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Gulf Well Cap Watched in 24-Hour Intervals; Senate to Vote on Jobless Benefits

Aired July 19, 2010 - 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, another 24 hours of testing on the new well cap begins amid serious questions about leaking or seeping oil. We've just received new information from the incident commander, Thad Allen. We'll digest it all with one of the president's top energy advisers.

Also, "Top Secret America" hidden from the public and too big to be efficient or manageable? That's a question. It's posed in an in- depth Washington Post investigation that exposes some huge problems within the U.S. intelligence community almost a decade after 9/11.

And is the tea party movement being torn apart by allegations of racism? One wing of the group expels another and tea party-backed candidates are left holding the bag.

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

Right now officials in the Gulf say they don't see any major red flags with the new well cap that might force them to unleash a big gusher of oil. Once again, they're moving ahead with another full day of tests, another 24 hours. They are keeping a close watch on pressure levels, all important pressure levels, and any existing or potential oil leaks. CNN's David Mattingly is looking at all of this for us. He is in New Orleans on the scene.

You just heard from Thad Allen, the incident commander, update our viewers on what we know, David, right now.

DAVID MATTINGLY, CNN CORRESPONDENT: Wolf, Thad Allen says that they're looking at anomalies that they're encountering down there, but so far none of them indicating a problem that tells them they have to stop these tests and reopen that well. But these anomalies, as he discussed them, were happening as methane coming up from the ground and into the water out there.

In particular, one area of seepage about three nautical miles, he said, that's about two miles away from the well itself. They're also looking at a leak of oil that is actually coming out of the well equipment that they have there, but he says it's small, it doesn't seem to be causing a problem. But here he lays it all out for us in this comment right here.

(BEGIN VIDEO CLIP) ADM. THAD ALLEN, COAST GUARD (RET.), GULF OIL SPILL INCIDENT COMMANDER: There have been three general areas of anomalies that have been detected since the 17th of July. The first one was a seepage about three nautical miles from the well head itself. We do not believe that is associated with this particular well integrity test or the Macondo Well. However, we are continuing to look at baseline data associated with past activity that's in the area and will continue to monitor that moving forward.

(END VIDEO CLIP)

MATTINGLY: Monitoring, watching every single step as they take here, Wolf, so far so good. They are not seeing anything coming back to them that tells them that this well is not going to work -- Wolf.

BLITZER: As we go forward right now, they're briefing -- Thad Allen is briefing, representing the federal government, but BP officials are briefing as well, right?

MATTINGLY: BP is going to talk to us very shortly. We've been getting technical briefings every morning. They did not have one this morning, waiting for Thad Allen to come out and talk first. There was a little bit of back and forth, it looked like, between the two sides over the weekend. BP came out in the morning, gave a very confident report that the well is doing fine.

And then Thad Allen, a little bit later, was coming back, saying, we need all of these things, all of these assurances from BP regarding monitoring and timetables about what you're going to do if you encounter a problem before we move forward.

All of that was worked out. They are moving forward. And we're now in another 24-hour period, we hope, with no oil leaking into the Gulf of Mexico.

BLITZER: David Mattingly will be all over this story for us. Thank you.

The man overseeing BP's $20 billion damages fund says it should be easier to resolve claims now that the oil leak apparently has stopped, at least for now. Ken Feinberg said today it has been difficult to come up with an overall budget because officials haven't known how long the spill would last.

Four U.S. senators, meanwhile, are going to new lengths to investigate the possible connection between BP and the release of the Lockerbie bomber. They've requested a meeting this week with the British prime minister, David Cameron, who is coming to the United States for talks with the president.

Questions have been raised about whether a deal was cut to protect British oil and business interests in Libya. British, Scottish, and Libyan officials have denied there was such a deal. BP has denied it as well.

Just a few moments ago I spoke to the point person over at the White House on the president's involvement on what's going on. We spoke about the latest developments in the oil disaster as well.

(BEGIN VIDEOTAPE)

BLITZER: And joining us now from the White House, the president's energy adviser, Carol Browner.

Carol, thanks very much for coming in. A quick general question, because I keep hearing nuances that seem to be different between what BP is saying and what Thad Allen is saying, in principle right now, is the federal government, which is what you represent, and BP, are you both on the same page?

CAROL BROWNER, DIRECTOR, WHITE HOUSE OFFICE OF ENERGY AND CLIMATE CHANGE POLICY: We are. Obviously this is a difficult situation. A lot of people working very long hours for a very long period of time. But we've agreed that they can continue to shut-in the well in 24-hour increments so long as we get the monitoring and the surveillance information that we've been seeking so that our scientists who are working around the clock can review that information and make sure that everything is remaining as it should be. If things change, then we'll make a different decision and BP will be informed of that.

BLITZER: As of now, you have confidence in BP?

BROWNER: I'm confident that in 24-hour increments we can leave the well shut in. We need our scientists to review all of the monitoring information each 24-hour period and we'll make a determination.

