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Pressure to Resign: Senator's Bathroom Bust; Fred Thompson for President; GAO Report: Iraq Failures

Aired August 30, 2007 - 16:00   ET

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


WOLF BLITZER, CNN ANCHOR: Happening now, the price of scandal. Another Republican now urging Senator Craig to resign. But is he listening? The Idaho governor shares what he knows. And presidential candidate Mitt Romney vents about what he calls Craig's disgraceful behavior.
We're standing by also for the audio tape from the arrest.

Plus, a grim new report on failures in Iraq. It's raising questions about whether White House claims of progress are rosier than the reality.

And he was the first African-American elected governor in the United States. Now Doug Wilder has some powerful things to say about Democratic Senator Barack Obama and why he thinks some other black leaders, in his words, are pimping their race.

Wilder joins us to talk about the presidential contest.

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

This hour, there's growing speculation about whether Senator Larry Craig may try to escape the red-hot glare of scandal by simply calling it quits. Today, a third Senate Republican is calling for Craig to resign. That would be John Ensign of Nevada.

And many other Republicans have nothing but harsh words to say about Craig's arrest in an airport men's room. GOP presidential candidate Mitt Romney is speaking out once again today about the former Idaho -- his former Idaho campaign chairman and what should happen to Senator Craig next.

Our chief national correspondent, John King, is standing by. He interviewed Mitt Romney earlier today.

But let's go to our congressional correspondent, Dana Bash. She's on the scene in Boise, Idaho, for us.

First of all, Dana, we're about to hear the actual audio of the arrest at that bathroom at the Minneapolis airport. We're going to hear what the police officer said to Craig, what Craig said at that arrest. That's coming up momentarily.

But where you are in Boise right now, what are people saying about Craig's chances of surviving this politically? DANA BASH, CNN CONGRESSIONAL CORRESPONDENT: Well, Wolf, from the sources we talked to, both here in Idaho and back in Washington, there is a growing sense that Larry Craig may be resigning soon. And I put that -- I gave that information to the senator's spokesman, Dan Whiting, and he responded with one simple sentence: "I don't expect any announcement today from Senator Craig."

Note that word in the statement, "today".

Now, I caught up with Idaho's governor, someone who has known Senator Craig for decades, worked with him closely, is somebody who considers himself a good friend. We talked, and when we talked, he used his words very carefully. In that -- even in that, especially in that, there was a message.

(BEGIN VIDEOTAPE)

BASH (voice over): Idaho's governor is among the friends at home who aren't publicly pushing Senator Larry Craig to resign, but it sure sounds like he expects him to go.

GOV. BUTCH OTTER (R), IDAHO: You never really unring the bell. And the bell has been rung. And so, as we go forward, I suspect there's going to have to be additional consideration by Larry and his family on where exactly they're going.

BASH: Governor Butch Otter is one of the few people known to have spoken with Craig about his crisis. He concedes to CNN that pressure from Republicans in Washington, losing his top spot on committees, hurts. A lot.

OTTER: Ranking members is very important to him.

BASH (on camera): It strips him of a lot of influence that helps the state of Idaho.

OTTER: That's right.

BASH: Isn't that problematic for people?

OTTER: I'm sure -- well, of course it's problematic. And I'm sure Larry is going to -- Larry and his family are going to take that into consideration.

BASH (voice over): A new poll here shows 55 percent of Idahoans want Craig to resign. Stop by Goldy's diner in Boise, and you hear it loud and clear.

UNIDENTIFIED FEMALE: I think he absolutely should resign. We don't need dishonest -- dishonest politicians.

UNIDENTIFIED FEMALE: He does think he's above the law and he needs to resign.

BASH: "The Idaho Statesman" enthusiastically endorsed Craig last time he ran for Senate. Now they are calling for him to step down. "Craig seems more interested in hunkering down, operating from a defensive state of denial. This is his prerogative, but he should not compromise Idaho interests in the process," the editorial said.

But people who've worked for him say Craig is known to be defiant.

UNIDENTIFIED MALE: If there's nothing to hide, then, in fact, he will remain defiant until the critical mass...

BASH: Does Craig's good friend the governor think he can survive?

OTTER: I'm not going to go there.

(END VIDEOTAPE)

BASH: He's not going to go there. But if, in fact, Senator Craig does step down, it would, of course, be the governor who would have to appoint his replacement.

I asked the governor if he is at least quietly thinking about who he would put in Senator Craig's place, and he responded, "I don't have to think about it because we're already getting their phone calls" -- Wolf.

BLITZER: So where exactly is Senator Craig right now, Dana?

BASH: You know, we don't know the question to that. He pretty much went under after his statement two days ago here in Boise. And we haven't heard from his since.

His office says that he is on vacation, but he has not been seen or heard from publicly in the last two days. We do know the governor is a good example that he's reaching out to a few of his friends and talking to them about what's going on and his potential future.

BLITZER: All right. We'll see what happens next and we'll watch it with you, Dana. Dana.

Dana is in Boise for us.

Republican presidential candidate Mitt Romney is stopping just short of calling for Senator Craig to resign, but Romney isn't holding back his deep disappointment in the man who stepped down as his Idaho chairman just as the scandal broke.

Let's go to our chief national correspondent, John King. He's joining us in South Carolina right now.

You interviewed Mitt Romney earlier today, John. Tell us the thrust of his comments on Senator Craig.

JOHN KING, CNN CHIEF NATIONAL CORRESPONDENT: Well, Wolf, every Republican politician across the country is being asked about this scandal but it is, of course, more important in the case of presidential candidate Mitt Romney, because Larry Craig, was, until his arrest, until his guilty plea became public, the Idaho state chairman for the Romney campaign, and because Romney is campaigning on the theme that he among the Republicans can best represent traditional family values in the race for the White House.

