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Supporters of Battling Democrats Trade Insults; Is McCain Managing his Campaign Time?; Justice Department Approves Merger of XM Radio & Sirius Satellite Radio

Aired March 24, 2008 - 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, fighting words between the Clinton and Obama camps. Are charges of McCarthyism and a Judas- like betrayal dragging down the Democrats? Coming up, I'll ask Clinton supporter James Carville about his contribution to all the negativity.
Also this hour, who wins the White House when the economy goes south? We're tracking historical trends and whether they'll be thrown out the window this election year.

Plus, John McCain urging Republicans to show him the money. With a clear shot to the GOP nomination, McCain is out campaigning for cash, but some supporters fear he's not making the most of it.

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

Allies to Hillary Clinton and Barack Obama are pushing either other's buttons big time. They're trading one startling insult after another, invoking a biblical betrayal, a witch hunt for communists, and a much more recent political scandal. Now some Democrats fearing a major backlash are urging both sides to simply cool it.

Let's begin our coverage this hour with CNN's Jim Acosta. He's watching this story for us.

Jim, there have been some very serious fighting words, the accusations being hurled by the Obama and Clinton camps very intense over the past couple days or so. Update us on what the latest is.

JIM ACOSTA, CNN CORRESPONDENT: Well, Wolf, you can start with the campaign conference calls that started this morning. Consider what the Obama campaign had to say. They said, "Questioning patriotism, we don't think that has a place in this campaign."

Then take a look at what the Bill Clinton -- excuse me, the Hillary Clinton campaign said in its conference call this morning, calling what has happened over the last few days "... gutter tactics that the campaign is now deploying."

And just to back up and explain what all of this means, essentially a lot of this started on Friday with Bill Clinton's trip to Charlotte, North Carolina, when he seemed to say that Barack Obama's patriotism -- or according to the Barack Obama campaign, that Barack Obama's patriotism was somehow questionable. Bill Clinton saying, "I think it would be a great thing if we had an election year where you had two people who loved this country." Barack Obama's campaign took that as a shot as his patriotism.

And then you had Tony McPeak, the retired Air Force general, essentially saying that Bill Clinton was resorting to McCarthyistic tactics. And then juxtapose that with what happened after the Bill Richardson endorsement of Barack Obama.

That came down also on Friday, but on that same day, James Carville, a Hillary Clinton supporter, said, and I quote, that "... Richardson's endorsement came right around the anniversary of the day when Judas sold out for 30 pieces of silver." Then on one of the Sunday talk shows yesterday, Bill Richardson fired back at James Carville.

(BEGIN VIDEO CLIP)

GOV. BILL RICHARDSON (D), NEW MEXICO: Well, I'm not going to get in the gutter like that. And you know, that's typical of many of the people around Senator Clinton. They think they have a sense of entitlement to the presidency.

(END VIDEO CLIP)

ACOSTA: And if matters could not get worse, consider what Gordon Fischer, the former Iowa Democratic Party chairman, said on his blog.

The quote has been taken off of his blog, but he said about Bill Clinton, "This is a stain on the former president's legacy. Much worse, much deeper than the one on Monica Lewinsky's blue dress."

He has since taken that posting from his blog down and apologized, Wolf, saying that his comments were tasteless. Gordon Fischer, an Obama supporter.

ACOSTA: That's right.

BLITZER: What have we heard, if anything, from Barack Obama or Hillary, for that matter, over all these accusations going back and forth over the past couple of days. Have either of them decided to directly enter the fray, or are they just letting their surrogates and their supporters speak out?

ACOSTA: At this point, the war words appear to be coming between these two sides, their surrogates. Obama is vacationing at this point down in the Caribbean. Hillary Clinton gave that major policy speech this morning on the foreclosure crisis, but she did not talk about these wars of words that have been going on over the last several days -- Wolf.

BLITZER: All right. It's getting nastier by the minute out there. Thanks very much.

The stakes are clearly intense, as Jim Acosta has been reporting. Hillary Clinton is trying to stay above the fray. She's focusing in on the nation's mortgage crisis on this day. Speaking in Pennsylvania, she proposed greater protections for lenders from possible lawsuits, an idea often associated with the Republicans. She also urged President Bush to appoint an emergency panel to recommend ways to confront the rise in home foreclosures.

(BEGIN VIDEO CLIP)

SEN. HILLARY RODHAM CLINTON (D-NY), PRESIDENTIAL CANDIDATE: Our economic crisis is at its core a housing crisis. A crisis caused in part by unscrupulous mortgage lenders and brokers and unregulated transactions in mortgage-backed securities, in part by speculators who were buying multiple houses to sell for a quick buck, and other buyers who didn't act responsibly. And in part by a President and administration who failed to anticipate and continue to downplay the problems we face.

(END VIDEO CLIP)

BLITZER: Senator Clinton, by the way, has the Democratic campaign trail to herself today. Senator Obama's vacationing with his family in the U.S. Virgin Islands.

Coming up, we'll have much more on Senator Clinton's day and on the problems in the housing market. Also, we're standing by to speak with one of her major supporters, James Carville. He's going to be here in THE SITUATION ROOM.

While the Democrats are duking it out, John McCain is trying to fill up his campaign coffers. The all-but-certain Republican nominee is back on the campaign trail today, looking for cash and votes in an important fall battleground.