BLITZER: What are those bubbles that are coming up near this well? Have you concluded what they are? Because they were causing some concern.

BROWNER: Well, the scientists are looking at that there are some bubbles at the base. There are some bubbles around the new blowout preventer, or the new cap. All of that is being looked at right now. I just got off the phone with our scientists. They feel like they're getting information so they can analyze it. And they're not worried at this point in time.

But should they become worried we will obviously move quickly to direct BP to take action. What we don't want, Wolf, and what is very important for people to understand, are uncontrolled leaks across the Gulf. That there would be some -- because of the downward pressure that you might have oil leaking out or you might have oil leaking out of the new cap.

Obviously if that's happening and it's at a dangerous level, we will need to take steps, and we will do so.

BLITZER: Methane gas, is that a problem right now? Is that leaking? And if it is, what does that mean?

BROWNER: Well, what the scientists tell us is there may be some methane gas leaking. Again, they don't think there is a problem but it is being monitored and it is being analyzed. BLITZER: And what happens if it is leaking?

BROWNER: Well, if it turns out that it's leaking at a rate that's a problem, then obviously containment is the alternative. You bring back in the vessels, the ships that can capture the oil. Now, obviously that will be a difficult decision because there will be the -- some leaking -- some uncontrolled leaking for a couple of days.

But clearly what we don't want are spills all over or something more catastrophic to happen. So the scientists are on top of it. They're monitoring it. Thad Allen is fully engaged. And we will be making appropriate decisions as we go forward.

BLITZER: Sure. From what I'm hearing you and Thad Allen and representatives of BP say, right now the hope is to keep that cap on, keep all of the oil from coming up, but if that doesn't work, to get a pipe to start containing the oil at the top with these ships that have been located there.

BROWNER: That's absolutely right. Obviously no one wants to see any oil leaking. If we can continue in the cap mode, we'll do so. I f not, we will go to the containment with the ships coming back into place.

BLITZER: The ultimate solution are those relief wells. Are they still on schedule for early to mid-August or can you move that up?

BROWNER: They're still on schedule for mid-August. The work is going on. Obviously it's very delicate, important work that's under way. But they are on schedule. That is the good news.

BLITZER: A lot of folks are really worried about the moratorium on deep-water drilling, which the Obama administration has imposed. It's now in the courts. What is your bottom line assessment right now? Can they go back to work on these deep-water drills, oil rigs any time soon?

BROWNER: Well, the Department of Interior did issue a new pause, a new moratorium. And it has really sort of three components to it. First, what are the safety steps that can be taken to ensure that you have all of the right safety features on these rigs on the blowout preventers?

Secondly, what are the containment strategies? What in the worst-case scenario would you do if there was another accident in terms of containing? Obviously we're learning a lot about how to do that right now.

And then finally are all of the -- is there adequate cleanup, what we call oil spill response capabilities? Clearly, we are stretching all of those response capabilities right now. As you know, we have 50,000 people in the region, over 7,000 vessels. This is a full-on attack on this oil.

But it's important to have those questions answered so that when we do move forward again, we do so in a way that protects our environment and protects the economy of the Gulf of Mexico.

BLITZER: Is there is a time frame, three months, six months, longer? How much longer do you need to go through these investigations before you make a final decision?

BROWNER: Well, Interior is looking at all of that. And I know everyone is eager to have an answer, but it's important to do so in a thoughtful manner. And I have all the confidence in the world that they will do that. Mr. Bromwich is there. He has a good track record for solving complicated problems.

BLITZER: Carol Browner, good luck. Thanks very much.

BROWNER: Thank you.

(END VIDEOTAPE)

BLITZER: President Obama says Republicans are playing politics with Americans' jobless benefits. On the eve of a key vote, are both sides though trying to score some election year politics?

And a watchdog is accusing the Obama administration of pressuring the auto industry without thinking about the jobs it would cost.

(COMMERCIAL BREAK)

BLITZER: Let's go to Jack Cafferty, he is here with "The Cafferty File" -- Jack.

JACK CAFFERTY, CNN CONTRIBUTOR: Stunning story in The Washington Post, Wolf. In the nine years since the September 11th terror attacks, the U.S. intelligence community has become so large it is now unmanageable, redundant, and inefficient, which is not unlike the rest of the federal government.

The Washington Post reports on a stunning two-year investigation of a "Top Secret America" that's hidden from the public and lacking in real oversight. Here are some examples. There are nearly 1,300 government organizations and 2,000 private companies working in 10,000 locations across the country.

There are 854,000 people who have top secret security clearances. There are 33 building complexes for top secret work that are under construction or have been built just in Washington, D.C., alone since 9/11, totaling 17 million square feet of space.

Analysts turn out 50,000 intelligence reports every year. You can bet a lot of them never get read. And at least 263 organizations have been created or reorganized as a response to 9/11. That, of course, means hiring lots and lots of people. But don't ask them where Osama bin Laden is, because nobody knows.

