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THE SITUATION ROOM

President Campaigns for Health Reform; Defying the Taliban; Lockerbie Bomber Freed; Victim's Parents: It's Very Immoral; Who's Guarding Iraq; Cash for Clunkers Sputtering

Aired August 20, 2009 - 17:00   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: An ailing terrorist convicted of killing 270 people in the bombing of Pan Am Flight 103 has now been freed from prison and returns home to Libya. He gets a hero's welcome there, thousands of folks showing up at the airport. We're going to hear from outraged relatives of the victims and from the Scottish minister who set him free. That's coming up in my exclusive interview.

In an endless wave of bloody attacks, Taliban insurgents did all they could to try to derail Afghanistan's election, but voters turned out today in Kabul. We're going there for you.

And the cash for clunkers program got a lot more cash from Congress, so why is it now coming to a halt? What's going on? I'm Wolf Blitzer. You're in THE SITUATION ROOM.

President Obama is walking a tightrope on health care reform, trying to satisfy the expectations of liberals and ease the concerns of conservatives. Today, he made pitches to both sides.

Let's go live to our our senior White House correspondent, Ed Henry.

He's working the story for us -- some would suggest, Ed -- I don't know if you agree with this assessment -- that the president sounded today a lot more like candidate Obama than he did as President Obama.

ED HENRY, CNN CONGRESSIONAL CORRESPONDENT: Oh, Wolf, no doubt he did -- clearly, hitting conservative talk radio, going out on that circuit, even though the host, in this case, is somebody who endorsed him last year; reaching out to conservative listeners, trying to push back on some of the charges flying around.

But he also was trying to get momentum going by rallying the left.

(BEGIN VIDEOTAPE)

UNIDENTIFIED FEMALE: President Barack Obama.

HENRY: (voice-over): With his health care push on the rocks, the president went back into campaign mode -- peeling off the jacket at Democratic Party headquarters to fire up his liberal base with talk of previous comebacks. BARACK OBAMA, PRESIDENT OF THE UNITED STATES: Last year just about this time, you'll recall that the Republicans had just nominated their vice presidential candidate and everybody was -- you know, the media was obsessed with it. And cable was 24 hours a day and Obama's lost his mojo and...

(LAUGHTER)

OBAMA: Do you remember all that?

(LAUGHTER)

OBAMA: There's something about August going into September where everybody in Washington gets all wee weed up.

HENRY: Earlier, he took the fight to conservative talk radio, pushing back on what he calls disinformation...

OBAMA: Then we can focus on the areas of legitimate debate.

HENRY: -- and signaling to host Michael Smerconish he may be forced to reluctantly pass a bill with only democratic votes.

OBAMA: I would love to have more Republicans engaged and involved in this process. I think early on a decision was made by the Republican leadership that said, look, let's not give them a victory and maybe we can have a replay of 1993-94, when Clinton came in. He failed on health care and then we won in the midterm elections and we got the majority.

HENRY: But a bigger challenge for the president is keeping peace in his own party, as he was forced to reassure liberals he has not abandoned the public option.

OBAMA: This is sort of like the belt and suspenders concept to keep up your pants, you know. The insurance reforms are the belt. The public option can be the suspenders.

(END VIDEOTAPE)

HENRY: But the president is walking a tightrope. He's still trying to show flexibility -- that he could eventually drop the public option if he needs to, to get a deal. That's to impress conservative Democrats who don't like the public option.

Meanwhile, he's got labor unions saying they're going to try to defeat Democrats who don't support the public option. I asked Robert Gibbs about that today and he said, look, the White House doesn't want to in the middle of the back and forth.

The bottom line is there could be a civil war brewing here within the party -- Wolf.

BLITZER: We'll watch it with you.

Thanks very much, Ed. Ed is over at the White House.

Voters in Afghanistan, meanwhile, defied a brutal anti-election campaign by the Taliban. They cast their ballots for president of Afghanistan today. It's too soon to tell how many braved Taliban threats and how many stayed home. But President Obama is casting it as an important step forward.

(BEGIN VIDEO CLIP)

OBAMA: We are continuing to ramp up the pressure in Afghanistan. And, you know, we had what appears to be a successful election in Afghanistan, despite the Taliban's efforts to disrupt it. You've got General McChrystal now over there and more troops who are putting pressure on the eastern and southern portions of Afghanistan.

(END VIDEO CLIP)

BLITZER: For more on this historic day in Afghanistan, let's go to ITV's John Ray in Kabul.

(BEGIN VIDEOTAPE)

JOHN RAY, ITV CORRESPONDENT (voice-over): In the end, it was a day for democracy -- a day when millions of Afghans defied the Taliban and amid tight security, headed to the polls -- a day that will decide the fate of a president.

UNIDENTIFIED MALE: Foaud (ph). No violence.

RAY: There was violence, but not on the scale that had been threatened. In Helmand Province, a rocket attack shook Lashkar Gar, where British forces are based.

Yet the Taliban has failed to halt this election. By midmorning in Kabul, the polling stations were doing brisk business. They dipped their fingers in ink and made their choice.