So, the campaign quickly severed its ties with Senator Craig, made him step down as its state chairman. But Governor Romney is being a bit more cautious than many other Republicans, including presidential rival John McCain. He says his conduct, Senator Craig's conduct is disgraceful, but he won't flatly say the senator should step down.

(BEGIN VIDEO CLIP)

GOV. MITT ROMNEY (R), MASSACHUSETTS: I think at this stage, the right course is for him to make this decision, looking at his own conscience, talking to the people of Idaho, meeting with his colleagues in the Senate. I'm not one of those. I'm going to let him make that decision.

(END VIDEO CLIP)

KING: And Wolf, inside the Romney campaign, they say simply that Governor Romney does not want to push Senator Craig out, does not believe it is his decision to make. But one of the reasons they say the governor doesn't feel he has to publicly call on Senator Craig to step down is, they would tell you behind the scenes, as many Republicans would, and as Dana just reported, they believe Senator Craig will make that decision himself and make it quite soon.

BLITZER: He's doing really well in Iowa and New Hampshire based on the latest polls that we've seen, John. We're talking about Mitt Romney. But some observers suggesting he may have hit a little bump in the road as far as his stance on abortion.

You spoke to him about that.

KING: It has been a big question since day one, Wolf. Back when he was running for governor, Mitt Romney, first running for Senate back against Ted Kennedy some time ago, Mitt Romney for a long time was a politician who favored abortion rights.

Now running for president and in his years as governor, he has said, no, he is now anti-abortion. But, of course, many social conservatives are skeptical.

They want to know, is this truly a change borne of conviction, or is it a political calculation as he runs for president? And you're right, the governor has made some significant progress, especially in Iowa, convincing conservatives this is from the heart, but recently he confused them again, because at one event he said he would support a constitutional amendment, meaning a national ban on abortions.

Then he said at another event, this should be up to the states. he said it should be up to the states. If one state wants to allow abortion and another state wants to outlaw abortion, that is fine with him. So, I put the question to him today, which one was it? And he insists it's not a contradiction.

(BEGIN VIDEO CLIP)

ROMNEY: Actually, it's the same position that President Bush espoused a long time ago, which I would welcome an America that didn't have abortion. But that's not where we are today, that's not where the people are. And therefore, in my view, the right course for it for those of us who are pro-life is to fight to change hearts and mind and to see Roe v. Wade overturned, and that would allow states and the elected representatives of the people to be able to make their own decisions with regards to abortion.

(END VIDEO CLIP)

KING: So, Governor Romney trying to put that behind him, Wolf. But I can tell you, while he has made significant progress, there also are a great deal of social conservative activists here in conservative South Carolina, in Iowa as well, saying they are simply not sure yet that they can trust this man, whether his conversion is credible enough.

That is one of the reasons some do see an opening, especially here in this state, for former senator Fred Thompson, who, as we know, is to join the Republican race officially this time next week -- Wolf.

BLITZER: All right, John. Thanks very much.

And we're going to have a lot more from John's interview with Mitt Romney. That's coming up here in THE SITUATION ROOM in the next hour. Is Romney willing to say how much of his own cash -- and he has hundreds of millions of dollars -- how much of his own cash is he willing to put into the campaign?

John asked him that question. That interview coming up in the next hour.

And also coming up, we hope to learn specifically, specifically the date of when former senator Fred Thompson will make his presidential run official. You just heard John King say we expect that to happen next week. We should be having the specific date. That's coming up as well.

Lots of political news happening here today.

Let's go to Jack Cafferty and "The Cafferty File" -- Jack.

JACK CAFFERTY, CNN ANCHOR: Did I hear you say we're waiting for audiotapes of Senator Craig's encounter with police?

BLITZER: Yes. When you hear this -- I'm going to -- because I'm going to come to you after you hear this.

It's the whole exchange. It was recorded by the police at the Minneapolis airport. The exchange that Senator Craig had with the arresting officer, explaining what happened, what didn't happen, the arguments. You're going to want to hear this, Jack. And I'm going to want our viewers to hear what you think about that exchange.

CAFFERTY: I'm not sure I want to hear this.

BLITZER: Yes, you do. You do. Trust me.

CAFFERTY: I do?

BLITZER: Yes.

CAFFERTY: All right. You're the boss.

John Edwards thinks that Americans are willing to sacrifice, and one of the ways he's suggesting that we do that is that we all drive more fuel-efficient vehicles. The Democratic presidential hopeful was asked specifically if he would ask people to give up their beloved SUVs, sport utility vehicles, and he said yes.

Of course, while they're campaigning, many of the presidential candidates, including Edwards, ride around in huge SUVs or even bigger vehicles. Edwards' family owns a hybrid SUV, the Ford Escape, and a Chrysler Pacifica.

Edwards also says that as president, he would ask Americans to conserve energy. He thinks the country should focus on becoming a leader when it comes to creating alternative energy, you know, stuff like solar energy, for example? Try selling that idea to the oil companies.

Edwards also wants a national cap on carbon dioxide emissions that's lowered each year. When asked how he could call on Americans to sacrifice while he lives in a mansion, Edwards said he came from nothing, he worked hard all his life, and has always supported the working man in his fight against big corporations as a trial lawyer.

So here's the question: John Edwards says that he would ask Americans to give up driving SUVs. Are you willing to do that?

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

I really don't know if I want to hear that bathroom stuff.

BLITZER: You know, you're going to hear it shortly. We have the audiotape. We're going to play it when we come back.

We'll take a quick commercial break. Stand by, Jack. Trust me on this, OK?

CAFFERTY: OK.

BLITZER: OK. I think it could be interesting.

Also coming up, a trailblazing African-American politician takes on the question: Is Barack Obama black enough? The former Virginia governor, the one-time presidential candidate, Doug Wilder, has praise for Obama. Also has some words of warning.