With such a sprawling bureaucracy, it's no wonder they couldn't put together the dots in recent attacks, including the shootings at Fort Hood, and the attempted Christmas Day bombing of an airplane in Detroit. The government is pushing back against The Washington Post report. The national intelligence director says, they provide oversight and they work constantly to reduce inefficiencies and redundancies. What would you expect him to say? A top Obama official adds that they are looking at inefficiencies, quote, "and remember, we have prevented attacks," unquote. Now, who does that sound like?

Here's the question. how effective can U.S. intelligence be with nearly 1,300 government organizations and 2,000 private companies working in 10,000 locations? Go to cnn.com/caffertyfile and wrap your little old brain around that -- Wolf.

BLITZER: We will do it. Next hour, by the way, Jack, we're going to speak to the co-author of that Washington Post article, Dana Priest. Got some good questions for her.

CAFFERTY: Tremendous piece of reporting. Tremendous piece of reporting.

BLITZER: Yes. That's what happens when you get two years to work on a series of articles, you come up with reporting like this.

CAFFERTY: That's the same kind of journalism you get on all of those Web sites, right?

BLITZER: No.

CAFFERTY: No.

BLITZER: This is serious journalism.

CAFFERTY: Yes.

BLITZER: All right. Thanks very much.

President Obama today angrily accused Republicans of holding unemployment benefits hostage to election year politics. The Senate is set to vote tomorrow on an extension of jobless benefits that has been delayed by GOP leaders several times. Mr. Obama claims they're under the misguided notion that a new relief bill would discourage people from actually looking for work. Republicans say they're concerned that the $33 billion price tag of the bill will only fatten the deficit.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: Right now these benefits, benefits that are often the person's sole source of income while they are looking for work, are in jeopardy. And I have to say, after years of championing policies that turned a record surplus into a massive deficit, the same people who didn't have any problems spending hundreds of billions of dollars on tax breaks for the wealthiest of Americans are now saying we shouldn't offer relief to middle class Americans like Jim or Leslie or Denise who really need help.

(END VIDEO CLIP)

BLITZER: All right. Let's bring in our senior political analyst David Gergen.

The Republicans say, you know what, they want to spend this money, $33 billion. They want to provide the extended unemployment benefits. But they want to cut $33 billion from elsewhere in the federal budget to pay for it so that our children and grandchildren won't have to pay through the deficit.

What's wrong with that theory? Can't they find $33 billion elsewhere to pay for it?

DAVID GERGEN, CNN SENIOR POLITICAL ANALYST: Sounds like, Wolf, they could find the $33 billion there in the intelligence budget, doesn't it, from what we just heard from Jack Cafferty.

You know, Wolf, if you like hypocrisy, you love this story. There is a lot of hypocrisy on both sides these days about spending. Both sides want to increase unemployment benefits. The Democrats are bragging that they've passed a pay-as-you go bill earlier in this session of Congress, which required that every time there is new spending that it be offset with other cuts or new tax increases.

And they have exempted unemployment insurance from that. There is hypocrisy in that. The Republicans have the better side of the argument. But thank goodness we are going to get the benefits extended. It is really important.

BLITZER: Yes, but the Democrats also say the Republicans have some hypocrisy -- are being hypocritical because they want the Bush tax cuts, which are supposed to lapse at the end of this year, to continue next year, but they don't want to cut a trillion dollars or so or $800 billion that those extending the Bush tax cuts would cost.

GERGEN: Well, I think that's why the Democrats have the better end of this argument about the tax cuts. And I think there is hypocrisy on the Republican side. It is well understood now, starting with the deficit commission, if we're going to get these budget deficits under control, most of it, a good majority, perhaps two- thirds is going to have to come from spending cuts. We do have excess spending.

But you're going to have to find some tax increases too before this is over in order to get this problem solved. So just to extend these Bush tax cuts, especially for the affluent, Wolf, you and I can afford to pay higher taxes, go back to the rates of the Clinton years. It would not hurt us. It would not hurt the economy. I think you and I would agree on that.

But to just sort of willy-nilly extend all of these tax cuts for everybody means we're not going to have the money to pay for these deficits. So both sides are engaged in a lot of politics, a lot of hypocrisy. I'm afraid that's Washington these days.

BLITZER: It's interesting, over the weekend Alan Greenspan, the former chairman of the Federal Reserve, told Judy Woodruff, you know what, all of these tax cuts that Bush passed in 2001, 2003, let them lapse, go back to the Clinton years' tax cuts because the deficit is exploding right now, the country simply can't afford it.

We'll continue this conversation, David, because there is lots to digest and discuss. Thank you.

The owner of that massive rig that exploded in the Gulf of Mexico now getting hammered by investigators. What is that revealing about the moments after the blast? Our Mary Snow standing by with details.

And chances are you are seeing this animal for the first time. Any idea what it is? Look at that. The answer coming up.

(COMMERCIAL BREAK)

BLITZER: Lisa Sylvester is monitoring some of the other top stories in THE SITUATION ROOM right now.