But how many have voted is still unclear. We returned mid- afternoon to find the place all too quiet.

(on camera): The polling booths are now almost deserted. The election officials wait patiently. The one thing in short supply here are voters. It is hardly a ringing endorsement for democracy.

UNIDENTIFIED MALE: So people, if they're a bit upset, they're enjoying their holiday. It's not -- it, for instance, it doesn't mean that we are scared or we are afraid.

RAY: We found complaints that the indelible ink meant to stop fraud soon washed off.

UNIDENTIFIED MALE: President (INAUDIBLE).

RAY: And election monitors admit there are areas they don't go. UNIDENTIFIED MALE: We can only do the job as far as we are able to access polling stations, of course. I mean we don't want to commit suicide or hang ourselves by going into some areas which are controlled by Taliban.

RAY: Counting is now underway, but not before polling was extended an extra hour. A big turnout will lend the result credibility. Tonight, the authorities here have already judged the election a success. The truth is, it's too important to be seen to fail.

John Ray, ITV News, Kabul.

(END VIDEOTAPE)

BLITZER: We aren't going to know the results for several days. They use paper ballots there. They count them the old-fashioned way.

Let's go to Jack Cafferty right now.

He's got "The Cafferty File."

It could take a while to find out if Hamid Karzai is re-elected.

JACK CAFFERTY, CNN ANCHOR: That didn't stop them in Iran, did it?

They -- they had that thing figured out...

BLITZER: Yes.

CAFFERTY: ...and handed it to Ahmadinejad by the time the polls were closed. I mean it was...

BLITZER: Right. Twenty -- 20 minutes later they knew.

CAFFERTY: It was bizarre.

BLITZER: Yes.

CAFFERTY: Forty million ballots cast and they had it all figured out in 20 minutes.

As the debate over health care rages on, the American people are increasingly souring on President Obama and the Democrats. A new poll shows the president's approval rating at 51 percent now -- the lowest of his presidency -- and down from 61 percent two months ago.

The Pew Poll shows the Democratic Party now has a favorable rating of 49 percent -- also down, from 59 percent in April, 62 percent in January.

When it comes to the Republican Party, nothing has changed -- public opinion remaining steady all year at about 40 percent.

Meanwhile, it looks like the American people aren't buying into calls for bipartisanship. The polls show 63 percent of those surveyed say the president and the Republicans are not working together on important issues.

Well, what's wrong with the rest of you?

And that's up from 50 percent who felt that way in June. And although more people blame the Republicans than President Obama for the lack of cooperation, the poll does show a growing number of people now faulting the president. Seventeen percent of Americans say Mr. Obama is to blame for the lack of cooperation, up from seven percent who felt that way in February.

Meanwhile, a separate Gallup Poll shows the Democratic-led Congress approval rating at 31 percent -- the lowest reading since February.

With health care eclipsing everything else in Washington this hot summer day, it seems as though the president and the Democrats are losing favor with the American people. It will be interesting to see what happens to these numbers if the Democrats decide to go it alone on health care, like we've been hearing they might.

Here's the question -- why are Democrats and President Obama's approval ratings falling?

Go to CNN.com/caffertyfile and post a comment on my blog.

The bloom is coming off the rose, I think.

BLITZER: Yes. We'll see what happens after his vacation. He's going on vacation next week, so we'll see if he rests us...

CAFFERTY: I'll bet...

BLITZER: ...recharges those batteries and comes back for a fight.

CAFFERTY: I bet he cannot wait.

BLITZER: I don't blame him.

All right, Jack. Thank you.

Old wounds of a terrorist attack reopened...

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: When you think of 270 people died and the sorrow we have gone through and the horror we have gone through and now one man decides to release him, OK? One man makes this decision.

(END VIDEO CLIP)

BLITZER: The man convicted of the PanAm Flight 103 bombing is now free and relatives of the victims, as you just saw, are outraged. He's getting a hero's welcome in Libya right now. We'll bring you the heartbreaking reaction, though, from a couple whose son was killed in the 1988 attack.

The U.S. West Coast has always been vulnerable to earthquakes. You're about find out why some scientists believe Seattle -- yes, Seattle -- could be the next place to get hit by the big one.

And questions clouding a world champion runner's victory -- the sports ruling body wants to know if she is really a he.

(COMMERCIAL BREAK)

BLITZER: Scotland's justice secretary has freed the Libyan agent convicted of murdering 270 people in the bombing of PanAm Flight 103. The airliner blew over -- blew up over Lockerbie, Scotland back in 1988. Many of the victims were Americans -- 289. Excuse me, 189, to be specific.

Terminally ill with cancer, Abdul Ali al-Megrahi was sent back to Libya today, still insisting on his innocence. Flag-waving Libyans rushed to the airport to welcome him home in celebration.

But his release has frustrated so many relatives of the victims and the Obama administration. President Obama says al-Megrahi should be placed under house arrest in Libya. And the State Department says he should be treated as criminal, not a hero.