Let's go out to Dana Bash. She's covering this story for us in California.

Here's the question some are asking. Is Senator McCain making the most of his time that he has right now?

DANA BASH, CNN CONGRESSIONAL CORRESPONDENT: Well, you know, Wolf, Republicans I talk to say that he's doing pretty well in uniting the Republican Party behind him. He is doing surprisingly well in some recent polls that show him doing, again, well against both Democratic candidates. But whether or not his campaign is adequately preparing for the fall campaign, that is being hotly debated right now in Republicans circles.

(BEGIN VIDEOTAPE)

BASH (voice-over): Snapshots from John McCain's week on the world stage, images of the presumptive GOP nominee trying to use this time wisely.

WHIT AYERS, REPUBLICAN STRATEGIST: When the other side is tearing itself apart, you don't want to be distracting the public from watching that food fight. You need to be spending your time raising money.

BASH: McCain's been doing that since effectively locking up the nomination more than six weeks ago. Yet, on the fundraising front, he is dramatically outpaced by the Democrats.

Last month, Hillary Clinton raised nearly $35 million. Barack Obama, more than $55 million. John McCain, only $11 million. McCain officials insist his intense fundraising schedule this month and new assistance from veteran GOP money men is helping.

SEN. JOHN MCCAIN (R-AZ), PRESIDENTIAL CANDIDATE: I want your vote.

BASH: As some McCain supporters tell CNN, they worry the campaign is not using this time wisely in other ways -- slow to develop a clear message. McCain advisers insist they're on track...

MCCAIN: We all know that America's hurting now.

BASH: ... with plans to unveil new policy ideas this week on the economy, one of McCain's weak spots, and a speech on what aides call his strength, national security.

Republican strategists say cultivating McCain's appeal among Independents is critical right now.

AYERS: Independents want solutions to be reached. The more the Democrats tear each other up, the better John McCain looks as a problem solver. .

BASH: Democrats are already working to blunt his inroads with Independents, like with this new Web video.

MCCAIN: I believe that Saddam Hussein presents a clear and present danger to the United States of America with his continued pursuit to acquire weapons of mass destruction.

I never said that it was a "clear and present danger because of weapons of mass destruction."

(END VIDEOTAPE)

BASH: And that's another really prime example, Wolf, of the challenge -- one of the challenges that John McCain has right now, is that Democrats know who their opponent is. He may not, but Democrats certainly know that he is going to be their opponent in the fall, and they are hitting him, pounding him on a daily basis.

That is one reason McCain advisers know that they are going to have to define him before somebody else can. One reason why next week, all week, he's going to go on a bio tour, touting his biography and his experiences along the way. Really, pretty much his whole career from the military on -- Wolf.

BLITZER: All right, Dana. Thanks.

Dana's in Chula Vista getting ready to listen to a McCain event over there.

Let's join Jack Cafferty. He's joining us this week with "The Cafferty File."

Hi, Jack.

JACK CAFFERTY, CNN ANCHOR: I'll be here Monday through Friday.

BLITZER: Excellent. I'm happy you will be.

CAFFERTY: All five days.

BLITZER: Good.

CAFFERTY: Unlike some other members of...

BLITZER: Do you ever take a day off, Jack?

CAFFERTY: Not very often. But I take more than you do, so I withdraw the criticism.

All right. Here we go.

On two different occasions, Senator Hillary Clinton has described a trip she took as first lady to Bosnia in March of 1996. To hear her tell it, she was lucky to escape with her life.

Landing in a hail of sniper fire, she said they were forced to cut short the greeting ceremony at the airport and "run with our heads down to get into the vehicles to get to our base." But, apparently there was time to stop and visit at the airport with an 8-year-old girl who greeted Mrs. Clinton on the tarmac when she landed and read her a poem.

The military commander on hand to greet Clinton at the time, Major General William Nash, told "The Washington Post" he was unaware of any sniper threat to Clinton during her eight-hour stay. Also traveling with the first lady was her daughter Chelsea, the singer Sheryl Crow, and comedian Sinbad, who said the scariest part of that trip to Bosnia was deciding where to eat. Hillary Clinton claims she was sent to places that her husband, then-President Bill Clinton, could not go because they were too dangerous.

Back to Sinbad. When commenting on Clinton's version of events, he said, "What kind of president would say, 'Hey, man, I can't go, because I might get shot, but I'm going to send my wife and daughter. Oh, and take a guitar player and a comedian with you too.'"

"The Washington Post" has awarded Senator Clinton Four Pinocchios for this story about Bosnia, which it hands out for what it calls major whoppers. Now that all this has come to light, well, this afternoon, Clinton's campaign (INAUDIBLE) how she may have "misspoke," is the word they use, about her 1996 trip to Bosnia.

So, here's the question: Why would Hillary Clinton not tell the truth about her trip to Bosnia in March of 1996? Go to cnn.com/caffertyfile and post a comment on my blog.

Pictures are worth a thousand words, don't you think, Wolf?

BLITZER: Well, I remember when she went to Bosnia in 1996. And I've got to tell you, the overall environment was still dangerous over there, although they cleaned out that airport area pretty much to make it safe for the first lady. But if you read some of the stories at the time, you know, she was going into a relatively dangerous area, but clearly not as dangerous as she makes it out to be right now.