What do you have, Lisa?

LISA SYLVESTER, CNN CORRESPONDENT: Hi, there, Wolf.

Well, the U.S. is transferring two detainees from its detention facility at Guantanamo Bay, Cuba. The Defense Department says they will be turned over to the governments of their native countries, Algeria and Cape Verde. Their cases were examined by the Guantanamo review task force as part of President Obama's 2009 executive order. More than 170 detainees remain at the detention facility.

And at least 60 people are dead and more than 90 injured in India after a moving train rammed into a stationary one. The impact sent the roof of one train compartment flying onto an overpass. Emergency crews were forced to use blowtorch-like cutters to free passengers from the wreckage. India's rail system has been plagued with safety issues.

And don't be surprised if you have no idea what this is. Take a look at this picture. researchers in Sri Lanka have just captured the first photograph of this rare nocturnal primate known as the Horton Plains slender loris. It is so reclusive that it has been spotted only four times since the 1930s. Big old beautiful eyes there. This photograph helped scientists prove the existence of the species, which some feared had gone extinct.

And a popular teenage clothing store chain is getting some heat for its new maternity line. Forever 21 has launched its "Love 21" line in states like Texas, Arizona, and California. The issue, critics say, is that those are states with high teen pregnancy rates. The company says the states are not a part of its marketing strategy -- Wolf.

BLITZER: Thanks, Lisa. Stand by.

New fireworks involving BP and another company with a stake in the oil disaster. We're going to tell you what they're arguing about right now.

And James Carville and Ed Rollins, they are here on whether the Afghan War is still worth fighting.

(COMMERCIAL BREAK)

BLITZER: You're in "THE SITUATION ROOM". Happening now, a revealing investigative report is raising fresh concerns about the U.S. national security operation. Is the country's safety at risk? I'll talk to the co-author of the report. Stand by.

And he was once labeled by some in his own party as a political plant, but did a new campaign speech help Democrat Alvin Greene gain some new supporters in his bid to become South Carolina's next U.S. senator? I'm Wolf Blitzer. You're in "THE SITUATION ROOM".

Let's get back to our top story this hour. Another 24 hours of testing now under way on the new well cap in the Gulf of Mexico. Officials are keeping close watch on pressure readings and possible leaks, but so far the incident commander, Thad Allen, says no significant problems have been detected.

It has now been four days since the cap shut in the well and stopped the oil that had been gushing since April. Still, protesters are planning to gather right here in Washington tomorrow, exactly three months after the rig explosion that unleashed this disaster. Mary Snow has been monitoring a hearing today on the cause of the explosion.

Mary, I take there were some fireworks.

MARY SNOW, CNN CORRESPONDENT: There were, Wolf. And now these are hearings conducted by the Coast Guard and the Interior Department. And there is the possibility that some people may eventually face criminal probes. At today's hearing in Kenner, Louisiana, things grew tense as a chief engineer testified.

(BEGIN VIDEOTAPE)

UNIDENTIFIED MALE: Mr. Bertone, will you please raise your right hand?

SNOW (voice-over): Investigators trying to determine what caused the Deepwater Horizon oil rig to explode turned to the chief engineer of Transocean, the company that owns the rig. Stephen Bertone testified about the final hours on the rig, but would not answer specific questions about a statement he provided 26 hours after the explosion.

UNIDENTIFIED MALE: Did anyone tell you to leave anyone behind?

ROBERT HABANS, BERTONE LAWYER: Do not answer that question.

It's contained -- any information about that is contained in his statement. SNOW: Bertone would only acknowledge the statement he gave hours after the explosion was truthful. But things got heated when a lawyer for BP asked him about the emergency disconnect system that could have stopped the flow of oil and gas to the rig.

UNIDENTIFIED MALE: So was it truthful that when you wrote that when you reached the bridge you heard, quote, "the captain screaming at Andrea (ph) for pushing the distress button," end quote? Was that a truthful statement?

HABANS: I object to that. Same objection, Captain. We've gone through this 10 times today. I instruct the witness not to answer anything, specifically a question on this statement.

UNIDENTIFIED MALE: I object to the relevance of the question. It has no relevance to what we're here for.

UNIDENTIFIED MALE: The relevance is it reflects a complete loss of command and control on board the bridge at a time when they're just trying to decide. They've had two explosions and there is an argument about whether they're in a distress situation or whether to activate the EDS, that is the relevance.

UNIDENTIFIED MALE: I agree. (INAUDIBLE). Noted -- I note no objection. Mr. (INAUDIBLE), please proceed.

SNOW: When workers did activate the EDS system, it did not work. Bertone also testified that the rig's thruster was having problems eight months before the accident. As the Coast Guard and the unit of the Department of Interior tried to pinpoint who is at fault, one former prosecutor says, criminal charges are likely at some point.