(BEGIN VIDEO CLIP)

P.J. CROWLEY, STATE DEPARTMENT SPOKESMAN: Clearly, what happens when he returns to -- to Libya will have an influence on the future direction of our relationship. We've given a very direct message to Libya.

(END VIDEO CLIP)

BLITZER: CNN's Richard Roth was with the parents of one of the Lockerbie victims when the move this morning was announced -- Richard, they must have been devastated.

RICHARD ROTH, CNN SENIOR UNITED NATIONS CORRESPONDENT: All of the families, it seems, that we've talked to inside the United States. You know, Wolf, on that December day in '88, I was at Kennedy Airport when I watched grief-stricken friends and family of those on board that PanAm jet collapse to the ground in the terminal in New York.

Today, I invited one couple who lost a son on that PanAm jet to watch the big announcement in Scotland with me.

(BEGIN VIDEOTAPE)

KENNY MACASKILL, SCOTTISH JUSTICE SECRETARY: It is my decision that Mr. Abdul Baset Ali Mohmed al-Megrahi...

ROTH (voice-over): Jack and Kathleen Flynn couldn't believe what they were watching -- frustration and disgust on their faces as Scotland announced the release of the terrorist who killed their son, 21-year-old J.P. MACASKILL: Now terminally ill with prostate cancer, will be released on compassionate grounds and a return -- allowed to return to Libya to die.

JACK FLYNN, PARENT OF BOMBING VICTIM: I think it's totally, totally wrong, no matter if he only has three months to live or even a month to live, OK. He should not be released because he killed these people deliberately.

KATHLEEN FLYNN, PARENT BOMBING VICTIM: To take a man who has done this heinous crime and let him go back home to his country, to a hero's welcome, and whether he has two weeks, three months or 20 years to live is irrelevant.

ROTH: The Flynns were part of a group of American families that spoke by video conference with the Scottish minister, who was deciding whether to free al-Megrahi. They believe prior judicial and government rulings meant there was no way the prisoner was ever going to see the light of day.

K. FLYNN: Out of the blue comes this?

It makes no sense to me. It's very discouraging and it's -- it's very immoral, really, to let this happen.

ROTH: The Flynns went to the trial in the Netherlands and listened to the evidence. They firmly believe al-Megrahi is a mass murderer. Hours after watching the justice minister speak, al- Megrahi's plane headed into the same Scottish skies that PanAm Flight 103 was blown out of on December 21, 1988.

J. FLYNN: I think it's absolutely horrible. And to think of 270 people died and the sorrow we have gone through and the horror we have gone through. And now one man decides to release him, OK. One man makes the decision, OK. He overrules the judges who said he was guilty and should serve his time in prison, OK. This man should not have that kind of an authority. He should not. It's horrible.

(END VIDEOTAPE)

ROTH: The Flynns' son was one of several Syracuse University students on board the PanAm jet. The Flynns say they'll be at the United Nations when Libyan leader Gadhafi makes a rare appearance there next month -- Wolf.

BLITZER: Yes, we'll see what happens then.

All right. Thanks very much, Richard, for that report.

In an exclusive interview, I asked Scotland's justice secretary, Kenny MacAskill, who made the decision to free this terrorist, about his controversial decision to free him and he defends it all the way.

Listen to this.

(BEGIN VIDEO CLIP) MACASKILL: I released a sick man. The medical evidence given to me in a report dated 10th August by the Scottish Prison Service says that he's terminally ill. That is a sentence that I cannot impose in Scotland. No court could. We do not have the death penalty.

It's final, terminal and irrevocable. That sentence that he now faces cannot be revoked by any court or overruled by any jurisdiction. I have decided him to allow him to go home to die. I am showing his family some compassion.

I accept that it was a compassion not shown to families in the United States or in Scotland. But we have values. We will not debase them and we will seek to live up to those values of humanity that we pride ourselves on.

He was brought to justice after tremendous (INAUDIBLE) not simply by Scottish police and prosecution authorities, but by the United States. Equally, as I say, in Scotland, justice is temped with compassion. And that, as I say, is why he's been allowed to go home to die.

(END VIDEO CLIP)

BLITZER: All right. We're going to have the full interview with the Scottish justice secretary, Kenny MacAskill -- I think you're going to want to see it -- coming up later here in THE SITUATION ROOM. I ask him the questions you want him to try to answer. That's coming up right at the top of the hour. Stand by for that.

Iraqi forces have been taking over the security job in their country, but violence exploded all over again a day after hundreds of people died in half a dozen bombings.

What does the changing situation mean for U.S. troops still on ground?

Let's go to Pentagon correspondent, Chris Lawrence.

He's working the story for us -- Chris?

CHRIS LAWRENCE, CNN PENTAGON CORRESPONDENT: Well, Wolf, U.S. troops could be on the move. And just today, the Iraqi prime minister ordered more checkpoints, random searches and tougher vehicle searches -- all to improve security there.

(BEGIN VIDEOTAPE)

LAWRENCE: (voice-over): The families of Baghdad's bombing victims came to collect their remains Thursday after the deadliest day of coordinated attacks all year. Now, Iraqis are blaming their own.