CAFFERTY: Did you see the picture of Chelsea and the little girl?

BLITZER: Yes, I saw that picture. I remember...

CAFFERTY: Terrifying stuff, isn't it?

BLITZER: And Sinbad was obviously very scared about it as well.

CAFFERTY: Terrified, absolutely.

BLITZER: Jack, stand by. We'll get back to you.

As we've heard, Governor Bill Richardson is getting some grief for endorsing Barack Obama over Hillary Clinton.

(BEGIN VIDEO CLIP)

RICHARDSON: I owe a lot to Senator Clinton and to President Clinton, to the Clinton family, but I served well. I paid it back in service to the country.

(END VIDEO CLIP)

BLITZER: Clinton supporter James Carville isn't necessarily buying that. But did he go too far in likening Richardson to Judas? I'll ask James Carville if he stands by that provocative remark. That's coming up next.

Plus, has the housing market finally bottomed out? Ali Velshi is standing by to crunch the latest numbers.

And U.S. troops in Iraq dying for our country. With the death toll now hitting 4,000, will the war reemerge as a top presidential issue in this campaign?

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

(COMMERCIAL BREAK)

BLITZER: James Carville has rarely, if ever, been accused of biting his tongue, but some say his criticism of Governor Bill Richardson was out there, even for James Carville. We know this much -- Carville's suggestion that Richardson's endorsement of Barack Obama amounted to a Judas-like betrayal of Hillary Clinton got lots of Easter weekend attention.

Joining us now, the Clinton supporter, the CNN contributor, James Carville.

James, thanks for coming in.

JAMES CARVILLE, CLINTON SUPPORTER: Good to be here.

BLITZER: Here's what "The New York Times" quoted you Friday -- excuse me -- Saturday as saying. "Mr. Richardson's endorsement came right around the anniversary of the day when Judas sold out for 30 pieces of silver, so I think the timing is appropriate, if ironic."

Is that an accurate quote?

CARVILLE: Yes. A fellow by the name of Mr. Healy called me and told me about it.

BLITZER: He's the reporter?

CARVILLE: For "The New York Times."

And I have to say that he quoted me accurately and in context. It was -- yes, that's exactly what I said. And by the way, I think the quote had the desired intent.

BLITZER: What was that?

CARVILLE: That people saw Richardson and saw somebody who was disloyal.

BLITZER: So you're not backing away at all from calling him a Judas?

CARVILLE: No, of course not. Well, I mean, it's a seasonal metaphor I was using. But when people see it, that was -- that was -- it had -- it was -- it was what I said and it was quoted accurately, and it had its desired intent.

BLITZER: What were the 30 pieces of silver he got in exchange?

CARVILLE: Well, again, that was a biblical thing. History will -- we'll see.

BLITZER: Are you suggesting there was a deal or something?

CARVILLE: I was using a biblical metaphor and it had -- it had the desired intent. People called me left and right and said, "Whenever I see that guy, I'll can't help but think of that quote."

And I'm saying that I thought -- you know, I never said a word to Senator Kennedy. He's a friend of mine. I was on this very set with Senator Daschle a few days ago, who he and his wife Linda are dear friends of mine. I think the world of him."

I'll be so for Senator Obama if he's the party's nominee. A (INAUDIBLE) and be in General Axelrod's Marine Corps from day one. I was -- I thought this was an egregious act, and I thought it deserved a comment.

BLITZER: Why? I mean, he ran against Hillary Clinton for the Democratic nomination.

CARVILLE: Because, again...

BLITZER: What was -- what was so much of a betrayal?

CARVILLE: In my view -- first of all, twice served the administration, and I felt -- my own personal view was, is that this deserved a response. And I'm very satisfied with the response I gave.

BLITZER: But why was it such a betrayal? Because he makes the point, look, I ran against Hillary Clinton.

CARVILLE: Again, I think the world of Senator Kennedy, have never said one thing, or Senator Kerry, or --

(CROSSTALK)

BLITZER: So why is Richardson different?

CARVILLE: Because I think that there was -- that he served in the cabinet in two different positions. I think that he invited President Clinton to come to his Super Bowl party.

I think that things, to me, to James Carville -- see, I'm not -- if there's something that I think is outrageous, I'll comment on it. I'll completely be for Senator Obama. I think the world of his supporters. All of them -- many of them are dear, dear friends of mine, have been, as far as I'm concerned will continue to be.

I -- just, maybe I have a different sort of code than people in Washington. I don't know, maybe I do. This just seemed to -- it seemed to strike me the wrong way, and I was quoted very accurately and very much in context by this fellow, Mr. Patrick Healy.

BLITZER: Here's what Governor Richardson said yesterday. He said, "I'm not going to get in the gutter like that. And you know, that's typical of many of the people around Senator Clinton. They think they have a sense of entitlement to the presidency."

CARVILLE: I have no idea what he's talking about. And by the way, I never talked to Senator Clinton about this. Her people said we should be talking about health care.

So I don't know -- I have no idea of what he's talking about. I don't have any sense of entitlement of anything. I never served in the administration, I never lobbied anybody, I never made -- I never did any of that. But again, I gave the quote, I knew what I was doing, I knew what its effect would be when I gave it, and it's effect has been predictable.

