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THE SITUATION ROOM

Where Did All the Oil Go?; Judge Blocks Part of Arizona Immigration Law; BP Drilling by Land or by Sea?

Aired July 28, 2010 - 17:00   ET

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


SUZANNE MALVEAUX, CNN ANCHOR: Happening now, breaking news. The most controversial parts of Arizona's immigration law are blocked from taking effect just hours from now.

CNN correspondents, they are out in full force covering the ruling, the reaction, and what's next.

Also this hour, how every American could be touched by what is happening in Arizona. The nationwide fight over protecting our borders is as heated and uncertain as ever.

And 100 days of disaster. The worst oil spill in U.S. history marks a milestone. And we are asking the tough questions about how, why, so much oil seems to have vanished?

Wolf Blitzer's off today. I'm Suzanne Malveaux.

And you're in THE SITUATION ROOM.

We begin in the Gulf Coast with the shocking turn of events that few of us would have imagined just a hundred days ago. Well, we watched millions of barrels of oil gush into the water week after week, but now BP and federal officials are not finding a whole lot of oil left on the water. So should residents celebrate or should they worry that there is still hidden oil out there?

Our CNN's Rob Marciano is in Fort Pickens, Florida.

And Rob, you're on the ground there. What are you seeing?

ROB MARCIANO, CNN CORRESPONDENT: Well, you know, even on the beach we're still seeing some tar in spots, but the key about what's happening out there in the Gulf waters is that that well has been capped now for almost two weeks. So, if you think it was gushing at 50,000 barrels a day, that's, you know, over a half million barrels of oil that hasn't spewed into the Gulf in the last 12 days. That is significant.

On top of that, they have obviously had the skimmers out there, and I think Bonnie, albeit a very, very weak storm, banged around the Gulf pretty good, and that likely dispersed some things. So I think that is one of the reasons that they haven't found much in the way of oil. They are keeping all of the skimmers on standby just in case.

So, for all the optimism that we've seen in the past couple days, the admirals in command, specifically Rear Admiral Zukunft, he remains cautious.

(BEGIN VIDEO CLIP)

REAR ADM. PAUL ZUKUNFT, U.S. COAST GUARD: I would characterize this as the first hundred days. There is a lot of work in front of us. Until we have a permanent well kill, I have every skimmer available, I have every responder, every Vessel of Opportunity available should this very dynamic evolution, this operation, change on a moment's notice. We are there to respond.

(END VIDEO CLIP)

MARCIANO: Certainly the record that they've had as far as failures go, there is reason to be cautious and not to sleep very well until that well is permanently killed. They gave an example.

Even if they were to start pulling in the boom, all of the boom that they have out there, if they started pulling it in at 60 miles per day, they would still have boom to bring in on Labor Day. And that is significant because they know they're getting into the heart of hurricane season, and that boom, during a hurricane, would do more damage to the wetlands than good. So, once this well is killed for good, they'll start to bring some of that boom in.

All right. As far as what is happening on the beaches, especially in north Florida and Alabama, well, they got hit pretty hard a few weeks ago with tar and tar patties and patches of heavy tar. And they've done a good job of cleaning up the beach. But as you'll see in some of this video, when you shine a UV light on the beaches at night, the patches of oil and particulates of oil will actually glow orange.

And we got out here a couple of nights ago and we saw these patches of oil. We dug into the sand, and we saw that even at some of the layers beneath the surface of the sand, you could see some of this oil and oil particulates.

So, we decided to take a sample of the sand here and bring it to the University of West Florida for analyzation. Well, we wanted to know just how many parts per million were in the sand as far as oil is concerned. And here is what the scientists there had to say.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: 2.6 parts per million of oil in that sand sample that was given to us.

MARCIANO: 2.6 parts per million. That number, what does it mean to people watching at home?

UNIDENTIFIED MALE: A, it says the oil is there. B, the oil is there at low levels.

MARCIANO: Possibly healthy or safe levels?

UNIDENTIFIED MALE: Not necessarily hazardous levels.

(END VIDEO CLIP)

MARCIANO: Well, that certainly is somewhat optimistic. At least the scientists agree that that is a relatively low level.

But we took a pretty sporadic sample. There are areas of this beach that certainly have higher concentrations.

Just walking up and down the beach today, we saw patches of tar, plain as day. There are patches of stained sand, and certainly they would measure to be of a higher concentration.

So, I guess here, as we stand on the 100th day, Suzanne, with all the optimism out there in the Gulf of Mexico, with the well, and hopefully killing it here in the next week or two, there is still oil here on the beaches. This is not easy to clean up, if at all, and there will likely be more particulates rolling up on the beaches in the weeks to come.

So this story is not over.

MALVEAUX: And Rob, it's fascinating that you can't actually see the oil, and that you use that equipment and it becomes very visible. Still a big mystery in terms of where all of this oil has gone.

There is a new snapshot here of the oil disaster after a hundred days. There's an estimated three million to 5.2 million barrels of crude that oozed into the Gulf before the new well cap sealed that leak about two weeks ago. Now more than one million barrels of crude has been collected, flared or burned. More than 825,000 barrels of oily liquid has been skimmed from the Gulf, and almost two million gallons of dispersants have been used to break up the oil on the water's surface and beneath it.