UNIDENTIFIED MALE (through translator): We warned the security forces not to be lax, but those troops didn't carry out their duties.

LAWRENCE: The American commander in charge of training those Iraqi forces admitted... LT. GEN. FRANK HELMICK, U.S. ARMY: Clearly, there was a lapse of security.

LAWRENCE: The bombs killed nearly 100 people and came less than two months after U.S. troops left Iraq's cities. The Americans are only minutes away, but must wait until Iraqis ask for help, which may not come until well after.

HELMICK: They did request some intelligence surveillance and reconnaissance. In fact, we provided that. They've also requested some medical assistance, which we provided, as well.

LAWRENCE: Some blame Prime Minister Nuri Al-Maliki for pushing the Americans out too soon.

WESLEY GRAY, FORMER ADVISER TO IRAQI ARMY: He's telling the Iraqi people, hey, I'm the guy that freed you from the bonds of American occupation.

LAWRENCE: Wesley Gray is a former Marine officer who spent more than 200 days living with and mentoring Iraqi forces. He says they can do basic patrols and combat missions, but could fracture if religious tensions rise. Gray says Al-Maliki's strategy gives the opposition good reason to make his security forces look ineffective.

GRAY: The disenfranchised Sunni groups have huge incentives to -- to force him to have to go crawling back to the Americans, because then they can say, hey, look, this guy is weak. He couldn't do it.

(END VIDEOTAPE)

LAWRENCE: Well, the U.S. commander has proposed that American troops do get more directly involved, not in Baghdad, but up north. The tension between Arabs and Kurds is rising there and General Ray Odierno feels that putting American troops on patrol with them will help those two groups earn and develop some trust in each other -- Wolf.

BLITZER: We certainly hope General Odierno is right. He's a very smart guy, a tough guy. Let's hope he's got it right this time.

LAWRENCE: Yes.

BLITZER: Thanks very much for that, Chris.

Appreciate it.

A Republican senator who acknowledged an affair says his indiscretion wasn't as bad as former President Bill Clinton's. Senator John Ensign says at least he didn't lie under oath.

And one of Michael Jackson's older brothers is planning a tribute to the late superstar. We're going to tell you about the plans.

Stay with us.

You're in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: Poppy Harlow is monitoring some other important stories incoming into THE SITUATION ROOM right now -- Poppy, what's going on?

POPPY HARLOW, CNN CORRESPONDENT: Well, Wolf, we're keeping an eye on Hurricane Bill. The National Hurricane Center's latest advisory, which just came out a few minutes ago, says Bill is still a powerful and dangerous category three storm. Bill is moving closer to Bermuda, which has issued a tropical storm watch. Forecasters say it's unlikely Bill will make landfall here in the US, although there is a possibility the storm could brush the Massachusetts island of Cape Cod.

Also making headlines, Iran reportedly lifting a ban of the United Nations inspections of its nuclear sites. Unnamed diplomats tell the Associated Press that officials from the International Atomic Energy Agency visited one of Iran's nuclear reactors last week. The site that was inspected produces materials for nuclear fuel that can be enriched to provide material for weapons.

And in Israel making headlines, one of the country's most famous television stars has committed suicide. Entertainer Dudu Topaz was found hanging from the shower of his jail cell. Topaz had been in prison for the past several months while on trial for allegedly arranging an attack on top Israeli media executives who he blamed for keeping him off the air. Topaz's career had been slowing in recent years, partly because of the rise of reality shows on prime time television.

And finally, one of Michael Jackson's older brothers, Tito, is planning a tribute to the late superstar during a British tour later this year. Tito Jackson will be touring Britain with singer Gladys Knight in the fall. Concert promoters say he will perform songs by Michael and The Jackson 5. Michael Jackson died on June 25th, just weeks before he was to begin a series of comeback concerts in London -- Wolf.

BLITZER: Thanks very much for that, Poppy.

Stand by.

Cash for Clunkers is sputtering to a halt. With all that extra money, why is the popular program itself now heading for the scrap heap?

What's going on?

And mothers of American hikers seized by Iran -- they say their kids are not spies -- what they're trying to get them free.

Plus, a young runner pulls off a stunning upset in a women's world championship race. But now, there's an investigation into whether she might be a he.

(COMMERCIAL BREAK)

BLITZER: You're in THE SITUATION ROOM.

Happening now, the man convicted of murdering 270 people in the 1988 bombing of PanAm Flight 103 has now returned to Libya to a hero's welcome. We're going to bring you my interview -- an exclusive interview -- with the Scottish official who made that controversial decision to set him free. Stand by.

Why did the CIA hire a controversial private security contractor to help kill top Al Qaeda leaders?

CNN's Barbara Starr is digging into that story.

And new information from the Commerce Department says the number of poor and uninsured Americans is increasing.

How does this factor into the Obama administration's push for health care reform?

I'm Wolf Blitzer.

You're in THE SITUATION ROOM.

