us. He has more on Senator Barack Obama -- Bill.

WILLIAM SCHNEIDER, CNN SENIOR POLITICAL ANALYST: Wolf, Barack Obama has been getting a lot of close scrutiny lately.

How is he holding up?

(BEGIN VIDEO TAPE)

SCHNEIDER (voice-over): How is Barack Obama doing?

Our poll of polls shows him picking up five points between January and February, when he announced his candidacy, and another two points this month.

Hillary Clinton is still the frontrunner.

Obama has made some missteps, like when he spoke about his parents being inspired by the Selma voting rights march.

SCHNEIDER: And so they got together and Barack Obama, Jr. was born.

SCHNEIDER: Obama was born in 1961. The Selma march took place in 1965. Obama's spokesman said he was speaking metaphorically of the civil rights movement as a whole.

When an anti-Hillary Clinton ad turned up on YouTube, Obama told Larry King...

(BEGIN VIDEO CLIP FROM "LARRY KING LIVE")

OBAMA: It's not something that, you know, we had anything to do with or were aware of and that, frankly, given what it looks like, we don't have the technical capacity to -- to create something like that.

(END VIDEO CLIP)

SCHNEIDER: But the ad was made by a political operative working for a firm hired by the Obama campaign. And the technical requirements were not all that great.

Then there's Obama's memoir, "Dreams From My Father."

LYNN SWEET, WASHINGTON BUREAU CHIEF, "THE CHICAGO SUN-TIMES": He has composite characters, made-up dialogue, and he switched names of many of the characters in it. So, when you read it, you're not sure what's true and what's not. SCHNEIDER: These look like rookie mistakes. Could they become serious problems?

SWEET: If these incidents can be made into political attack ads -- again, it could be by groups for or against somebody, either in the -- either in the primary campaign or general -- then he's hurt.

SCHNEIDER: Right now, Obama is new, he's different, and he's got a strong anti-war record. So, people make allowances. Republicans may be a little jealous.

DREW CLINE, "MANCHESTER UNION LEADER": you know, I think a lot of Republicans Really wish they had an Obama on their side this time around. And they don't have anybody to get excited about.

(END VIDEOTAPE)

SCHNEIDER: At this point in 1991, Bill Clinton was tied for 11th place in the Democratic field with 2 percent. In 1987, Michael Dukakis was in fifth place with 3 percent. In 1975, Jimmy Carter was 12th with 1 percent. John Kerry in '03, he was 8 percent.

Suddenly, second place, with 24 percent, doesn't look too bad -- Wolf.

BLITZER: It looks pretty -- it looks pretty good, too, from that perspective.

Bill, thank you.

Meanwhile, how is the senator answering some of the tough questions he's facing?

(BEGIN VIDEOTAPE)

BLITZER: And joining us now on Capitol Hill, Senator Barack Obama.

Senator, thanks very much for inviting us into your office.

SEN. BARACK OBAMA (D-IL), PRESIDENTIAL CANDIDATE: Thank you for having me.

BLITZER: Let's talk about the dominant issue right now affecting the country, the war in Iraq.

OBAMA: Right.

BLITZER: Some of your critics say you have not done enough to stop this war since coming into the United States Senate.

What do you say?

OBAMA: Well, I'm very proud of the fact that I was against this war from the start. I thought that it was ill conceived, and -- and not just in terms of execution, but also conception. What I also said way back in 2002 is, once we were in, we were going to have to be as careful getting out as we were careless getting in, and that we had some obligations to the Iraqi people, as well as the national security interests of the United States, to make sure that we handled an exit properly.

And -- and that's what I have tried to be consistently projecting over the last two years of my time in the Senate.

BLITZER: Let me point out what you said back in 2003. And I'll give you the exact quote.

(BEGIN VIDEO CLIP)

OBAMA: This week, when I was asked, would I have voted for the $87 billion, I said no. And I said no unequivocally, because, at a certain point, we have to say no to George Bush. If we keep on getting steamrolled, we are not going to stand a chance.