STAN ALPERT, FORMER CHIEF ENVIRONMENTAL CRIMES PROSECUTOR: People were making decisions to continue on, to keep drilling here, even though the rig needed maintenance. Whoever knew those things and made the decision to go ahead anyway has a serious problem with criminal liability.

(END VIDEOTAPE)

SNOW: And the former prosecutor we spoke with says being designated as a "party of interest" means there's a possibility of a criminal investigation. Now, Stephen Bertone, the Transocean engineer who testified today, was told he is not a "party of interest," but the captain of the rig has been put in that category along with others -- Wolf.

BLITZER: Mary Snow, thanks very much.

Let's continue the conversation with our CNN political contributors, Democratic strategist James Carville, and Republican strategist Ed Rollins.

Guys, thanks very much for coming in. James, you're in New Orleans right now... It seems to be a little bit of a rollercoaster moment by moment. It seems to be working, then there're some problems, seems to be working, some other problems. What's it like there?

JAMES CARVILLE, CNN POLITICAL CONTRIBUTOR AND DEMOCRATIC STRATEGIST: Well, everybody's watching it and wondering, you know, this thing is putting pressure somewhere else. I mean, the real thing is everybody wants this relief well to come in. I think people are going to feel better when that happens. But, you know, who knows?

I think Admiral Allen's, you know, doing a good job and they're doing the best they can, but this thing is a mile below the surface of the - of the gulf and until a relief well is built and the pressure's off, people are just going to be concerned. There's no doubt about it.

BLITZER: It would be a huge blunder for the administration, Ed, right now to declare a victory, mission accomplished.

ED ROLLINS, CNN POLITICAL CONTRIBUTOR AND REPUBLICAN STRATEGIST: Oh, I don't think they can do that and I don't think they intend on doing that. I think that they basically are trying to be as - as due diligent as possible. I mean, the last thing that they want to do is declare victory and something occurs in a day or two days or a month. I think, at this point in time, their job is to keep moving forward and to make sure that all safety valves are protected and that the environment that's already been badly damaged by this is not damaged any further.

BLITZER: And - and, James, earlier in the - in the hour we spoke to Carol Browner, the president's energy adviser. She said that moratorium on deepwater drilling is going to continue until they're really sure that it's safe. I know you have a problem with that.

CARVILLE: I do, and - and I think one of the things that we can do is - is we could put -- Carol Browner can put, designate on each of these rigs that's been shut down and have them out there. We could do any number of things. They could - they could drill and not penetrate the reservoir.

But I think she is a very competent person. I'm not sure she understands the economic devastation that's being caused down here, the double blow to the people of South Louisiana. And, you know, this stuff has been done, can be done safely. If you - if you look at these hearings today, people were operating this rig in an irresponsible manner and I'm - I'm heartened to see that people are talking about bringing people to the bar of justice, because there's nothing that's going to ensure safety out there than the other - the oil - oil company people, other rig operators seeing that if you make negligent decisions that you can be put in jail for.

Now, that's a very important, integral (ph) part of this.

BLITZER: Ed, let me move on to Afghanistan right now, because we've had a lot of critics from the left, some Democrats who have been upset by the president's strategy in Afghanistan. But now, increasingly, we hear some Republicans, including Richard Haass who served in the State Department under Secretary of State Colin Powell at the Policy Planning Staff, he writes this, and I'll read it to you, in the new issue of "Newsweek", "The war the United States is now fighting in Afghanistan is not succeeding and is not worth waging in this way. The time has come to scale back U.S. objectives and sharply reduce U.S. involvement on the ground.

Afghanistan is claiming too many American lives, requiring too much attention and absorbing too many resources. The sooner we accept that Afghanistan is less a problem to be fixed than a situation to be managed, the better." He's the president of the Council on Foreign Relations, as you know, right now.

Are more and more Republicans now expressing their concern that Afghanistan is worth fighting?

ROLLINS: Well, I think so. You know, Richard's a friend of mine. I respect no one more than - than he in the foreign affairs arena.

But I think what's important today is we have 100,000 American troops there and another 40,000 NATO troops. We've just put Petraeus in. Let Petraeus give an assessment. This is not just a foreign policy, diplomatic thing. This is a can we do something on the next two years to basically stabilize this place for long term?

It's not going to be Iraq. That was, it doesn't - didn't begin with the foundation that Iraq had, but can we at least stabilize it, build a military that can hold some of this Taliban from coming back? If we can do that, then it's worthwhile, but you are going to find Republicans starting to join a lot of Democrats who aren't very happy with the - with the results there so far.

BLITZER: Yes. In recent days Michael Steele and George Will, Ron Paul, a bunch of Republicans, James. But you know there are a lot of Democrats and liberals on the left who - who don't like this strategy either.

CARVILLE: Well, I don't know of anybody that really likes the strategy, to be honest. I think the president inherited, you know, a lot of things, just an awful mess, and we've put - put more troops in there. We've put our best young people there. We've put our best generals in. We've put our money in this, and, you know, this is what a war looks like that's not going well.