BLITZER: And so your bottom line is, you think that Bill Richardson, having served as Bill Clinton's energy secretary, the U.N. ambassador, he owed...

CARVILLE: Right, and other -- right.

BLITZER: He owed Bill Clinton.

CARVILLE: What he did is certainly could have stayed neutral, in my opinion. And I wanted to use a very strong metaphor to make my point.

And that's -- and again, I would be very, very -- many, many of Senator -- David Axelrod is a dear friend of mine. And they will be friends of mine. And if he wins the nomination, I'll be a thousand percent supportive. I doubt if Governor Richardson and I will be particularly close in the future.

BLITZER: I doubt it too. With what you've just said here, it's going to be tough to see a reconciliation on that one. Although stranger things have happened here.

CARVILLE: Stranger things -- stranger things have happened. I've had my say.

BLITZER: All right.

Judas, his betrayal led to the downfall obviously of Jesus. Is Bill Richardson that important?

CARVILLE: I don't think -- no, I don't think he's that important. It was a metaphor I was using. I mean, you do these things, and people come up and say, you're comparing and everything else. I wanted -- I got one in the wheelhouse and I tagged it.

BLITZER: All right.

Hillary Clinton is behind in the pledged delegates, and it doesn't look likely she's going to get ahead in the pledged delegates when all the contests are resolved. She's behind in the popular vote right now. It doesn't look like she's going to be ahead now that Florida and Michigan are no longer apparently in the ballgame.

Do you see any way right now she can still emerge as the -- walk me through the process how she can be the Democratic nominee.

CARVILLE: First, let's start, Wolf, because you and I are both sports fans, and we love basketball and this tournament. There's somewhere between 8 and 9 percent of Democrats live in Florida and Michigan. So, would you stop a game, a 40-minute game, with three- and-a-half minutes left to go? Of course you would not.

And you saw on this set with Senator Daschle and I, they clearly did everything they could do to block these Florida and Michigan Democrats from voting. So, there's no real authority to claim a popular vote mandate when you still have 36 minutes and 30 seconds left to go to be played. You've got three minutes left in this contest. I think the party would have been much better or would be better if we came and had a party-run primary in these states, allowed these Democrats to vote.

BLITZER: But that's not happening.

CARVILLE: Well, again, it's not happening because Senator Obama doesn't want it to happen. And, you know, let's run this thing out in Pennsylvania, North Carolina, Indiana, Oregon, West Virginia, Kentucky, and Puerto Rico.

And let's let these Democrats -- you know, it's not up to politico.com to determine who the Democratic nominee is. It's up to Democratic voters, and at the end of this process, if it's clear that Senator Obama's got the nomination, again, this is one corporal who will sew its chevrons back on, salute, and fall in line.

But I'm not going to substitute my judgment for these Democrats. And I think it is a terrible mistake for this party to play a game only 36 and 30 seconds of a 40-minute game here.

I think that the Obama people severely disagree. That's a sign of weakness on their part. They should have let these Democrats in Florida and Michigan vote. And I think these superdelegates are very aware of what happened, and I think it's going to weigh very heavily...

BLITZER: Would it be OK if the superdelegates overruled the pledged and the popular...

CARVILLE: Well, there's no pledged. It's only -- it's like saying that the team won the game, but there's still 3.5 minutes to go.

BLITZER: Because Florida and Michigan...

CARVILLE: Because Florida and Michigan haven't come in.

BLITZER: So it would be...

CARVILLE: So, if she does well -- she has to do very well. Remember, it was on this set that I was the first person that said she had to carry Ohio and Texas. She obviously has to...

BLITZER: And then you said if she carries Pennsylvania, she'll be the nominee.

CARVILLE: Right, she has to carry. If she doesn't carry Pennsylvania...

BLITZER: So if she carries Pennsylvania, will she be the nominee?

CARVILLE: I think she'll have a pretty good chance, because it will carry through to places like North Carolina and Indiana. You know, she'll have to keep -- she'll have to keep the ball rolling, but I think if she does, if she has a good win in Pennsylvania, she can.

I think the best solution would have been to go to post in Florida and Michigan, because that way you show strength. You know, Georgetown and that Davidson game, you couldn't watch that game. Nobody wanted that game to end with 3.5 minutes left to go.

And basically, that's what the Obama people did, is they stopped the clock. And that's not -- I don't think that's good politics. I'll be for him, I think he's a great guy, but I think that's the wrong tactic to take.

BLITZER: And so because Florida and Michigan are no longer at play, apparently, right now, you say that even if he's ahead in the pledged delegates, that's irrelevant?

CARVILLE: Well, the superdelegates are going to know that. They're going to know it. How can you be --

(CROSSTALK)

BLITZER: But it would be OK for the superdelegates to overrule that?

CARVILLE: Well, they're going to do what they're going to do. My point is, if you haven't played the game, you can't -- if we go to the nationals' game and the team is down at the end of seven innings, you don't call the game. There's not a -- you play it.

And you've got to -- you must play -- you have to let this thing go out. The superdelegates are going to certainly take that as a factor when they make up their minds. But maybe it's Senator Obama winning Pennsylvania, maybe he'll run the table. If he is, count me first in line to be for him.