(CHEERING AND APPLAUSE)

(END VIDEO CLIP)

BLITZER: You said no then. But, since then, you voted for funding the war.

OBAMA: Well, that 87 billion, I had a very particular concern. And that was, you had $20 billion worth of reconstruction funds that were given out on a no-bid basis. And, as a consequence, I was concerned that you would not see that money spent effectively.

BLITZER: That was largely for Halliburton.

OBAMA: That's exactly right.

And, since that time, we have discovered that in fact the money wasn't spent wisely. We still have $9 billion that's mission somewhere in Iraq that we still aren't clear about.

Some of those procedures were tightened in the votes that I took. But, most importantly, I have said consistently that I think it's important, if we're sending our young men and women into battle, that they have all the resources they need to come back home safely and also to execute their mission.

BLITZER: Because some ardent opponents of the war, like Dennis Kucinich, for example, who is a Democratic presidential candidate...

OBAMA: Right.

BLITZER: ... he takes a principled stand. He's not going to vote to fund troops going off to this war, because he believes that would help bring the troops home.

OBAMA: Right. You know, the problem is, is that you have got an obstinate administration that has shown itself unwilling to change, in the face of circumstances on the ground.

And, in that situation, what you don't want to do is to play chicken to -- with the president, and create a situation in which, potentially, you don't have body armor; you don't have reinforced companies; you don't have night-vision goggles.

Now, there is a ratcheting-up of pressure on the president. And I am very pleased about the vote that took place yesterday, where a majority of the Senate for the first time said we need to have a timetable.

BLITZER: But he said he is going to veto that right now.

OBAMA: I...

BLITZER: And there is a game of chicken going on right now.

OBAMA: I understand that he says he is going to veto it. There is no doubt he will veto it.

But what you are starting to see, I think, is a bipartisan movement in the direction of having a clear endgame. And I am very pleased that the bill that I presented back in January calling for a phased withdrawal starting on May 1 of this year, with the aim of getting all combat troops out by March 31 of next year, that many of the elements in that bill ended up being part of this -- this package that was voted on yesterday.

BLITZER: If the president does veto it, as he vows he will, what do you do next?

OBAMA: Well, I think we continue to put these votes up to the Senate. We put more pressure on many Republican colleagues of mine, who I think recognize that the Bush approach has not worked, but are still unwilling to put pressure on their -- on their president.

BLITZER: Because he says the money starts drying up in mid- April...

OBAMA: Right.

BLITZER: ... for the troops to head over to Iraq.

OBAMA: I think that we continue to put a series of votes up and try to convince our colleagues on the Republican side that the only way that we are going to change circumstances in Iraq is if you see a different political dynamic, that there are, at this point, no military solutions to the problems in Iraq, that what we have to do is get the Shia, the Sunni, the Kurd to come together and save themselves.

We, in fact, are willing to start making some compromises around oil revenues, around arming of militias and so on. In the absence of that, we can send 20,000 more troops, 30,000 more troops. We're not going to see a significant change.

BLITZER: Yesterday, I interviewed Republican presidential candidate John McCain. And he said this:

(BEGIN VIDEO CLIP)

SEN. JOHN MCCAIN (R), ARIZONA: Failure is catastrophe. Failure is genocide. Failure means we come back. Failure means they follow us home.

(END VIDEO CLIP)

BLITZER: What if he's right? What if he's right, and what you're proposing and a lot of Democrats are proposing results in genocide in Iraq?

OBAMA: Well, look, what you have right now is chaos in Iraq. After having spent hundreds of billions of dollars, after seeing close to 3,200 lives lost, what you now see is chaos. And there's no end in sight.