That's coming up.

And Fred Thompson is about to make an announcement about his likely presidential campaign.

Candy Crowley standing by with details on that front.

Plus, a negative new report on Iraq has some Democrats asking if the White House is trying to change the facts.

Dueling assessments of the war, all that, coming up right here in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: A lot of people have been waiting to know when the former Tennessee senator, Fred Thompson, will make it official.

Our senior political correspondent, Candy Crowley, is here.

Are you ready to make it official?

CANDY CROWLEY, CNN SR. POLITICAL CORRESPONDENT: On November 6th -- September 6th, next Thursday, we will have the announcement shortly after noon, followed by a five-day campaign swing. This according to sources.

The former senator has been talking to his supporters over the past couple of days in conference calls. We expect to have official clarity, as we call it, from those supporters who give sort of the (INAUDIBLE) of officialness, but we don't expect that he will announce until the 6th. In fact, we expect him to announce on the 6th at 12:00.

Then he's going to South Carolina, Iowa, the usual suspects. He's going to wrap this up on the 15th with sort of a homecoming in Tennessee.

BLITZER: So, September 6th, next week, Senator Thompson, the former senator from Tennessee, will make it official.

John King is also watching this story, our chief national correspondent.

September 6th, right after Labor Day, John. What do you think?

KING: And a few hours after a Republican presidential debate on another network, Wolf, up in the state of New Hampshire. Senator Thompson deciding not to attend that event, deliberately timing his announcement to be after that debate.

He will take part in future debates, we are told, though. And then he will get in. He is trying to reshape the Republican race.

There are many, as you know, who say in a caucus state like Iowa, can he organize this late? That might sound funny. The caucus is still about four months away, but some say he is way behind the curve there.

I'll tell you, in this state, though, it's a very unsettled field. The polling has bounced around all over the place, and many think in this state, if he gets in and campaigns aggressively, Senator Thompson does have a chance.

There are many in the Republican Party, Wolf -- and you and Candy know this full well -- who said he should have done this a month or so ago, that he had this huge amount of interest at the beginning. He sort of wavered a bit.

The fund-raising wasn't quite what they thought. But this is a Republican race that is unsettled. We've been waiting for Senator Thompson, and a week from today he'll jump in.

BLITZER: Let me bring back Candy.

Some observers were saying, you know what? He was waiting too long. These other guys, whether Giuliani or Romney or McCain, or any of the other Republicans, they really got a head start.

What are you hearing from his people why they've waited this long? And do they think they can catch up at this point?

CROWLEY: They absolutely think they can catch up. Let me make one correction. He's going to announce shortly after midnight. We expect an Internet announcement, and then go on to the...

BLITZER: On September 6th?

CROWLEY: Yes.

So, look, the Thompson people feel that they can run a different sort of campaign. They have felt all along that people were sort of already sick of the presidential campaign, that he can come in and look like somebody new.

OK, here's some excitement. Here's some fresh infusion into a field that is not yet settled. So there are a number of people who think Republicans are waiting for this.

Having said that, he's also gotten some staff on the ground, has a good Iowa staff. New Hampshire looks a little more iffy. But they absolutely have to start on the ground running because they are behind just in terms of getting him out there.

BLITZER: All right. We'll be watching next week.

Thanks very much, Candy, John, the best political team on television.

We're standing by for the audiotape. We're told about it's about five minutes of the arrest of Idaho Republican Senator Larry Craig at that Minneapolis airport. We're going to play it for you. You're going to hear the exchange between the senator and the arresting police officer.

That's coming up.

Also, Donna Brazile and J.C. Watts, they're standing by for our "Strategy Session".

And some unexpected news about the economy, during this rocky time for the financial markets.

We're watching all of this. Lots of news happening today right here in THE SITUATION ROOM.

(COMMERCIAL BREAK)

(NEWSBREAK)

BLITZER: We're standing by to play for you the audiotape of the arrest of Republican Senator Larry Craig of Idaho at that Minneapolis airport. It's about a five-minute audiotape of what happened, the exchange between the arresting police officer and Senator Craig.

That's coming up here in THE SITUATION ROOM.

Also, a new government report sees more failure than progress in Iraq. Why is the White House taking on the war -- why is the White House's take on the war, that is, far more upbeat? Dueling reports, political clashes, that's coming up as well.

Plus, just when you thought the race to the White House couldn't be any more front-loaded, another state is jumping ahead. We have details of the calendar which is changing rapidly.

All that coming up right here in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: A new draft report on the situation in Iraq is being called strikingly negative. The study is being put together by the independent investigators with the Government Accountability Office, the GAO.

"The Washington Post" reports the GAO found Iraq has failed to meet all but three congressionally-mandated benchmarks for political and military progress. The document reportedly questions a more positive assessment of the situation in Iraq issued by the White House last month.

Jessica Yellin, our congressional correspondent, is standing by on Capitol Hill.

Let's go to our White House correspondent first, Elaine Quijano.

What, if anything, is the White House saying about this draft GAO report?

ELAINE QUIJANO, CNN WHITE HOUSE CORRESPONDENT: Well, the White House response essentially, Wolf, is that it's more than about benchmarks in Iraq. Officials here say, look, it is not news that there's been a lack of political progress at the top levels in Iraq. They note that even their own interim report found that.

What the White House is arguing is that progress in Iraq cannot be measured by benchmarks alone. Here's White House Press Secretary Tony Snow.

(BEGIN VIDEO CLIP)

TONY SNOW, WHITE HOUSE PRESS SECRETARY: If you take a look at what Congress has mandated for this report, is, it says, have you met these, have you met in the full? Well, the answer is, you're going to find in a lot of cases of course they haven't met them. The real question is, do you have progress in the right direction?