BLITZER: James Carville, thanks for coming in.

CARVILLE: Thank you, Wolf.

BLITZER: Coming up in the next hour, by the way, we'll speak with an Obama supporter, the former senator Gary Hart.

Also coming up, the battered U.S. housing market finally gets a boost. Home sales rose unexpectedly last month, but as sales increase, are home prices falling? What that could mean for you, that's coming up.

And President Bush gets a White House visit from the Easter Bunny and thousands of kids. It's a 130-year-old tradition rolling your way.

A lot more coming up right here in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: To our viewers, you're in THE SITUATION ROOM. Happening now, some say it's mathematically impossible, but is it? Can Hillary Clinton stack up enough delegates to win the Democratic nomination over Barack Obama after all? We're adding up the numbers.

Risky journey. Thousands of Cubans make a desperate trip to the U.S. each year, but we'll see if things might change now that Fidel Castro's brother is in charge.

And what's supposed to be a symbol of unity is igniting protests. Pro-Tibet demonstrators greeted the Olympic torch at the ancient birthplace of the games as it set off on a multi-continent journey to Beijing.

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

It's the number one issue for voters right now, and the state of the U.S. economy could decide who wins the White House. Democrats are banking on that, but do economic indicators actually give them an advantage?

Mary Snow has been looking into this story for us.

Mary, you spoke to someone who actually had a formula to try to figure all of this out. What's going on?

MARY SNOW, CNN CORRESPONDENT: Well, Wolf, one economy professor I spoke with at Yale says economic growth and inflation could be strong indicators of who will win the presidential election. It's just one of several forecasts giving Democrats the edge in 2008.

(BEGIN VIDEOTAPE)

SNOW (voice-over): Slumping home prices, higher gas bills, layoff worries, these are issues that are not only fueling fears of prolonged recession, some say they can also predict the party winner in the next presidential election. One forecast measures economic growth, job creation, and the president's approval rating.

Political science professor, Charles Tien, calculates that as of now, a Democrat could get as much as 54 percent of the vote in November.

PROF. CHARLES TIEN, HUNTER COLLEGE: Right now the numbers would indicate that the Democrats are going to have an easy time next year.

SNOW: Another model by Yale economic professor Ray Fair, author of "Predicting Presidential Elections and Other Things," shows right now Democrats would get about 52 percent of the vote. The models vary, but there is one common denominator.

THOMAS MANN, BROOKINGS INSTITUTION: You go back over time and find that when the economy is doing badly, the incumbent president's party is under siege.

SNOW: One example, 1980. Democratic President Jimmy Carter lost in a landslide to Republican Ronald Reagan, following hard economic times. In 1992, Democrats point to the high unemployment rate under then Republican President Bush George Bush as a key reason while Bill Clinton was elected.

AL FROM, FOUNDER & CEO, DEMOCRATIC LEADERSHIP COUNCIL: In 1992 the problem may have been higher unemployment. I think the housing crisis this time has the same kind of effect on voters.

SNOW: But, if Democrats have the edge, why does a recent CNN poll show an equal number of people say they believe Republican John McCain and Democrats Hillary Clinton and Barack Obama would do a good job handling the economy?

STUART ROTHENBERG, EDITOR AND PUBLISHER, "THE ROTHENBERG POLITICAL REPORT": Sometimes, the general impressions of the candidates are more important than their particular policy prescriptions. And John McCain's overall numbers are quite good. And I think that's why he benefits when people ask how he could handle the economy.

(END VIDEOTAPE)

SNOW: But political analysts point out there are lots of variables, and, while the economy is the number-one issue now and will be a key factor, the question is, will it remain the top issue this fall? -- Wolf.

BLITZER: Mary Snow, thank you.

Homeownership, by the way, in the United States has actually risen steadily over the past half-century. According to figures from the Census Bureau, back in 1960, homeownership, the rates stood at just over 62 percent. As of last year, that figure was up to just over 68 percent.

Of course, home prices have been going up steadily as well. The median asking price for a house in the United States has increased almost $77,000 over the past 20 years, when the cost is adjusted for inflation.

When the U.S. economy is bad, the party in power is invariably the one that gets blamed. Senator Chuck Hagel isn't endorsing his fellow Republican John McCain for president, at least not yet. We're talking about what's going on, what's making Hagel hold back. That's coming up in our "Strategy Session."

And Donna Brazile and Terry Jeffrey, they are standing by to join us live right here in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: Carol Costello is monitoring some other important stories incoming to THE SITUATION ROOM right now.

Carol, what is going on? CAROL COSTELLO, CNN CORRESPONDENT: Well, Wolf, a big step forward in a huge deal to tell you about in the world of satellite radio. The Justice Department has now approved the proposed merger between rivals XM and Sirius Satellite Radio, said Sirius' $5 billion buyout of XM would not substantially lessen competition or hurt Consumers. Consumer groups have strongly opposed the merger, saying it could lead to higher costs for listeners.

Detroit's mayor vows to clear his name. Kwame Kilpatrick faces charges he tried to obstruct justice and lied in court about his relationship with his former chief of staff, Christine Beatty. She's charged with perjury and obstruction -- obstruction of justice as well. Both denied any relationship in a lawsuit by two police officers who said they were fired for investigating claims the mayor tried to cover up the affair.