Now, John McCain may believe that it's an option for us to maintain an indefinite occupation of Iraq, regardless what happens in terms of the politics within Iraq, so that we're, every year, sending $100 billion over to Iraq, so that, every year, we're seeing hundreds or thousands of young Americans dying, so that we continue to see a deterioration of America's standing in the world.

I don't think that serves the best interests of the United States. And I don't think it will ultimately result in the kind of...

BLITZER: So...

OBAMA: ... stabilization in Iraq that's necessary.

Now, these are judgment calls. I don't question John McCain's sincerity in believing that the approach that he wants to take, which is essentially a continuation of Bush policies over the last six years, are the right ones to take.

(END VIDEOTAPE)

BLITZER: Coming up; much more of my interview with Senator Barack Obama. I will ask the presidential candidate his views on the issue of gay marriage. Is he for it? Is he against it? That's coming up here in THE SITUATION ROOM, the second part of my interview with Senator Barack Obama.

Also, coming up this weekend, Obama is tapping into the Democratic grassroots with what he's calling community get-togethers. The event is putting a 2008 spin on Howard Dean's successful "Meetup" movement from four years ago.

But, as our Abbi Tatton reports, he's not the only candidate going grassroots.

Abbi, what's going on?

ABBI TATTON, CNN INTERNET REPORTER: Wolf, 41 people have signed up for this event, this Obama event, Saturday at Bob's Your Uncle Pizza Cafe Iowa City. Twenty-three people are heading towards a Manhattan apartment to meet up there. Another four are meeting at a bakery cafe in Oregon.

The Barack Obama campaign is urging its supporters to organize these community events around the country. And, as you can see from this map at the Web site, they are responding. Barack Obama himself is going to be at the home of an Iowa family. That's going to be Webcast, so people can watch it at the Web site.

Now, that is on Saturday. This is today. The John Edwards campaign is billing today as a national John Edwards house party today. Events are being organized tonight around the country. And this DVD has been sent out to the organizers of all these house parties, meet John Edwards -- the suggested start time, 7:30 p.m. tonight. And we will be tracking them -- Wolf.

BLITZER: Abbi, thanks for that.

Abbi Tatton, earlier, Bill Schneider, you saw them both. They are part of the best political team on television.

Coming up: House Democrats tout their legislative successes. So, why aren't many of their bills becoming law, at least not yet? We are going to show you why some say this could become another do- nothing Congress.

Coming up later: A Republican senator takes dramatic action to keep Al Gore's global warming crusade off Capitol grounds.

Stay with us. You're in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: House Speaker Nancy Pelosi is playing up what Democrats have done since they took over the House of Representatives. But what did their agenda actually accomplish so far?

Our congressional correspondent, Andrea Koppel, is on Capitol Hill.

Andrea, how are the Democrats saying that what -- they're -- they're suggesting they have done a lot, but, in terms of actual progress, getting the laws passed, hasn't happened yet.

ANDREA KOPPEL, CNN CONGRESSIONAL CORRESPONDENT: That's true, Wolf.

But, certainly, over in the House, it has. You know, in January, when Democrats regained power after 12 years of Republican rule, Democrats vowed they would lead America in a new direction. (BEGIN VIDEOTAPE)

REP. NANCY PELOSI (D-CA), SPEAKER OF THE HOUSE: I want to hold up for you our checklist of what we have accomplished.

KOPPEL (voice-over): After less than 100 days in power, House Democrats say they're delivering, making good on campaign promises, with more than twice as many recorded votes as Republicans in recent years, almost twice as many days in session, and more than double the number of bills passed.

PELOSI: This is a record that leaves the Republican congresses in the dust. But it's not about them. It's about us.

KOPPEL: So, what have they accomplished?

Since assuming power in January, House Democrats have passed remaining 9/11 Commission recommendations, ethics and lobbying reform, an increase in the minimum wage, a cut in student loan interest rates, expanded stem cell research, a rollback in taxpayer subsidies for big oil, and lower Medicare drug costs.