The other thing I would suggest is that it would be a mistake to limit one's view of what goes on in Iraq to the benchmarks.

(END VIDEO CLIP)

QUIJANO: Now, the White House insists that since the surge, there's been some bottom-up reconciliation as they call it, also some Sunnis turning against al Qaeda. But Democrats continue to argue that when it comes to the leadership in Baghdad, there have not been significant steps towards political reconciliation, Wolf. And they continue to question why American troops should continue their sacrifices to provide the Iraqis political breathing space -- Wolf.

BLITZER: Elaine Quijano at the White House for us.

Thanks.

On Capitol Hill, some Democrats are eager to pounce on the findings of the independent draft report on Iraq.

Let's go to our congressional correspondent, Jessica Yellin.

Jessica, what are the Democrats saying?

JESSICA YELLIN, CNN CONGRESSIONAL CORRESPONDENT: Well, Wolf, the Democrats are actually leveling some stinging accusations at the White House today. They say that they're concerned the White House is working to provide Congress spin about the status of the war on Iraq, rather than information and analysis.

In a statement from Senator Harry Reid, he said he's worried that a government whistleblower may have leaked that draft of the GAO report to the press out of concern that its judgments would be softened in the final version. Democrats say it's essential that the public get that final copy of the GAO report just as it was written by their independent investigators.

(BEGIN VIDEOTAPE)

REP. NANCY PELOSI (D-CA), HOUSE SPEAKER: When calling upon the president...

YELLIN (voice over): Democrats are going out of their way to trumpet the fact that the GAO report was written by investigators outside White House control. Nancy Pelosi calls it nonpartisan, saying, it concludes "the Iraqi government has failed to achieve required reforms."

Senate Democratic Leader Harry Reid emphasizes it was conducted by "objective experts" who make it clear "a new direction in Iraq must begin immediately..."

The reactions are infuriating Republicans, who point out the report has not yet been released. Says one Republican Senate leadership aide, "It would be nice if Democrats would wait to read the reports before offering their analysis." But at least one Republican on Capitol Hill says if the final report does conclude that only 3 of 18 benchmarks have been met...

REP. PETER HOEKSTRA (R), MICHIGAN: It's disappointment. I believe that this threat is very real and we need to be successful, and would be hopeful that we would be meeting some of the milestones and objectives that we had set out there.

(END VIDEOTAPE)

YELLIN: And, in fact, the Pentagon today is challenging some of the GAO's findings, and they're recommending some changes, but they say it's because the GAO got it wrong on some points; they're not trying to just spin the intelligence -- Wolf.

BLITZER: All right, Jessica, thanks very much -- Jessica Yellin on Capitol Hill for us.

The Republican candidates, with the exception of one, are saying adios to a debate on the Spanish-language TV network Univision. Is it a slap to Latinos? That story is coming up in a moment.

But Abbi Tatton following another story for us right now.

Abbi, what are you picking up?

ABBI TATTON, CNN INTERNET REPORTER: Also on the topic of what Democrats and Republicans are doing online in terms of reaching out in Spanish, Hillary Clinton is out front in polls amongst Democratic Latino voters. She's already got a bilingual invitation to next week's Univision forum, which is happening next week, that Susan Candiotti is going to be telling you about later.

But she's not the only one trying to get their message out online in Spanish. At Barack Obama TV -- this is a section of the senator from Illinois's Web site -- he's got Spanish subtitles there.

And the bilingual Chris Dodd shows up on this social networking site that is bilingual Web site called mygrito.com, one of four Democratic candidates who is there. Bill Richardson, the only Hispanic in the race, is not showing up on that Web site, but he has extensive features on his own Web site that are in Spanish, as well as in English.

This is all notably absent from the Web sites of the Republicans, with the notable exception of Mitt Romney's site. He has a welcome from his son Craig there in Spanish at the site.

John McCain is one of the Republicans who would have been at the Univision forum that was going to be happening, which is now axed. His site is only in English, but the campaign says today that they're looking into the topic of translation -- Wolf.

BLITZER: Abbi, thanks very much.

Susan Candiotti is following this story for us.

Susan, some are saying this is a slap to Latinos, the Republican decision, in effect, to not attend this Univision debate.

SUSAN CANDIOTTI, CNN NATIONAL CORRESPONDENT: That's right, Wolf. In fact, some GOP strategists are even saying that this is passing up a golden opportunity to reach a national audience.

(BEGIN VIDEOTAPE)

CANDIOTTI (voice-over): You might think Republican presidential candidates would jump at the chance to reach Univision's huge Spanish- speaking audience broadcast in prime time.

MARIA ELENA SALINAS, UNIVISION ANCHOR: In Miami, New York, and Los Angeles, just to name some of the major markets, we have higher viewership in general market ratings than do CBS and NBC and sometimes even ABC.

CANDIOTTI: But, with Senator John McCain the only Republican who signed up for the network's historic event simultaneously translated into English, the network canceled the GOP's September 16 forum.

McCain supporter and Republican strategist Analysis Navarro says the party needs to work harder to bring back the Hispanic vote.

ANA NAVARRO, POLITICAL CONSULTANT: George Bush in 2004 got upwards of 30 percent of the Hispanic vote. In the last election, the Republican Party got closer to 23 percent. We cannot win if we're not competitive with the Hispanic community.

CANDIOTTI: Turning down the Univision invite could come back to haunt Republicans.

SALINAS: I think that, you know, it's possible that some voters might take that as a personal insult or might take that as a lack of interest on on -- on their part.

CANDIOTTI: With important issues on the line, jobs, health care, education, Latino community activists say waiting until the general election to stop by a coffee shop for glad-handing won't cut it.

MARYTZA SANZ, LATINO LEADERSHIP: Pinata policy for us is OK. I'm going to give you what you want to hear. You want to hear that I say hola, that I drink cafe, and things like that. And that's not what our community needs. We want you to be sincere.