President Bush, first lady Laura Bush, and the Easter Bunny were side by side at the White House today for the annual Easter egg roll. Thousands of children rolled Easter eggs across the South Lawn in a tradition that dates back 130 years. They also got to take part in an Easter egg hunt, face-painting, and magic shows, too -- back to you, Wolf.

BLITZER: Thanks very much, Carol. See you in a few moments.

Many voters right now focusing in on the economy like a laser beam. But could the new death toll in Iraq turn their attention back to the war? We're looking at the possible impact of the number 4,000.

Plus, you just heard James Carville here in THE SITUATION ROOM stand by his very strong criticism of Governor Bill Richardson. Will his Judas remark backfire, though, on Hillary Clinton? Stand by for our "Strategy Session."

And, later, I will ask an Obama supporter, former Senator Gary Hart, to weigh in on the Judas comment and whether all this bitterness is winding up hurting the Democrats.

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

(COMMERCIAL BREAK)

BLITZER: Four thousand, that's how many United States military personnel have now died in Iraq over these past five years. President Bush said today their sacrifice will not go in vain.

(BEGIN VIDEO CLIP)

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: I hope their families know that, you know, citizens pray for their comfort and their strength whether they were the first one who lost their life in Iraq or recently lost their lives in Iraq, that every life is precious in our sight.

(END VIDEO CLIP) BLITZER: Let's go to our senior political analyst, Bill Schneider. He's joining us now from the CNN Election Express, staying in Pennsylvania right now.

Bill, is Iraq the issue, the war in Iraq becoming more prominent in this presidential campaign right now?

WILLIAM SCHNEIDER, CNN SENIOR POLITICAL ANALYST: Not quite yet, but possibly very soon.

(BEGIN VIDEOTAPE)

SCHNEIDER (voice-over): Last week, the country marked five years since the beginning of the war in Iraq, this week, a tragic milestone.

CLINTON: There have now been 4,000 U.S. military deaths in Iraq.

SCHNEIDER: Public opposition to the war has held at around two to one since the November 2006 midterm election. So, why hasn't the war been a bigger issue in the presidential campaign?

Here's a clue. Those who oppose the war say Iraq is not the biggest issue in deciding how to vote for president this year, the economy is, by two to one. So far, we have only seen the primary campaigns. Within each party, the differences over Iraq have not been great. After the 4,000th loss, Barack Obama issued a statement saying, "It is past time to end this war that should never have been waged by bringing our troops home."

Senator Clinton said:

CLINTON: As president, I intend to honor their extraordinary service and the sacrifice of them and their families by ending this war and bringing them home as quickly and responsibly as possible.

(APPLAUSE)

SCHNEIDER: And Senator McCain?

MCCAIN: No one believes that, if you just get the troops out as quickly as possible, there will be anything but chaos, genocide, and we will be back, at much greater cost in American blood and treasure.

SCHNEIDER: A sharp difference, but it's not reflected in the polls.

Right now, Obama supporters and Clinton supporters are almost unanimously opposed to the war. But some 40 to 41 percent of McCain supporters say they too are anti-war.

(END VIDEOTAPE)

SCHNEIDER: That's what campaigns are for, to bring a sharper focus on the differences between the parties and candidates. And nowhere are those differences greater than on Iraq -- Wolf.

BLITZER: Bill Schneider, in Philadelphia for us, thank you.

It's taken five years for the U.S. military death toll in Iraq to reach this number of 4,000. It took more than seven years to reach that grim milestone in the Vietnam War, which ultimately claimed the lives of almost 60,000 U.S. service members.

But both Iraq and Vietnam have had far fewer U.S. military casualties than World War II. Following the U.S. entry into the war that day right after Pearl Harbor, on December 7, 1941, more than 400,000 U.S. service members were killed before the war ended in 1945.

In our "Strategy Session," the Richardson/Obama endorsement. James Carville has compared Governor Bill Richardson to Judas, but was his decision to endorse Obama really a betrayal, or was it good judgment?

And could McCain's support of the war in Iraq cost him GOP votes? Republican Senator Chuck Hagel says he may not endorse his party's nominee. He's watching what's going on.

So are Donna Brazile and Terry Jeffrey. They're standing by well for our "Strategy Session" -- right here in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: James Carville is not backing away at all from his comments comparing Bill Richardson to Judas for endorsing Barack Obama. You heard him just a few moments ago right here in THE SITUATION ROOM.

Let's discuss in our "Strategy Session" right now. Joining us, our CNN political analyst the Democratic strategist Donna Brazile, and conservative commentator Terry Jeffrey. He's the editor in chief of the Cybercast News Service.

James was James. He's not backing away at all. He says, there may be one category of Obama supporters, like Ted -- like Ted Kennedy, he's not criticizing. But, Bill Richardson, who served in the Cabinet as energy secretary, as U.N. ambassador, owes the Clintons more. And he says, this guy betrayed the Clintons, like Judas.

DONNA BRAZILE, CNN POLITICAL ANALYST: I understand James' profound disappointment with Governor Richardson, who I think is one of the best governors in this country.

But, you know, at some point, this just has to stop. There's no reason to compare Governor Richardson or anyone else to Judas. David Wilhelm, who ran Mr. -- Senator -- I mean, President Clinton's campaign, endorsed Obama.