The House has also passed a resolution opposing the president's troop buildup in Iraq, and, then, just last week, approved a deadline, August 31, 2008 for all U.S. combat troops to leave Iraq. But none of this legislation has become law. That's because, over in the Senate, Democrats have only succeeded in pushing through slightly different versions of three of these measures.

Congress-watchers say that's par for the course, the way these two very different chambers operate.

STUART ROTHENBERG, EDITOR AND PUBLISHER, "THE ROTHENBERG POLITICAL REPORT": The House, the way it's organized, the leadership can push through legislation very quickly. The Senate is a much more deliberative body. It is -- it was set up to stop things, to slow things down. And that's what the Senate is doing now.

(END VIDEOTAPE)

KOPPEL: But, now, as early as tomorrow, Senate Democrats could be celebrating another legislative victory, when they vote on the war, the supplemental emergency war funding bill, which would also include a deadline of March 31, 2008, for all combat troops to leave Iraq.

But, Wolf, both of the bill -- that bill and other bills would still have to be reconciled with their House versions, before they would ever end up on the president's desk.

BLITZER: Basically, what you're saying is -- is that it's one thing to get legislation passed through the House of Representatives; it's another thing to get it passed through the Senate, and then to reconcile it and send a bill to the president that he signs into law. It's a complicated and difficult ordeal.

KOPPEL: Exactly. You explained it perfectly. Thanks. BLITZER: Thank you, Andrea, for that.

Up next: our "Strategy Session."

Remember this from yesterday?

(BEGIN VIDEO CLIP)

MCCAIN: You know, that's where you ought to catch up on things, Wolf. General Petraeus goes out there almost every day in an unarmed Humvee. I think you ought to catch up.

(END VIDEO CLIP)

BLITZER: We will update you on what Senator McCain has been saying today in another interview with CNN.

Also, Senator Obama, he's on the campaign trail. He's campaigning hard. But his numbers aren't moving. Has his run for the White House hit a plateau? That, and a lot more with James Carville and Michael Steele -- they're standing by for our SITUATION ROOM "Strategy Session."

And stick around for much more of my exclusive interview with Senator Obama. That's coming up in the next hour.

We will be right back.

(COMMERCIAL BREAK)

BLITZER: Republican presidential hopeful John McCain is backing off some comments he made yesterday, to a certain degree, about the security situation in Iraq.

Democratic strategist James Carville, Republican strategist Michael Steele, they are here in our "Strategy Session."

I wouldn't say he's exactly backing off, but he's sounding a little bit differently this morning, when John Roberts interviewed him on "AMERICAN MORNING," on a very sensitive issue, whether the -- the current commander, General Petraeus, can actually leave his base and go out there, he said yesterday, in an unarmed Humvee.

Here's what he said today.

(BEGIN VIDEO CLIP, "AMERICAN MORNING")

MCCAIN: I'm not saying that they could go without protection. The president goes around America with protection. So, certainly, I didn't say that. The fact is that the neighborhoods are safer.

(END VIDEO CLIP)

BLITZER: What do you think about the McCain campaign right now? He's -- you know, he's got a difficult challenge against Rudy Giuliani. And, all of a sudden, former Senator Fred Thompson, who is not even a candidate, is -- is getting some points.

(CROSSTALK)

JAMES CARVILLE, CNN POLITICAL ANALYST: This is characteristic of a campaign that's not doing well. He's not meeting his fund-raising goals. He's not performing out there.

And he gets in an interview, and he starts taking it out on the interviewer. He gets in -- and this is where candidates get into trouble. I think Senator McCain is -- is -- is an extraordinary American, but what he needs to do right now is get a good night's sleep, maybe, like, take a week off.

(CROSSTALK)

BLITZER: Well, he's not -- he's not going to take any week off. He's not going to get a good night's sleep.

(CROSSTALK)

CARVILLE: I know. But he's -- but he's -- he's making mistakes that a tired candidate makes whose...