CANDIOTTI: Univision says it's possible the GOP event will be rescheduled.

(END VIDEOTAPE)

CANDIOTTI: Every Democratic candidate has confirmed that they will attend the Univision forum, which is scheduled for, on the Democratic side, next Sunday -- Wolf.

BLITZER: Thanks very much, Susan Candiotti, joining us from Miami.

When we come back, we're going to play the audiotape for you, the audiotape of the arrest, the arrest of Republican Senator Larry Craig at that Minneapolis airport restroom, the exchange that occurred that day upon the arrest between the Republican senator from Idaho and the arresting police officer -- that audiotape coming up right after this.

(COMMERCIAL BREAK)

BLITZER: There's new reason today to wonder if the presidential primary season will start this year, instead of 2008. Two more states are now threatening to push the already front-loaded schedule of contests into even more chaos.

Tom Foreman is here. He's keeping track of the madness, shall we say.

What is going on?

TOM FOREMAN, CNN CORRESPONDENT: Oh, Wolf, we're -- what we're doing right now -- I'm not kidding -- we're headed toward electoral meltdown if this continues. It was already confusing, but now a move by another Western state could put this chaotic primary calendar just right over the edge.

(BEGIN VIDEOTAPE)

FOREMAN (voice-over): Wyoming Republicans say they're moving their delegate selection convention to January 5, jumping to the head of the pack, ahead of Iowa and New Hampshire, the states that have historically kicked off the presidential primary season. It's the latest in the scramble by a number of states jockeying to move up in the calendar. Michigan is hoping to move up its primaries to the 15th. South Carolina Republicans already brought forward their contest.

KATON DAWSON, SOUTH CAROLINA REPUBLICAN PARTY CHAIRMAN: The date of our first-in-the-South Republican Party presidential primary will be held on Saturday, January the 19th, 2008.

FOREMAN: They changed their date because Florida had advanced its primary to January 29.

The national Democratic and Republican parties are threatening to strip Florida and some of the other states planning to creep forward of some or all of their delegates to the presidential conventions. All of this movement could prompt Iowa or New Hampshire to hold votes this year.

BILL GARDNER, NEW HAMPSHIRE SECRETARY OF STATE: If we have to, we will go the year before. That's -- and, so, that's -- it's not off the table.

FOREMAN: One thing is for certain. January's primary calendar is getting very crowded, and that could help the candidates with deep pockets, like Hillary Clinton, Barack Obama, Rudy Giuliani, and Mitt Romney.

WILLIAM SCHNEIDER, CNN SENIOR POLITICAL ANALYST: They have the resources to compete in the big states, like Michigan and Florida, and to recover from early setbacks in Iowa and New Hampshire fast, with such a crowded calendar.

(END VIDEOTAPE)

FOREMAN: Remember those deep pockets, because they make a big difference here. Yes, the parties are threatening to do something about this, but the parties can't do anything about this, because the campaigns are adjusting. They're re-strategizing. And they don't want the party to step in all of a sudden and say, oh, all your readjustments are now back out the window, because we have changed it again.

BLITZER: What a mess.

Tom, thanks very much -- Tom Foreman watching this story for us.

We're going to take a quick break.

When we come back: the audiotape, the audiotape of the arrest of Senator Larry Craig of Idaho by the police officer at the Minneapolis airport. We will play the tape. We will discuss it in our "Strategy Session" -- all that coming up.

(COMMERCIAL BREAK)

BLITZER: Isolated by his own party, can Senator Larry Craig's political career survive his arrest in a men's toilet sex sting operation?

Let's go to our "Strategy Session."

I'm joined by Democratic strategist Donna Brazile, former Republican Congressman J.C. Watts.

Guys, thank you to both of you for coming up.

Can he survive this? Is there any way?

Donna, you have been around politics for a long time. You have seen sex scandals unfold. Can this politician survive?

DONNA BRAZILE, CNN POLITICAL ANALYST: I think it's going to be very hard for Senator Craig to survive, because, first of all, it's a distraction to the senator, his family, his staff. And, if he arrives back in Washington, D.C., as expected next week, the news media will hound him.

So, I think he should do what Senator McCain and Senator Coleman suggested and step down, for the good of his party, his country, and his family.

BLITZER: Senator Ensign of Nevada suggested that as well.

And "The Idaho Statesman," his hometown newspaper in Boise, which had always endorsed him, they say, in their editorial today -- let me read it to you -- "Senator Craig needs to resign. We cannot abide an elected official who didn't disclose a lewd conduct arrest until the story broke 77 days later, a lie by omission and a violation of the public trust."

What do you think?

J.C. WATTS, CNN POLITICAL ANALYST: You know, Wolf, public officials usually cannot survive legitimate sex scandals or financial scandals.

And -- and I think Senator Craig is going to have a very difficult time overcoming this. Whether or not he should resign, I -- you see the meltdown around him. He's got his colleagues saying he should step down, "The Idaho Statesman" saying he should step down, a paper that's endorsed him.

You know, I think Senator Craig's got to make a decision, if he's prepared to put his his -- his family and his friends and his state through this. And, hopefully, he will -- he will give it some serious thought.

BLITZER: This quote has been told to our Dana Bash, "No decision today," operative word, "today," no announcement from Senator Craig today.

But that word "today" sort of jumped out at all of us when we saw that statement.

Let's take a look at some recent polls, the latest polls coming in from -- first -- first, we will go to Iowa. Among likely Democratic caucus-goers among the Democrats' side, take a look at this. Hillary Clinton is now at 28 percent. She's down slightly from the last time this poll was conducted. Obama has gone up nicely. He's at 23 percent, John Edwards at 20 percent. And Bill Richardson is coming in fourth at 13 percent. It looks like, in Iowa, Donna, there's a contest. There's a fight going on.