The popular Cash for Clunkers program, which Congress rushed to refuel with another $2 billion, is sputtering once again.

Let's go to CNN's Poppy Harlow once again.

She's got the story for us.

It looks like the program is about to end -- is that right, Poppy?

HARLOW: That's exactly right, Wolf. The government announcing today it will end that Cash for Clunkers program come Monday evening.

That news comes, Wolf, after hundreds of auto dealers right here in the New York area quit the program, saying it's taking too long for them to get reimbursed by the government. And they said they just can't afford to wait any longer for that voucher money.

(BEGIN VIDEOTAPE)

HARLOW: (voice-over): David Pisciotta, along with most car dealership managers in the country, thought the Cash for Clunkers federal program was a Godsend in a year when his dealership sales were down 30 percent.

DAVID PISCIOTTA, GENERAL SALES MANAGER, BAY RIDGE TOYOTA: And it's worked. It has been a shot in the arm. Business has increased significantly.

HARLOW: But 105 clunkers later, his dealership has still not seen a penny back from the money he says they've fronted the government. PISCIOTTA: As of right now, August 20th, we have not been fronted yet on one deal, about a half a million dollars. And it's scary.

HARLOW: David's Bay Ridge Toyota dealership saw its sales numbers come back to normal thanks to the cash for clunkers program and is trusting the program will pay its debt. But hundreds of other dealership, including half of the 425 members of the greater New York Automobile Association, pulled out before the program was officially closed fearing they would not be reimbursed. Transportation Secretary Ray Lahood maintains that although there have been delays processing the paperwork, all car dealers will get their cash back.

RAY LAHOOD, TRANSPORTATION SECRETARY: They're going to get their money. We have the money to provide to them.

(END VIDEOTAPE)

HARLOW: All right. And the department of transportation says there is enough money to continue accepting submissions until Monday's deadline and also says they're continuing to expand the number of people processing dealer applications so the dealerships will be reimbursed as quickly as possible.

BLITZER: Can people still get cash for a clunker, a deal this weekend?

HARLOW: They certainly can, and I'm sure the dealerships will be fully staffed this weekend given this Monday deadline announcement. The transportation secretary saying as long as all that paperwork, Wolf, is in by Monday at 8:00 p.m. eastern time, they will reimburse those dealers. It will be an interesting story to watch -- Wolf?

BLITZER: Thanks very much, Poppy.

So, why did the government decide to end the cash for clunker program by Monday night? Let's talk about it with our CNN contributors joining us, Democratic strategist Donna Brazile and the Republican strategist Alex Castellanos. Donna, what do you think? Was this a good idea, $3 billion to get the car sales moving and get greener engines out there?

DONNA BRAZILE, DEMOCRATIC STRATEGIST: This program has been a huge success. 700,000 cars have been turned in, dirty, polluting cars for clean, efficient cars. Wolf, within the first four days of this program, 250,000 cars were sold. I mean, this program is helping to revive auto does he recalls, helping consumers and it's helping our environment. It's a net plus for everyone.

BLITZER: So, the $3 billion was a good investment, Alex?

ALEX CASTELLANOS, REPUBLICAN STRATEGIST: These people in Washington are so smart. They've discovered if they take billions of dollars and give it to people, people will actually take it. That's called a huge success in Washington. You know, only in Washington will they do something like that. No, not a good idea. Why? A lot of the old cars taken off the road actually serviceable cars that had a lot of life left in them. Two, guess what people are trading in those cars? They're trading in fords for Toyotas. Toyotas are the number- one beneficiary of the cash for clunkers. Congratulations, Japan, the American taxpayers are here to help you.

BLITZER: Donna what do you think?

BRAZILE: First of all, I think Alex is not looking at the overall impact it will have on our economy where the GDP will rise in the next couple months because people are spending money. That's what we need consumers to do, spend money, buy cars. Those foreign cars, I disagree, they're made in the United States and that's jobs. We're saving 1,200 jobs in this country.

BLITZER: She's right. A lot of the Japanese cars are assembled in Kentucky and Tennessee.

CASTELLANOS: $3 billion for very few jobs. And on top of that, this is not a stimulus. This is cost shifting. Americans are taking -- it's our own money we're giving to ourselves. Two, the part people have to contribute to pay themselves is cost -- they could have spent this money on clothes and other things.

BLITZER: The point that Donna make, hundreds of thousands of cars that are polluting the air are going to be dumped, destroyed, and newer cars, more efficient cars, are going to be on the road.

CASTELLANOS: You know, it's a wonderful thing to clean up the environment but at a cost of $3 billion for a minuscule impact on the environment, taking good, serviceable car off the road, people who can afford to buy a new car, great. But a lot of people out there got these cars as used cars. You're hurting the poor with a program like this.

BRAZILE: We're helping consumers, helping auto dealers, revitalizing an industry that will keep jobs in this country, something we should all celebrate.

CASTELLANOS: A giveaway, not a program.