This is one reason why I don't care to endorse, because you can't take a position for one, without them expecting you to get a stick and smack the other. This is the kind of destructive politics that will hurt the Democratic Party.

TERRY JEFFREY, EDITOR IN CHIEF, CYBERCAST NEWS SERVICE: Well, Wolf, James Carville is a friend of the Clintons. He's always done a good job sticking up for them.

But I don't recall anybody around the Clintons accusing Bill Richardson of disloyalty when he was U.N. ambassador, and he offered Monica Lewinsky a job. I think what Bill Richardson has done is symbolic of the decision that all of the elite or superdelegates of the Democratic Party are going to have to make.

There's two things they can say to history. The Democratic superdelegates can either say, we vindicate the Clintons, we're putting Bill Clinton and Hillary Clinton back in the White House, and we accept everything they did when they were there the last time, or they can say, we have a chance for the first time in our history to elect an African-American president, and we're going for that. Bill Richardson went for the latter. And I don't think that was the act of a Judas.

BRAZILE: I think most Democrats will -- superdelegates will say that we put the best person in office, because that's what this election is about, electing the best president of the United States.

It's not an issue of vindication or putting a black person in office. It's an issue of making sure we have somebody who can end this war in Iraq and provide jobs to our people. That's what this is about for many of our superdelegates.

BLITZER: The whole point, though, of the superdelegates, and I -- going back to the '80s -- was that they wanted these people to -- to come up with someone who was the best qualified to beat a Republican, had -- irrespective of what happened in the primary. Those are the rules of the game, Terry. That's the way the rules are.

So, theoretically, even if Obama were to get more pledged delegates, were to get more of a popular vote, if the superdelegates, the party elders, the elected officials, 800 or so of them, thought, you know what, Hillary Clinton has a better chance of beating John McCain, and that's why we're going with Hillary Clinton.

JEFFREY: Well, right. I think the Democratic leadership has put themselves in a real fix.

The only way that Hillary Clinton can be the nominee is if people like Bill Richardson say, we want her because she's more electable than Obama. And, until the problem with Jeremiah Wright emerged last week for Obama -- and I think it's a serious problem -- looking at it from the outside, to me, there didn't seem there was much of a choice. It seemed to me Obama clearly was the better candidate before the Jeremiah Wright scandal.

(CROSSTALK)

BRAZILE: I have gotten so exhausted by Jeremiah Wright, because Jeremiah Wright, a former Marine, a pastor, he's retired, he's not on the ballot. He -- he cannot do one thing to end this war or bring about jobs and keep our economy strong.

(CROSSTALK) BRAZILE: And, yet, the Republicans -- and, Terry, yes, you, too -- you want to keep Jeremiah Wright alive. Why?

JEFFREY: No, but let me ask you...

(CROSSTALK)

BRAZILE: Why do you want to keep him alive?

JEFFREY: Given that Senator Obama has the lead in the pledged delegates, he has the lead in the popular vote, why would any leader of the Democratic Party choose Hillary Clinton, who has lost all these primaries to Barack Obama, over Barack Obama, unless it was because they thought the Jeremiah Wright scandal had perhaps made him unelectable in November? Give me one good reason.

BLITZER: Well, I will give you one that -- and I will interrupt Donna, and then I will let her say -- what James Carville, because I asked him that question

He said, it's not a fair competition right now, because 8 percent of the Democrats are not participating, the Democrats in Michigan and Florida. And, as a result, you have got to throw out all those results, basically, and just go with whatever the superdelegates wind up saying.

BRAZILE: Everyone knew the rules of the game before they got into the contest. Now, we can change the rule to benefit one or the other, but it wouldn't be fair to the 48 states who complied.

BLITZER: And -- and one of the rules is the pledged delegates and the superdelegates, and another rule was that Michigan and Florida, they lose, and the Democrats might wind up losing by alienating a lot of those voters in the process.

BRAZILE: Superdelegates are part -- superdelegates are part of the process, but there are no rules that govern how we should think or how we should cast our ballot. So, it's a matter of principle and a matter of how we look at the process.

JEFFREY: Well, I think the Democrats have made the right decision about Michigan and Florida.

But, unless they think that Senator Obama's relationship with Jeremiah Wright disqualifies him, I don't see how they have a rational argument for taking Senator Clinton...

BLITZER: All right.

JEFFREY: ... and elevating her above Senator Obama.

(CROSSTALK)

BLITZER: I want to -- I want to switch gears and talk about Chuck Hagel in a state . I just want to tell our viewers, a lot more coming up on this whole James Carville/Bill Richardson/Judas feud. Bill Richardson is going to be a guest on "LARRY KING LIVE" later tonight. He is going to have a chance to respond to what we just heard from James Carville.

Here's what Chuck Hagel said yesterday, the Republican senator, who's not seeking reelection from Nebraska: "I want to understand a little more about foreign policy, where he would want to go. Certainly doesn't put me in -- in Obama or Clinton's camp, but John McCain and I have some pretty fundamental disagreements on the future of foreign policy."

How much of a problem is this for John McCain right now, if someone like -- a conservative like -- like a Chuck Hagel is not yet ready to jump on the John McCain bandwagon?