BRAZILE: I would say it's a four-person race.

But, you know, one of the things I learned not only organizing for the Iowa caucuses, but also participating, is, as someone who -- and observing, is that it's all about the ones and the twos. Ones are the people who are committed to going to the caucuses on behalf of your candidate, and two are the people who are leaning toward your candidates.

These polls, while they're very important for raising money and raising public attention for these candidates, doesn't matter. It's about the ones and the twos at this point.

BLITZER: Let's take a look at the Republican side. In Iowa right now, Mitt Romney is ahead with 27 percent. He's gone up since July, Rudy Giuliani at 17 percent, Mike Huckabee at 14 percent.

Fred Thompson, who we're told, on September 6, will make it official he will be a Republican candidate, he's at 13 percent. It looks like there's a contest among -- on the Republican side as well.

WATTS: Well, you know...

(APPLAUSE)

WATTS: You know, we're applauding that.

I think the interesting number there, Wolf, was Mike Huckabee. You know, as Donna said, you pay your people -- at the straw poll, you pay your people to turn out and come out and vote for you. I understand Romney bought about 3,400 votes. You know, he finished first. Huckabee finished second and got a whole lot more votes than he paid for.

BLITZER: And, if you take a look at this ARG, American Research Group, poll, he went from 1 percent to 14 percent. In part, probably because of that Iowa straw poll, he did as well as he did.

And...

WATTS: And Huckabee's a guy, Wolf, I think we should keep our eyes on.

BRAZILE: He's a sleeper, I agree.

BLITZER: The former governor from...

WATTS: Yes.

BLITZER: ... Arkansas.

All right, let's move over to New Hampshire. On the Democratic side, right now, Hillary Clinton seems to be widening her lead a bit. She's at 37 percent, Obama 17, Edwards 14 percent, Bill Richardson 7.

Less of a contest, at least on this date, than -- than it would -- than it would be in Iowa.

BRAZILE: The thing that you look at for these presidential candidates is strength. Hillary is seen as a strong leader. She's strong on foreign policy. She's strong on domestic issues. She's leading right now because voters are comfortable with her leadership.

BLITZER: On the Republican side in New Hampshire -- I will put up the numbers in this ARG poll -- 27 percent again for Mitt Romney -- he's from neighboring Massachusetts -- 23 percent for Giuliani, 12 for McCain, 8 percent for Fred Thompson, not officially in, but he will be in next week.

Romney's spending a lot of money in Iowa and New Hampshire.

WATTS: He's spending a lot of money.

I think he's receiving some benefits until others go up on there. Then what happens to those numbers? So, he's kind of the lone ranger out there right now that's really kind of getting the message out over the airwaves.

And, so, once someone else starts to do that, we will see what those numbers -- those numbers are not solid, by any stretch.

BLITZER: They're going to change a lot...

WATTS: Yes, that's right.

BRAZILE: That is correct.

BLITZER: ... between now and January or December, or whenever those contests...

(CROSSTALK)

BRAZILE: They could change in two weeks. We don't know.

BLITZER: ... take place.

Guys, thanks very much, Donna Brazile, J.C. Watts.

BRAZILE: Thank you.

WATTS: Thank you.

BLITZER: Want to get to the audiotape now.

We have been telling you that we have received a copy now of the audiotape of the arrest of Senator Larry Craig, Republican of Idaho, at that Minneapolis men's room. That was back in June.

And, as that arrest occurred, the arresting police officer recorded the exchange that began after he arrested Senator Craig. And we're going to play the audiotape that has just been released.

(BEGIN AUDIO CLIP)

DAVE KARSNIA, INVESTIGATIVE SERGEANT: No. No. I'm not going to go to court unless you want me there.

SEN. LARRY CRAIG (R), IDAHO: Because I don't want to be in court either.

KARSNIA: OK. I don't either. (INAUDIBLE) Here's the way it works. You will be released today, OK?

CRAIG: OK.

KARSNIA: All right. I know I can bring you to jail, but that's not my goal here, OK?

(CROSSTALK)

CRAIG: Don't do that. You -- you...

KARSNIA: I'm not going to bring you to jail.

CRAIG: You solicited me.

KARSNIA: OK. We're going to get -- we're going to get into that. (INAUDIBLE)

CRAIG: OK.

KARSNIA: But there's -- there's two ways, yes. You can, you can -- you can go to court. You can plead guilty.

CRAIG: Yes.

KARSNIA: There will be a fine. You won't have to explain anything. (INAUDIBLE) And you will pay a fine. You will there. It will be done. Or, if you want to plead not guilty -- and I can't make these decisions for you.

CRAIG: No, no. Just tell me where I am (INAUDIBLE)

(CROSSTALK)

CRAIG: I need to make this flight.

KARSNIA: OK. And then I go to -- if you are not guilty, then I would have to come to court and I would have to testify to what I saw, OK? So, those are the two things, OK? Did I explain that part?

CRAIG: Yes

KARSNIA: OK. I'm just going to read you your rights real quick, OK? You got it on?

NOEL NELSON, DETECTIVE: Yes. KARSNIA: OK.

The date is 6/11/07 at 12:28 hours.

Mr. Craig?

CRAIG: Yes.

KARSNIA: All right. Sorry about that.

You have the right to remain silent. Anything you say can and will be used against you in court of law. You have the right to talk to a lawyer now or have a present -- a lawyer present now or any time during questioning.

If you cannot afford a lawyer, one will be appointed to you without cost.

Do you understand each of these rights the way I have explained them to you?

CRAIG: I do.

KARSNIA: Do you wish to talk to us at this time?

CRAIG: I do.

KARSNIA: OK. I just want to start off with a your side of the story, OK? So...