(CROSSTALK)

CARVILLE: ... not doing well.

BLITZER: Michael, his office has just announced he's actually heading off to the Middle East.

MICHAEL STEELE, GOPAC CHAIRMAN: Right.

BLITZER: Let me read a statement they just put out.

"Senator McCain will be traveling to the Middle East over the April recess, including a stop in Iraq. The senator will meet with top military officials and troops on the ground, and will share his firsthand observations upon his return."

(CROSSTALK)

BLITZER: "He believes he has an obligation to tell the American public about the early signs of progress being made in Iraq as a result of the troop surge."

What do you think?

STEELE: Well, I think -- I think it's appropriate.

I think he wants to bring a fresh perspective to the debate, having -- get on the ground, and see what the current situation is with the surge under way and all of that, and make an evaluation of his own, in terms of what he should be doing as a presidential candidate, what he should be speaking to, and how he wants to move forward on this effort.

I mean, I -- I understand what -- what James Carville is saying here about the campaign as a whole. But it's early. I think a lot of these guys...

CARVILLE: Oh, yes.

STEELE: ... quite frankly, have been taken off guard by the speed of this campaign and how it's ratcheted up.

And, so, I think there are a number of factors and variables that McCain wants to take into consideration. Let him do it, come back, and see where...

(CROSSTALK)

BLITZER: Senator Barack Obama -- and we saw part of the interview already. Another part is coming up in the next hour.

He started off...

CARVILLE: Right.

BLITZER: ... you know, huge, with huge momentum. But -- but, lately, it's sort of, as we say, flatlining, in terms of not generating more support than he was a month or two ago.

CARVILLE: Yes. I would not read too much into that. This is true. And we're going to have that.

I think what's happening to Senator McCain, he's not flatlining. He's going down. And that's a lot more troubling thing.

BLITZER: Well, he is sort of staying steady.

(CROSSTALK)

BLITZER: Giuliani went down because of Fred Thompson in this...

CARVILLE: But what's happening...

BLITZER: ... "USA Today" poll.

CARVILLE: ... to Senator Obama is, he has had a couple of less- than-impressive performances at a health care forum out in Las Vegas and things like that.

(CROSSTALK)

CARVILLE: But he's not -- he's a very talented guy. And he's very effective.

And -- and, you know, he started out pretty good. I mean, it's pretty remarkable he is where he is, in terms of somebody...

STEELE: Right. CARVILLE: ... new, and -- and burst on the scene like that.

But I think that what might be a little troubling, if I was running Obama's campaign, is, is that he seems to get up -- need to get up to speed on a couple of these issues.

(CROSSTALK)

BLITZER: Because, Michael...

(CROSSTALK)

BLITZER: ... in February, according to a "USA Today"/Gallup poll, he was at 21 percent, coming in second behind Senator Clinton, 22 percent in early March, now at 22 percent. So, he's been very steady.

STEELE: Steady.

BLITZER: Second place, but not going up.

STEELE: Yes.

And I think -- I think that Jim is exactly right. He's going to have to show the gravitas to engage Hillary. He's going to have to show the gravitas to move an agenda forward, to speak to some specific issues beyond the war. And, to the extent that he's able to do that, you may see the numbers move, or -- or not.

But, you know, it's early. I think a lot of these guys, and -- and ladies, and -- are -- are kind of looking back and going, wow, I didn't think this would move this fast, this quickly.

And, so, a lot of these campaigns are just getting up to speed. And we will see what happens...

(CROSSTALK)

STEELE: ... summer.

BLITZER: A lot of Republicans still looking for a candidate to come in...

(LAUGHTER)

BLITZER: ... whether Senator Thompson, or Newt Gingrich, or maybe someone else.

Is that -- is there a similar phenomenon among Democrats who don't like the field right now and still hoping for somebody else?