BLITZER: Let's talk about Senator John Ensign of Nevada. He has admitted having an affair, and he says that he didn't do anything legally, emphasis on the word "legally" wrong. President Clinton, he said, stood right before the American people and he lied to the American people. You remember that famous day he lied to the American people, plus the fact I thought he committed perjury. Is this a good explanation, Senator Ensign?

BRAZILE: We don't have enough time.

CASTELLANOS: When you're in a hole, stop digging. I've been in some focus groups in different parts of the country lately. When you ask people what do you expect from your government, from your political leaders, it's funny. They don't say, oh, fix health care or give me a tax cut. They say tell those guys up there to straighten up, act ethically, be responsible, because they see government right now as irresponsible with their money and irresponsible with their own lives. And I think these things just add to that perception.

BRAZILE: I have this quote now on my wall from Jenny because I thought --

BLITZER: The wife of the governor of Mark Sanford.

BRAZILE: Politicians have become disconnected from the way everyone else lives their lives in this country and it's easy for them to call out for help and if ten people will help them it's an ego boost and easy to drink your own Kool-Aid. John Ensign has drank his own Kool-Aid.

BLITZER: Mark McKinnon, a great Republican strategist, worked for President Bush, helped get him elected president of the United States, he's got Ten Commandments for politicians he put out there on the Daily Beast. Let me read them to you because some of them are pretty cute, don't lie, don't cheat, don't have affairs with aides, don't hire relatives of aides, don't claim immunity because your activity is not prosecutable, don't use government aircraft for liaisons, don't hike the Appalachian Trial, don't go looking for that sparking thing, don't make foreign bed chambers a rational for trips and do resign when found guilty of any of the above.

BRAZILE: And don't hide money in freezers. That one should be added to the list.

CASTELLANOS: Just pay attention to the old Ten Commandments you won't need the ten new ones. I disagree with Mark on one thing. It's OK to hike the Appalachian Trail if you actually do it.

BLITZER: Well spoken first son of North Carolina. Partly through North Carolina.

CASTELLANOS: Beautiful country.

BLITZER: Thanks very much, guys, for coming in.

The families of three U.S. hikers that are being held in Iran are speaking out. We'll tell you about their campaign to win their loved ones' release.

And the man convicted of the Pan Am flight 103 bombing has been released from prison, getting a hero's welcome in Libya right now. You'll hear what Scotland's justice minister told me in an exclusive interview about why he decided to let a mass murderer go free. This is an interview you will see at the top of the hour, the full interview coming up right here in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: Iran is keeping mum about three American hikers seized last month after straying across the boarder from Iraq. The U.S. government is getting nowhere, so the families are now speaking out. CNN's Brian Todd has been taking a closer look into the story. What are you learning? BRIAN TODD, CNN CORRESPONDENT: Getting more indications of how frustrated these families are getting. It's been 21 days since these three young Americans were detained at the Iranian border. Now from their families a change in strategy, going public on the web and on TV.

(BEGIN VIDEOTAPE)

SHANNON BAUER, BROTHER IS DETAINED IN IRAN: Every day when I wake up the first thing I think about, but nothing yet.

TODD (voice-over): On ABC, siblings press for the release of three American hikers three weeks after Iran detained them for crossing the border. Were they careless?

CHRIS RAPP, SISTER IS DETAINED IN IRAN: Typically they're very careful about where they are and what they're doing.

BAUER: There's not, like, a big sign saying you're about to go into Iran. There's nothing.

TODD: Their mothers appeared on NBC. They were asked where r they sure their kids weren't spying?

UNIDENTIFIED FEMALE: Absolutely.

UNIDENTIFIED FEMALE: Absolutely.

UNIDENTIFIED FEMALE: No question.

TODD: In 2007, Haleh Esfandiari, a scholar was held in Iran for several months. Give us some insight into what these three people are going through.

HALEL ESFANDIARI, AUTHOR, "MY PRISON, MY HOME": If they're moved in prison, very humiliating. It's very tough. If they are threatened with being, you know, kept there for a long time, put on trial.

TODD: Diplomatic efforts have been fruitless.

IAN KELLY, STATE DEPARTMENT SPOKESMAN: Switzerland has not been counselor granted access to three American hikers. Iran has also not provided information about their location and whether or not any charges have been filed against them.

TODD: It took high-profile visits to secure the recent release of two Americans held by North Korea and an American held in Myanmar. But the last American held by Iran, Roxana Savari, was released without an official's visit. For the hikers family, this advice.

ESFANDIARI: I would tell them, don't keep silent at all. Not even for a minute. Get in touch with all the media not only in the United States but around the world. Use every possible means to get your loved one out.

(END VIDEOTAPE) TODD: Esfandiari says it was the tireless efforts of her family and friends including a letter from her boss to Iran's supreme leader, Ayatollah Ali Khamenei, that she believes helped secure her release -- Wolf?

BLITZER: The fact the United States and Iran don't have diplomatic relations, how does that play?

TODD: Makes it very complicated. All messages from the U.S. to the Iranian government has been have to be passed through the Swiss embassy there, which handles U.S. interests in Tehran. Esfandiari says the Swiss can't always be very forceful with the regime. She hopes that improves with a new Swiss ambassador.