(CROSSTALK)

CRAIG: So, I go into the bathroom here, as I normally do. I'm a commuter through here.

KARSNIA: OK.

CRAIG: I sit down to go to the bathroom. And you said our feet bumped. I believe they did, because I reached down and scooted over, and the next thing I knew, under the bathroom divider comes a card that says "Police."

Now, that's about as far as I can take it. I don't know of anything else. Your foot came toward mine. Mine came towards yours. Was that natural? I don't know. Did we bump? Yes. I think we did. You said so. I don't disagree with that.

KARSNIA: OK. I don't want to get into a pissing match here.

CRAIG: We're not going to.

KARSNIA: Good.

CRAIG: I don't -- I am not gay. I don't do these kinds of things and...

(CROSSTALK)

KARSNIA: That doesn't matter. I don't care about sexual preference or anything like that.

Here's your stuff back, sir. I don't care about sexual preference.

CRAIG: I know you don't. You're out to enforce the law.

KARSNIA: Right.

CRAIG: But you shouldn't be out to entrap people either.

KARSNIA: This isn't entrapment.

CRAIG: All right.

KARSNIA: You -- you're -- you're skipping some parts here, but what about your hand?

CRAIG: What about it? I reached down with my foot like this. There was a piece of paper on the floor. I picked it up.

KARSNIA: OK.

CRAIG: What about my hand?

KARSNIA: Well, you're not being truthful with me. I'm kind of disappointed in you, Senator. I'm really disappointed right now.

OK? I'm not -- just so you know, just like everybody...

CRAIG: Yes?

KARSNIA: I treat with dignity. I try to pull them away from the situation.

(CROSSTALK)

KARSNIA: ... not embarrass them.

CRAIG: I appreciate that.

KARSNIA: And I...

CRAIG: And you did that after -- and I know that (INAUDIBLE)

KARSNIA: I will say every person I have had so far has told me the truth. We have been respectful to each other, and then they have gone on their way. And I have never had to bring anybody to jail because everybody's been truthful to me.

CRAIG: I don't want you to take me to jail. And I think...

(CROSSTALK)

KARSNIA: I'm not going to take you to jail as long as you be cooperative, but I -- I'm not going to lie. We...

CRAIG: Did my hand come below the divider? Yes, it did.

KARSNIA: OK. Sir, we deal with people that lie to us every day.

CRAIG: I'm sure you do.

(CROSSTALK)

KARSNIA: I'm sure you do too, sir.

CRAIG: And, gentleman, so do I.

KARSNIA: I'm sure you do. We deal with a lot of people that are very bad people. You're not a bad person.

CRAIG: No, I don't think I am.

KARSNIA: OK. So what I'm telling you is, I don't want to be lied to.

CRAIG: OK.

KARSNIA: OK.

So, we will start over. You're going to get out of here. You're going to have to pay a fine, and that will be it. OK? And I don't call media. I don't do any of that type of crap.

CRAIG: Fine.

KARSNIA: OK?

CRAIG: Fine.

KARSNIA: All right, so let's start from the beginning. You went in the bathroom.

CRAIG: I went in the bathroom.

KARSNIA: And then what did you do when you...

(CROSSTALK)

CRAIG: I stood beside the wall, waiting for a stall to open. I got in the stall, sat down. I started going to the bathroom. Did our feet come together? Apparently, they did bump. Well, I won't dispute that.

KARSNIA: OK. When I got out of the stall, I noticed other -- other stalls were open.

(CROSSTALK)

CRAIG: They were at the time. At the time I entered, I -- I -- at the time I entered, I stood and waited. KARSNIA: OK.

CRAIG: They were all busy, you know?

KARSNIA: Were you right at me while you were waiting? I could see your eyes. I saw you playing with your fingers, then look up, play with your fingers, and then look up.

CRAIG: Did I glance at your stall? I was glancing at a stall right beside yours waiting for a fellow to empty it. I saw him stand up. And, therefore, I thought it was going to empty.

KARSNIA: How long do you think you stood outside the stalls?

CRAIG: Oh, a minute or two at the most.

KARSNIA: OK. And, when you went in the stall, then what?

CRAIG: Sat down.

KARSNIA: OK. Did you do anything with your feet?

CRAIG: Positioned them, I don't know. I don't know at the time. I'm a fairly wide guy.

KARSNIA: I understand.

(CROSSTALK)

CRAIG: I bend to spread my legs...

KARSNIA: OK.

CRAIG: ... when I lower my pants so they won't slide.

KARSNIA: OK.

CRAIG: Did I slide them too close to yours? Did I -- I looked down once your foot was close to mine.

KARSNIA: Yes.

CRAIG: Did we bump? You said so. I don't recall that, but apparently we were close.

KARSNIA: Yeah. Well, your foot did touch mine, on my side of the stall.

CRAIG: All right.

KARSNIA: OK? And then with the hand. How many times did you put your hand under the stall?

CRAIG: I don't recall. I remember reaching down once -- there was a piece of toilet paper back behind me -- in picking it up.

KARSNIA: OK. Was your -- was your palm down or up when you were doing that?

CRAIG: I don't recall.

KARSNIA: OK. I recall your palm being up. OK?

CRAIG: All right.

KARSNIA: When you pick up a piece of paper off the ground, your palm would be down, when you pick something up.

CRAIG: Yeah, probably would be. I recall picking the paper up.

KARSNIA: And I know it's hard to describe here on tape, but, actually, what I saw was your fingers come underneath the stalls. You were actually touching the bottom of the stall divider.

CRAIG: I don't recall that.

KARSNIA: You don't recall...

(CROSSTALK)

CRAIG: I don't believe I did that. I don't.

KARSNIA: I saw -- I saw...

CRAIG: I don't do those things.

KARSNIA: I saw your left hand. And I could see the gold wedding ring when it when it went across. I could see that. On your left hand, I could see that.