People get frustrated by it and - as they should. And, you know, look, Iraq, they're now breaking the embargo with Iran. They're teaming up with Iran on thing after thing. You know, I don't know if a lot of thought was given to these wars, to be honest with you, and we're going to have to rethink them and people are starting that process now.

BLITZER: But you agree with -

CARVILLE: But I don't know how you - you draw down.

BLITZER: Do you agree with Richard Haass that the U.S. should get out?

CARVILLE: Well, he says that we should draw - we should draw down or we should have fewer people there. I don't know if having fewer people there helps. And, you know, (INAUDIBLE) Vice President Biden has certainly been on this, and any number of people have questioned this. And, you know, it's a big mess and - and people are going to question everything, and I think that the administration really needs to take a good, hard look at its policy.

But if you get out what are the consequences of that? How do you get out of there? That's, you know - wars are like affairs, Wolf. They're - they're easy to get into and they're hard to get out of. We're finding that out.

BLITZER: James Carville, Ed Rollins, guys, thanks very much.

New evidence of Sarah Palin's political power. She's apparently making a big impact on tomorrow's Republican gubernatorial primary in Georgia.

And Bill Clinton reveals what he wants to do before he dies.

(COMMERCIAL BREAK)

BLITZER: Lisa Sylvester is monitoring some of the other stories in "THE SITUATION ROOM" right now. What else is going on, Lisa?

SYLVESTER: Hi, Wolf.

Well, former vice presidential candidate Sarah Palin could make a mark in tomorrow's Georgia Republican gubernatorial primary. The candidate she is endorsing, Georgia's Secretary of State Karen Handel, has surged to the top of a new Mason-Dixon survey with 29 percent of likely voters supporting her. That is up six points from a similar poll conducted just before and during Palin's endorsement last week.

And if he has his way, Bill Clinton could soon be climbing Africa's highest peak, Mount Kilimanjaro. The former vice president - the former president, rather, told those gathered at International AIDS Conference in Austria that climbing the 20,000-foot mountain is something he hopes to do before he dies. Also on that list, running a marathon.

And while climbing mountains might be in the Clintons' future down the road, it is probably safe to assume that the fast approaching wedding of their daughter, Chelsea, well, that is a top priority right now. Secretary of State Hillary Clinton isn't sharing many details about the upcoming event, which, in case we're all keeping track of this, it is now less than two weeks away. When asked about the guest list, she said that the people coming are those that have been meaningful in Chelsea's life.

And also, President Clinton said, you know, what else is on his bucket list is he wants to be a grandfather. Isn't that nice, Wolf?

BLITZER: One of these days. God willing, it will be (INAUDIBLE).

We wish Chelsea and her fiance, Marc Mezvinsky, only the - only the best, and the parents and everybody else as well.

Thanks very much for that.

In the wake of a bitter controversy over race, the Tea Party Movement reassessing right now. What is going on? We'll assess ourselves.

And a new report now suggests a major downside to the government's bailout of the auto industry. Lisa Sylvester has the details.

(COMMERCIAL BREAK)

BLITZER: Some faction (ph) of the Tea Party Movement are ripping wide open right now after the NAACP accused elements in the Tea Party Movement of racism. The National Tea Party Federation has now expelled a high profile faction of the movement, the Tea Party Express, and its spokesman, Mark Williams. You'll remember Williams wrote an online post last week mocking the term "colored people" in the NAACP's name, among other things.

The National Tea Party Federation, which wants to represent the entire Tea Party Movement, issued a statement today, saying this, let me read it to you, "Most of you are aware one of the leaders in the Tea Party Movement posted a controversial blog many took to be racist. The Tea Party Movement is not racist. Tea Party Nation and many other groups have repudiated racism and racists."

Our senior political analyst Gloria Borger is here. She's been following this controversy for us. How much of a problem is this for the Tea Party Movement?

GLORIA BORGER, CNN SENIOR POLITICAL ANALYST: It's growing pains, Wolf. You know, some people are calling it a circular firing squad, some people calling it a war.

Look, this is not a political party. It's a grassroots political movement, and right now they're trying to figure out who's in charge. Is it the Tea Party Nation? Is it the Tea Party Express? Is it the Tea Party Federation, which is supposed to be the umbrella organization? It's completely unclear and they're trying to figure out how they would derive the most power.

And lots of folks in the Tea Party Movement say leave it where it is. Leave it at the grassroots. Let the power bubble up from the grassroots, and forget any kind of umbrella organization.

BLITZER: As you know, some Democrats in Nevada are pouncing on Sharron Angle -

BORGER: Yes.

BLITZER: -- the Republican senatorial candidate, facing Harry Reid and her connection to Mark Williams, the spokesman for Tea Party Express.

BORGER: That's right. You know, Mark Williams made sure that she was part of the group that gave her $500,000, the Tea Party Express. You see all of these candidates - let's take a look at some of these candidates here. We've got Scott Brown, Marco Rubio, Nikki Haley, Rand Paul, Kentucky.