BLITZER: Thanks, Brian. We'll watch this together with you. An important programming note to our viewers. The mothers of the three missing American hikers detained in Iran will be on "ac 360" later tonight, 10:00 p.m. eastern.

Why would the Russian military mobilize all its resources to hunt down what seemed to be a very ordinary cargo ship after it was hijacked in the Atlantic? Russian authorities have been questioning crew members and alleged hijackers. Our senior international correspondent Matthew Chance picks up the story from Moscow.

(BEGIN VIDEOTAPE)

MATTHEW CHANCE, CNN SENIOR INTERNATIONAL CORRESPONDENT: The crew are rescued, the pirates arrested. Weeks of absurdity have been brought to an end. But the mystery surrounding this cargo ship "The Arctic Sea" still anchored off the West African coast is far from solved. On Russian television, the suspected hijackers are shown being cuffed and carted off to a high-secure prison, all eight flown to Moscow as well as members of the ship's Russian crew. It's they who are now the main source of information as to what happened, why the crew told the Swedish coast guard, for instance, that the hijackers had gone.

VLADIMIR KASHIN, ARCTIC SEA ELECTRICAL ENGINEER (through translator): The radio dispatcher was able to replay a text message with an SOS that the ship was hijacker. The guards called back asking if we were really hijacked. The captain had a gun to his head. All he could say is we were joking.

CHANCE: But many other questions surrounding a bizarre voyage on the arctic sea carrying less than $2 million worth of timber was attacked in waters and after a massive effort was finally intercepted 300 miles off Cape Verde. At the center of the mystery is the issue of why a ship carrying such a mundane cargo would have been hijacked and while Russia devote aircraft, submarines, even, spy satellites to locate it, it's all fueling speculation there was something much more valuable on board.

Drugs, illegal weapons, even nuclear material have been mentioned as possible motives. Russian authorities deny there's a cover-up, but in the continued absence of hard facts, conspiracies are, as always, filling the void.

Matthew Chance, CNN, Moscow.

(END VIDEOTAPE)

BLITZER: There's a cloud over a world champion runner's recent victory. There are questions about whether the young woman who blew her competition away is really a man. Stand by.

And where will the next big earthquake of the United States hit? Why scientists are saying Seattle. Seattle, Washington, could be a prime target.

(COMMERCIAL BREAK)

BLITZER: She blew away her opponents in impressive fashion in a recent international competition. But now a South African runner's victory is under a cloud because of some confusion of her gender. Let's go to Larry Smith of CNN Sports. He is following this story for us. Explain to our viewers what's going on.

LARRY SMITH, CNN SPORTS CORRESPONDENT: I tell you, Wolf, this is really a wild story when you think about it. In a month's time, Caster Semenya has gone from an unknown athlete from rural South Africa to the biggest sports controversy on the planet.

(BEGIN VIDEOTAPE)

SMITH: After Caster Semenya posted a world-best time at the African junior championships three weeks ago, the IAAF asked the South African athletics information to administer a gender test. Then on Wednesday, the 18-year-old, unheard of until the this summer, pulled off a stunning win in the women's 800 meters at the world championships, further fueling speculation. The IAAF confirmed there are two investigations under way. One in South Africa, and one in Berlin where the world championships are taking place.

PIERRE WEISS, IAAF GENERAL SECRETARY: I am not a doctor. All the doctors who were contacted, who were consulted, told us very clearly this time -- this kind of investigation is days and even weeks before we can come to a conclusion.

SMITH: Semenya is reportedly unaffected by the gender question. Family members say she was teased as a child about her appearance. Her father is outraged. Jacob Semenya told a newspaper, "She is my little girl. I raised her and I have never doubted her gender. She is a woman and I can repeat that a million times." Caster Semenya isn't the first female athlete to have her gender questioned. An Indian runner had her silver medal in the 2006 Asian games stripped after failing a gender test. Her genetic makeup reportedly showed a male chromosome. A sprinter from Poland won two medals in the 1964 Olympics, but three years later she failed a gender test and was banned from professional sports. An American won gold at the 1932 Olympics, but a post-mar tem exam after her death in 1980 revealed she had male sex organs as well as male and female chromosomes. The African National Congress are rushing to Semenya's defense and she seems to have the support of her countrymen and women as well.

(END VIDEOTAPE)

SMITH: These tests will take weeks to complete. We won't know the results for quite awhile. Until the investigation is complete, Wolf, she will continue to compete and the questions will continue to swirl.

BLITZER: No doubt about that, Larry. Thanks very much. Good report.

Go back to Jack Cafferty right now. He's got "The Cafferty File" -- Jack?

CAFFERTY: Story creeps me out. It's weird. Do you think she's a man or a woman?

BLITZER: I don't -- we'll see. We'll see what the tests show.

CAFFERTY: All right. The question: Why are the Democrats and President Obama's approval ratings falling?

Scott in New York: "The answer's simple. Obama promised the moon and the stars. There's an old saying regarding managing expectations, underpromise and overdeliver. Obama has seriously overpromised things that no one can deliver and his ratings will continue to fall."