(CROSSTALK)

CARVILLE: Every piece of polling data I have seen shows that Democrats are pretty -- actually, very satisfied with this field.

STEELE: Yes.

CARVILLE: I think, like, 8 percent of Democrats are dissatisfied with the field, 24 percent of Republicans.

That is what produces the -- a Tom -- for a Tom -- Senator (sic) Tom Tancredo, which produces Newt Gingrich talking about he's going to run.

I don't -- other than Al Gore, I don't know of any other Democrat that is talking about getting in the race. And Gore is a little bit...

(CROSSTALK)

STEELE: If Al Gore gets in the race, then that changes the dynamics across the board.

CARVILLE: It would change it.

BLITZER: How does it change it?

(CROSSTALK)

STEELE: Well, I think he becomes the immediate front-runner. And I think a lot of the energy in the party kind of moves in his direction, or at least a split between him and Hillary.

(CROSSTALK)

STEELE: And that's going to be a very interesting dynamic to see.

And, on the Republican side, should a Fred Thompson get in the race, yes, that will mix it up. But I think, at the end of the day, you will see the -- the -- the field kind of settle down, Giuliani, McCain, possibly Thompson, possibly Romney picking up that last...

(CROSSTALK)

CARVILLE: But you had James Dobson today declaring that Fred Thompson was not a Christian.

I mean, apparently, this guy has assumed the role of God. He's now judging and telling people what religion they are.

STEELE: And that is what the party has to avoid, is these -- these extremes.

CARVILLE: Right.

BLITZER: We have got to leave it there. Guys, thanks very much.

CARVILLE: Thank you.

BLITZER: James Carville, Michael Steele, good to have both of you in THE SITUATION ROOM. Still to come, we will have more on my exclusive interview with Senator Barack Obama. Does he think homosexuality is immoral? His answer to that question and a lot more, that is coming up.

And Jack Cafferty wants to know, what's the appropriate punishment for the company that sent night-vision technology to potential enemies? Jack standing by with "The Cafferty File."

And you're in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: My exclusive interview with Senator Barack Obama, that is coming up in the next hour. You are going to hear what he has to say about Iran. You will be interested in this.

Let's go to Jack Cafferty in the meantime for "The Cafferty File" -- Jack.

JACK CAFFERTY, CNN ANCHOR: The question is: What's the appropriate punishment for ITT for sending night-vision technology to potential enemies? The company pleaded guilty to two felony charges and was fined $100 million. Apparently, most of you don't think that's enough.

Ethan writes from Iraq: "Simple solution for ITT passing along sensitive information. Current and future government contracts should be stopped, period."

Tom in California writes: "Until corporate executives are held personally accountable and those at the top are prosecuted and sent to jail, companies will still look at the risk-reward for breaking the law. If a company can make $200 million in profit and get fined $100 million, where is the punishment?"

Jim in Indiana: "The appropriate punishment for disclosing technology which protects our armed forces on the battlefield should be the same as for committing treason. That is exactly what ITT has done, regardless of the CEO's lame excuses."

Hugh in Huntsville, Alabama: "Real simple. Find those few individuals and send them to Guantanamo, with everything else -- everyone else we have caught fighting for and aiding the terrorists."

Gale writes: "The report on the night-vision chilled me to the bone. Try these bastards for treason."

Don in Lake Worth, Florida, writes: "Jack, how about giving them the same punishment as they gave the Border Patrol agents?"

Those are the ones that are in prison, remember?

And Angelo wrote: "Hey, I served time for a felony. How come they never will?" -- Wolf.

BLITZER: Jack, thanks very much. And, to our viewers, you're in THE SITUATION ROOM.

Happening now: Iran puts its prisoners on display. Is it now headed for a military showdown with Britain? Could Britain succeed where America once failed?

What would Barack Obama do about Iran if he were commander in chief? I will have an exclusive interview with the Democratic presidential candidate.

And --

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