JEFFREY: You know, I'm not sure Senator Hagel's lack of endorsement particularly is a problem for John McCain. I think his inability to win over conservatives is.

But I think what Senator Hagel is saying goes to a much deeper debate going on in conservative ranks than outsiders may know. And that is, John McCain is very much a Wilsonian foreign policy, very much interventionist, even more so than George W. Bush.

Historically, that has not been the position of conservatives. And I think there's going to be a struggle in --

(CROSSTALK)

BLITZER: So, the difference between internationalists vs. the isolationists, which Terry says could be a serious problem for McCain. What do you think?

BRAZILE: I agree with everything Terry just said about the McCain/Hagel feud.

What's interesting, though, is that Senator Hagel made it very clear that he has an open mind, and perhaps he is willing to look down the road at one of the Democrats.

JEFFREY: Wolf, I would just to say internationalist vs. realist, not isolationist. I think the conservative tradition is realistic foreign policy, as opposed to the interventionism of John McCain.

BLITZER: Is Pat Buchanan a realist or an isolationist?

JEFFREY: Well, Pat has his own particular point of view on foreign policy. And some conservatives would debate Pat on his views.

BRAZILE: I just came from church, so I'm not going to say nothing about Pat Buchanan.

BLITZER: We're not going to talk about it.

(LAUGHTER) BLITZER: All right, guys, thanks very much.

The Democrats are trying to change the storyline. Instead of Obama vs. Clinton, they are promoting McCain vs. McCain.

In our next hour: new evidence that politics and protests already are leaving a mark on the Beijing Olympics -- lots more news coming up right here in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: Today, on our Political Ticker: While the Democrats don't have a nominee yet, they do have a clear opponent. The latest Web ad from the Democratic Party targets John McCain's straight talk image.

Let's go to our Internet reporter, Abbi Tatton.

So, Abbi, what are they saying?

ABBI TATTON, CNN INTERNET REPORTER: Wolf, this new Web site from the Democratic National Committee pits Senator John McCain against Senator John McCain, snippets of seemingly contradictory sound bites from the senator, along with plenty of appearances from President Bush and the promise from the DNC that this would be a third Bush term.

The new McCaindebates.com is the latest online push from the Democratic National Committee, going after the presumptive Republican nominee, as the Democrats' focus continues to be on Hillary vs. Obama, something acknowledged by chairman Howard Dean in this fund-raising e- mail that went out last week, urging action: "We can't afford to wait for Hillary Clinton or Barack Obama to win the Democratic nomination."

They are saying that there's going to be more posted to this Web site, more to come. A spokesman for the Republican National Committee called it an effort to distract from the divisive debate within their party -- Wolf.

BLITZER: Abbi, thank you for that.

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

CAFFERTY: The question this hour is: Why would Hillary Clinton not tell the truth about her trip to Bosnia in March of 1996?

Marie in Charleston, South Carolina, writes: "We know the reason: to bolster her foreign policy experience credentials. The sad thing to me is that she has plenty of legitimate credentials to recommend her. This type of resume padding makes people question everything else she touts as experience, which is the crux of her campaign."

Bob in Richmond, Virginia, says: "She was just using a common resume-building technique, citing experience if you are in the general vicinity of a job requirement. She also ignored the number one-resume fudging rule: Don't lie if there are witnesses." Dennis in Spokane, Washington, writes: "'Misspoke' -- that's what he campaign said today she did about this, 'misspoke' -- sure, I always imagine sniper fire when my plane lands. Good that Chelsea survived the trauma of listening to that poem while her mom was getting all those scary flowers."

We're going to show you the picture again in a minute.

Alexa, Lovettsville, Virginia: "For the same reason as Obama lied about being in church when Reverend Wright was on one of his rants, when Obama lied about Rezko, and when Obama lied about his campaign adviser meeting with the Canadians, and when Obama lied about how much money Rezko donated to him, et cetera, et cetera, et cetera. It's called politics."

Stephen in New Jersey writes: "She wouldn't lie about that to get elected, any more than she and Bill would look into the cameras of '60 Minutes' and lie about extramarital affairs in order to get him elected president."

Garnet in Corning, Ohio, writes: "If she was as qualified as she says she is on day one, she wouldn't have to stretch the truth. After this one, I ask America, what else is she stretching the truth about? My boys are dying and being injured for life for one lie. Do we really want another one? Oh, and another thing: What about those tax records, Hillary?"

And, finally, Dan in Texas writes this one: "Besides dodging sniper fire, Hillary single-handedly saves her fellow travelers by frisking down a suspected suicide bomber dressed as an 8-year-old girl. Too funny -- Hillary and Chelsea to the rescue" -- Wolf.

BLITZER: Jack, see you in a few moments. Thank you.

And, to our viewers, you're in THE SITUATION ROOM.

Happening now, the housing crisis hits at the very heart of the American dream, so Hillary Clinton is putting it at the center of her new economic plan announced today. But is it really her plan?

He's already lost to Hillary Clinton in several of the biggest states. Can Barack Obama beat John McCain in the general election? I will speak with a key Obama supporter, the former U.S. Senator Gary Hart.

Detroit's mayor and his former chief of staff charged with felony counts tied to the alleged cover-up of a sex scandal -- all that happening today.

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