These are folks who were not household names, Wolf, and they have done very well, just like Sharron Angle. She, by the way, has disavowed Williams' inflammatory language but she didn't associate herself from that particular wing of the Tea Party. It's going to be the Democrats now, Wolf, who are going to try and drive wedges inside the Tea Party to divide and conquer them if they can.

BLITZER: Marco Rubio, by the way, is going to be here in "THE SITUATION ROOM" -

BORGER: Oh, great.

BLITZER: -- tomorrow. We'll talk to him about this and some other stuff as well. I guess some Republicans are concerned that if the Tea Party Movement gets too powerful it could push away moderates.

BORGER: Right. And I think this is the problem right now. There was a recent poll in "The Washington Post". Let's take a look at it. You'll see that - if we get it up, but back in March there were more favorable than unfavorable ratings - there you see - for the Tea Party. In June, it flipped - unfavorable 50 percent, favorable 36 percent.

What this means, Wolf, is the people are giving the Tea Party a second look. Those Independent, Moderate Republican voters, and don't forget this is the movement 80 percent of whom are Republicans, and they're taking another look at the Tea Party and they're saying, you know, gee, maybe it's not what I want.

But, Wolf, in the short term, it's good for the Republican Party, because these are the people who are intense and enthusiastic and will get out there and vote against Democrats in the fall.

BLITZER: In the midterm election that's what you need, energized folks -

BORGER: Short term, very good for them.

BLITZER: -- to do it and these people are motivated. All right. Thanks very much.

A government watchdog is reporting a major downside to the federal bailout of the auto industry. A new report says Chrysler and GM were pressured to quickly close hundreds of dealerships without regard for jobs that would be lost.

Lisa Sylvester is back. She's been looking into this story. What are you finding out, Lisa? LISA SYLVESTER, CNN CORRESPONDENT: Well, Wolf, the special inspector general, he doesn't take issue that some dealerships were closed, but it was the pace of the closings, the number of closings, and the fact that the Treasury Department did not look at the potential impact on jobs.

(BEGIN VIDEOTAPE)

SYLVESTER (voice-over): In 2009, General Motors began terminating nearly 1,400 of its dealerships nationwide. Chrysler, more than 800 dealerships. Among those impacted, Maryland auto dealer, Jack Fitzgerald. Four of his auto franchises were lost.

JACK FITZGERALD, MARYLAND AUTO DEALER: It was wrong. It was obviously wrong. Anyone in the business knows that that was wrong. It was a mistake. It was really hurting Chrysler and GM. It wasn't helping them. And it was hurting the economy. Everything about it was wrong. It was a bad idea.

SYLVESTER: As the economy was in a tailspin in early 2009, auto companies were required by the Obama administration to restructure as a condition to receiving federal bailout money. But a new report from the special inspector general overseeing the T.A.R.P. bailout program found the president's auto task force largely ignored the impact on jobs.

The inspector general says, in fact, the auto dealership closings were not vital to the survival of the automakers.

NEIL BAROFSKY, SPECIAL INSPECTOR GENERAL, TARP: As they (ph) suggested in their letter that if they hadn't done this accelerated job loss for the dealership closings that this somehow would have put the auto companies in jeopardy? That they would have failed immediately? That's just not true. We saw nothing to support that.

SYLVESTER: The report comes just months before the midterm elections and with unemployment at more than 9 percent. A Republican lawmaker from Michigan says it reflects poorly on the administration's actions.

REP. PETER HOEKSTRA (R), MICHIGAN: When a dealership lost the franchise, you saw sales people losing their jobs. It was wrong and they received no compensation for it.

SYLVESTER: White House Press Secretary Robert Gibbs strongly disagrees with the report's conclusion saying the White House should be credited with saving auto industry jobs.

ROBERT GIBBS, WHITE HOUSE PRESS SECRETARY: Because of the president's actions today, there are tens of thousands of auto jobs, auto manufacturing jobs that exist, auto dealership jobs that exist and auto parts manufacturing jobs that exist.

(END VIDEOTAPE)

SYLVESTER: Now, since the initial round of dealership cuts, both GM and Chrysler have voluntarily reinstated agreements with some of their dealerships. Several other auto dealers appealed to an independent arbitrator and also have their agreements reinstated, Wolf.

BLITZER: All right. Lisa, thank you. Lisa Sylvester reporting.

Jack Cafferty wants to know how effective can U.S. Intelligence be when nearly 1,300 government organizations and 2,000 private companies working in 10,000 different locations?

And he's the developer behind the controversial plan to build an Islamic Center and mosque just steps away from the World Trade Center. CNN's Deborah Feyerick talks to him. That's coming up.

(COMMERCIAL BREAK)

BLITZER: Jack is back with the "Cafferty File".

CAFFERTY: The question this hour straight out of "The Washington Post" which will undoubtedly win a Pulitzer Prize for their two-year investigation into this.