Shaun in North Carolina: "Why? Because many independence voted for President Obama, and they're independence for a reason. They can see through the unilateralism in the Congress."

Joan, Eden Prairie, Minnesota: "Not falling, just realigning with the reality that high-minded presidents come and go. But the Washington beltway is forever."

Rick says: "Very simple. At least the American public is seeing the truth. The Democrats are a tax and spend machine bent on socialism. All you have to do is read the textbook definition of socialism. You can see it for yourself. Bottom line, they used the liberal media and a blame everything on George Bush strategy to get elected. They have a socialist agenda that's definitely not good for America."

Marie writes from Georgia: "The president's losing in the polls because he's working on difficult issues and trying to solve them. He's tried to include Republicans, but they're more interested in his failures so that they can gain politically."

Ralph in Chicago writes: "Because Jesus Christ's approval ratings would fall. You've got two wars, 10% without a job, no overtime, no health care, and city and state taxes all going up."

And Michael writes from New York: "They're not. Everybody's on vacation, and the pollsters just can't get to the Caribbean islands right now to get the real numbers."

If you didn't see your e-mail here, go to my blog at CNN.com/Caffertyfile and look for yours there among hundreds of others -- Wolf?

BLITZER: Jack, thank you. An ailing terrorist convicted of killing 270 people is now freed from prison. Are you comfortable knowing that from now on the name Kenny Macaskill, Scottish justice secretary, will be linked to the release of this mass murderer? My exclusive interview with a man who sent the Lockerbie bomber back to a hero's welcome in Libya. That's coming up in a few moments. You're going to want to see this.

Is a former secretary of homeland security now suggesting that those terror alerts during the Bush administration were politically motivated?

(COMMERCIAL BREAK)

BLITZER: Been several years since the United States experienced a major earthquake, but scientists are now bracing for the next big one and they're saying the city of Seattle could be ground zero. CNN's Dan Simon has details -- Dan?

DAN SIMON, CNN CORRESPONDENT: Wolf, when people think of Seattle, they probably think of the space needle or those dreary days. Certainly not earthquakes. That could be changing.

(BEGIN VIDEOTAPE)

SIMON (voice-over): At Seattle's famous pikes place fish market, workers approach earthquakes the same way as their jobs -- with humor.

CHRIS BELL, SEATTLE RESIDENT: I guess we're due for it. I mean, myself living downtown, I'm in a high-rise. If it goes, at least I'm going to go quick.

SIMON: But tremblers in Seattle are no joke. In 2001, the city got hit by a 6.8 magnitude quake. Significant, but scientists at the University of Washington fear the next one will be worse.

PROF. JOHN VIDALE, SEISMOLOGIST: We know it's just a matter of time. The question's really how much will the city shake when it comes?

SIMON: Professor John Vidale is the state seismologist. He says research over the last few years shows that earthquake fault zones in the pacific northwest may lie closer to the city than previously thought.

VIDALE: The new evidence suggests that the edge of the breakage closest to us is now halfway in from the coastline instead of near the coastline.

SIMON: Closer to Seattle?

VIDALE: Closer to Seattle. SIMON: What that means is a quake impact would be felt much more. How much? Researchers say it can produce a magnitude of 9.0 or greater. That's equal to that 2004 quake off the coast of Indonesia which spawned the killer tsunami. Scientists say that does not mean a 9.0 would necessarily cause widespread devastation here, but vital structures, including some traffic arteries, would likely collapse. People would most certainly die. Right above me is the Alaskan wave viaduct. It carries more than 100,000 cars a day. One expert told us he'd be more surprised if it stayed up following a big earthquake than if it came down. The 1989 earthquake in the San Francisco bay area destroyed a similarly designed viaduct. 42 people died. And county officials say at least 200,000 homes across Seattle and its suburbs are considered vulnerable. Some have heeded the warning. Peter Lynch is having his two-story house retrofitted to withstand a powerful shake.

PETER LYNCH, HOMEOWNER: I'd much rather be prepared than wait for the big one to come and have to pick up the pieces.

SIMON: But many don't have or aren't willing to shell out the $5,000 to have the work done.

(END VIDEOTAPE)

SIMON: Residents of San Francisco and Los Angeles already live in constant fear that the big one could strike at any time. Now it seems you can add another city to the list --Wolf?

BLITZER: Dan Simon, thanks very much.

Happening now, breaking news. What so many people around the world see as an outrageous decision to let a convicted terrorist go free? My exclusive interview with the Scottish official who sent the Pan Am bomber home to die. And reaction from families of the victims. They are angry, they're disgusted, and they are still grieving, now more so than ever. Stand by for a powerful hour.

And some gut-wrenching questions. Are you comfortable knowing that from now on the name Kenny Macaskill, Scottish justice secretary, will be linked to the release of this mass murderer?

I'm Wolf Blitzer in CNN's command center for breaking news, politics, and extraordinary reports from around the world. You're in THE SITUATION ROOM.