CRAIG: Wait a moment. My left hand was over here.

KARSNIA: I saw -- there's a...

CRAIG: My right hand was next to you.

KARSNIA: I could tell it with my -- I could tell it was your left hand, because your thumb was positioned -- in a faceward motion, your thumb was on this side, not on this side.

CRAIG: Well, we can dispute that. I'm not going to fight you in court.

(CROSSTALK)

KARSNIA: But I -- I reached down with my right hand to pick up the paper.

But I'm telling you that I could see that, so I know that's your left hand. Also, I could see a gold ring on this finger, so that it's obvious it was the left hand.

CRAIG: Yeah, OK. My left hand was in the direct opposite of the stall from you. KARSNIA: OK.

You -- you travel through here frequently, correct?

KARSNIA: I do, almost weekly.

KARSNIA: Have you been successful in these bathrooms here before?

CRAIG: I go to that bathroom regularly.

(CROSSTALK)

KARSNIA: I mean for any type of other activity?

CRAIG: No, absolutely not. I don't seek activity in bathrooms.

KARSNIA: It's embarrassing.

CRAIG: Well, it's embarrassing for both. But I'm not going to fight you.

KARSNIA: I know you're not going to fight me, but that's not the point. I would respect you. And I still respect you. I don't disrespect you. But I'm disrespected right now.

And I'm not tying to act like I have all kinds of power or anything, but you're sitting here lying to a police officer.

(CROSSTALK)

KARSNIA: That is not a (INAUDIBLE) I'm getting from somebody else. I'm...

(CROSSTALK)

KARSNIA: I have been trained in this.

(CROSSTALK)

KARSNIA: I have been trained in this, and I know what I am doing.

(CROSSTALK)

KARSNIA: And I saw you put your hand under there. And you're going to sit there and...

CRAIG: I admit I put my hand down.

KARSNIA: You put your hand and rubbed it on the bottom of the stall with your left hand.

CRAIG: No. Wait a moment.

KARSNIA: And I'm -- I'm not dumb. You can say, I don't recall...

(CROSSTALK)

CRAIG: If I had turned sideways, that was the only way I could get my left hand over there.

KARSNIA: It's not that hard for you to reach...

(CROSSTALK)

KARSNIA: It's not that hard. I see it happen every day out here now.

CRAIG: (INAUDIBLE) You do. All right.

KARSNIA: I'm just -- I'm just -- I guess -- I guess I'm going to say I'm just disappointed in you, sir. I just really am. I expect this from the guy that we get out of the hood. But, I mean -- I mean, people vote for you.

CRAIG: Yes, they do.

(CROSSTALK)

KARSNIA: Unbelievable. Unbelievable.

CRAIG: And I'm a respectable person. And I don't do these kinds of...

(CROSSTALK)

KARSNIA: ... respect right now, though.

CRAIG: But I didn't use my left hand.

KARSNIA: I saw...

(CROSSTALK)

CRAIG: I reached down with my right hand like this to pick up a piece of paper.

KARSNIA: Was your gold ring on your right hand at any time today?

CRAIG: Of course not. Try to get it off. Look at it.

KARSNIA: OK. Then it was your left hand. I saw it with my own eyes.

CRAIG: All right, you saw something that didn't happen.

(END AUDIO CLIP)

BLITZER: And there it is, the audiotape, the arresting officer's conversation with Republican Senator Larry Craig of Idaho,the day, June, 11, 2007, when he was arrested at that Minneapolis airport restroom.

Jeff Toobin is our senior legal analyst. He's here in THE SITUATION ROOM.

You heard it. You heard him waive his Miranda rights at the beginning, saying he had the right to remain silent. He waived that. He said he's more than happy to talk about it.

Give us your legal analysis of what we just heard.

JEFFREY TOOBIN, CNN SENIOR LEGAL ANALYST: Well, I think there's good news and bad news.

The good news for Larry Craig is, I don't think there's anything in this tape that makes the situation worse. The bad news is, his situation is terminal anyway. So, this really just doesn't make any difference.

But what you have to do is read this or listen to this transcript and compare it to the arrest report by this sergeant, Sergeant Dave Karsnia, who talks about all the things he saw Larry Craig do, linger outside the terminal, try to make -- outside the stall -- try to make eye contact, make repeated gestures underneath the stall.

So, that's why you can see Karsnia getting so irritated, because his version of what went on is completely different from what Craig describes on this tape.

BLITZER: Because a lot of the arguments that Senator Craig makes in this audio exchange, he could have made if he decided to plead not guilty, and gone to trial or whatever, gone to court to fight it. He could have made the case.

But, yet, for some reason, he decided that he was going to plead guilty.

TOOBIN: Exactly. That is why this is essentially so irrelevant, because this is actually a fairly good defense at trial, that the detective simply misinterpreted a gesture I made. This was all a big misunderstanding.

And, if we were at the stage where Craig had been charged and he was awaiting trial, we would say, oh, OK, let's have a trial and see who the jury believes.

But he has pled guilty. So, this story is irrelevant.

BLITZER: Because, and some of the arguments he made could have been deemed, well, that sort of makes sense. It could have simply been just a big misunderstanding between those two stalls.

TOOBIN: And the jury could have listened to the detective and listened to Craig and decided who was telling the truth. We're not going there, because he has already pled guilty. He said he's done it. He said he did it.

BLITZER: And -- and Dana Bash is on the scene for us in Boise, Idaho.

Dana, as you listened to this audiotape -- you heard his explanation earlier in the week, why he decided that he wasn't going to plead innocent, not guilty, why he decided to plead guilty.

What do you think, listening to the audiotape?

DANA BASH, CNN CONGRESSIONAL CORRESPONDENT: Well, you just heard a very good legal explanation from Jeff there.

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