How effective can U.S. Intelligence be when there are 1,300 government organizations, 2,000 private companies working at 10,000 different locations?

John in West Virginia says I'm a retired federal agent, and I have to say I really don't think the traveling public is one bit safer today than they were before 9/11. It is a good example of throwing money and manpower at a problem nobody seems to understand, that of the perception of threat versus the threat itself.

The terrorists have already accomplished one of their major goals, causing the United States to spend billions of dollars to protect itself against the perception of a threat.

Kevin in Pennsylvania says U.S. Intelligence can neither be very effective nor very efficient with so many agencies essentially all looking at the same potential risks. Although I have no doubt redundancy in government is the accepted norm, 1,300 organizations does seem to be a bit of a stretch, even for the feds.

Grant writes, probably not very effective if that's indeed how big it has grown. And you're right, we had trouble with the recent events you mentioned and couldn't connect the dots that led up to 9/11 in the first place. Bigger isn't necessarily better. Better is better.

Kyle in Pennsylvania writes, this makes absolute sense if you recall that the Bush administration declared war on 9/11 against terror. With such a broad nebulous unwieldy enemy, a system that's just as cumbersome was bound to be built in order to fight it.

Michael in Virginia writes, the entire organization is not effective, although I am sure there are components which are. I think the last thing we want, of course, is a really effective covert intelligence apparatus that includes within its purview spying on Americans. Thank God for government inefficiency.

Lucas writes, the effectiveness of the intelligence community of over 1,000 government agencies is like a gas-guzzling SUV. All it does is suck us dry of our money.

And Dave in Pennsylvania writes I'm looking for a better job. Are they hiring at the Department of Redundancy Department?

If you want to read more on this, it's a fascinating story. Got to my blog, cnn.com/caffertyfile, you'll read the e-mails. Check out "The Washington Post" for the whole story. It's a - it really is quite an accomplishment, this thing (INAUDIBLE).

BLITZER: Yes. We're going to be speaking in the next hour to the co-author of that article too, Jack. Thank you.

CAFFERTY: Yes.

BLITZER: Up next, building up Mississippi by singing the blues.

(COMMERCIAL BREAK)

BLITZER: Mississippi has reason to sing the blues especially in the wake of massive oil disaster in the Gulf of Mexico. Despite that, those songs are building up America. Here's CNN's Tom Foreman.

(BEGIN VIDEOTAPE)

TOM FOREMAN, CNN CORRESPONDENT (voice-over): Anytime, any day, you can hear blues in the Delta. This is the land of legends, Muddy Waters, B.B. King -

And it's home to their musical heirs like Terry "Big T" Williams.

TERRY "BIG T" WILLIAMS, BLUES MUSICIAN: I don't care if it's a - if it's a fast played blues or a slow played blues, it's still saying something about I'm feeling bad, but yet still life is OK and -

FOREMAN: And lately, life has been more than OK here even in wake of the oil spill, Katrina and all the economic turmoil, because of a rising tide of blues tourism. At the Delta Blues Museum, the crowds are growing so steadily with people from every state and dozens of foreign countries that it will soon be expanded to more than twice its size.

This town alone pulled in $54 million from visitors last year, people tracing the history of blues and rock to a string of historic sites throughout the region called The Blues Trail. Kappi Allen is with the country tourism commission.

KAPPI ALLEN, DIRECTOR OF TOURISM: This year, so far, we've seen an increase of 13 percent in our tourism tax numbers.

FOREMAN (on camera): And all of that in the middle of a recession?

ALLEN: Absolutely. We are open for business.

FOREMAN (voice-over): Some say the surge is because the blues speak to folks in hard times. Some say it's because people here are doing a better job marketing their attractions.

But Bill Luckett, an owner of the Ground Zero Blues Club, says whatever the cause, the results are undeniable.

FOREMAN (on camera): How important do you think that is to building up this part of America in these hard times?

BILL LUCKET, GROUND ZERO BLUES CLUB: Well, we have lost a lot of our factories, a lot of our base manufacturing wise. Blues music and tourism and interest in blues music is replacing that as an industry.

FOREMAN (voice-over): According to lore, the great bluesman Robert Johnson met the devil at this cross roads and traded his soul for the gift of music. That's just a legend, but this is a fact.

WILLIAMS: The tourist attraction used to be seasonal. Now, it's - it's year round. They come all the time.

FOREMAN (voice-over): And in the wake of so many problems for many folks, that feels heaven sent.

WILLIAMS: Yes.

(END VIDEOTAPE)

FOREMAN: The folks up in Clarksdale where we shot that story and all around there have long known how much the coast means to them. Now they're returning the favor by building up that part of the state, helping their state out while the coast struggles with other problems, hoping that for all of them, it makes for a stronger state in the future - Wolf.

BLITZER: That's Tom Foreman. Thanks very much.

Here in "THE SITUATION ROOM" happening now, anomalies at the BP oil well in the Gulf of Mexico so far...