Now to the breaking news out of Arizona.

A federal judge temporarily blocks part of the state's controversial immigration law that was due to take effect within a matter of hours. Now, this injunction specifically targets provisions that critics were afraid would lead to racial profiling.

The Obama administration, which challenged the law, says that the judge ruled correctly. Arizona Governor Jan Brewer, not surprisingly, is calling this a bump in the road and is moving, and says she is vowing to move forward.

Our Senior White House Correspondent Ed Henry is standing by, but first I want to go to CNN en Espanol correspondent Juan Carlos Lopez, who's in Phoenix.

Give us a sense -- you are on the ground there -- of the reaction from the residents, the folks on both sides to this decision.

JUAN CARLOS LOPEZ, CNN EN ESPANOL CORRESPONDENT: Suzanne, it is very interesting that folks on the ground from both sides are claiming this as a victory. Some talk about it a disappointment, but they are claiming it as a victory. And we'll talk about that in a moment. But first, let's hear what the governor of the state, Governor Jan Brewer, had to say about today's ruling.

(BEGIN VIDEO CLIP)

GOV. JAN BREWER (R), ARIZONA: We don't really exactly know where we're going to go. We knew regardless of what happened today, of course, that one side or the other side was going to appeal.

So this begins the process. This is an injunction. They haven't heard really the merits of the bill. This is just an injunction, a temporary injunction.

(END VIDEO CLIP)

LOPEZ: The Justice Department filed one of the lawsuits, and in a statement, the Justice Department says that, "While we understand the frustration of Arizonans with the broken immigration system, a patchwork of state and local policies would seriously disrupt federal immigration enforcement and would ultimately be counterproductive."

Other reactions, the Center for Immigration Studies, the think tank that studies the issues of legal and illegal immigration, said in a statement they are disappointed but not surprised. And Republican from California Darrell Issa put out a statement saying that, "The federal government has a right and a responsibility to enforce existing laws, but they shouldn't get in the way of states that take action when they decide to fight the drug cartels, border violence and human smuggling" -- Suzanne.

MALVEAUX: OK. Juan Carlos, thank you so much.

I want to bring in our senior White House correspondent, Ed Henry, at the White House.

Obviously, there is a lot that is going on outside the White House because of this decision. A lot of emotions on both sides.

Set the scene for us, Ed.

ED HENRY, CNN SR. WHITE HOUSE CORRESPONDENT: Yes. There is a rally. Most of the people literally just left, but there were maybe a couple hundred people, mostly Hispanic children with their parents, wearing T-shirts saying, "Don't deport my mom, don't deport my dad," and sending a message directly to the president. They had signs saying, "It's in your hands, Mr. President" to deal with this whole immigration reform issue.

The White House, in part because of protests like this, breathing a sigh of relief behind me. When you talk to senior administration officials, they basically see this as a short-term victory, but they're not going to celebrate, because they realize there is a big legal and political battle ahead of them.

Number one, as Juan Carlos was just pointing out, Governor Brewer basically signaling that she is taking a close look of course as well, likely to appeal this. It could even go to the U.S. Supreme Court. So they know this is not done.

And the other key piece moving forward is the White House also realizes that this whole debate playing out in Arizona points up the fact that when you have this patchwork system of laws in localities, different states, other states are going to follow Arizona and take the matter into their own hands when there is a vacuum at the federal level until you have comprehensive immigration reform. So the White House is trying to put the onus on Senate Republicans and say look, work with us on a comprehensive bill. The president gave a big speech on that July 1st, and they say if you had some action at the federal level, you could head off some of these big disputes on the local and state level -- Suzanne.

MALVEAUX: Ed, we know that the president is in New York. He's doing some fund-raising. Obviously, he has been briefed on all of this. We saw years and years of President Bush trying to push for comprehensive immigration reform, and it never happened.

Is there anybody that you are talking to today who feels any more optimistic that they can get that through now?

HENRY: They really don't, because the White House will tell you in private the president has reached out to Republicans like Lindsey Graham, Scott Brown of Massachusetts, and hasn't made a lot of headway so far. But they're still going to keep pushing this, hoping there will be a bipartisan deal, but in an election year that's hard.

The president is in New York right now, as you noted. He's raising money just three months out from the midterm elections. With passions running so deep, it's going to be hard to sort of get the Congress focused in these final days before the election on such a difficult emotional issue like immigration reform.

And I'll also note that I can tell you my sources are telling me there was a meeting last night inside the White House behind me, where one of the issues that came up was this immigration reform battle. And there was fear that if the law were to move forward and the judge had not stepped in, there was fear there were going to be huge protests in Arizona, real chaos on the streets.

And the White House is nervous that even now with the judge sort of blocking the key parts of the law, there is still going to be -- the controversy has not gone away, and it could be another distraction. You know the president has been trying to focus on jobs and the economy. Then you had the oil spill, you had the Shirley Sherrod story. Now this big emotional debate.

They realize it's harder and harder for him to get out there and focus on jobs and the economy, which is what he wants to do in these waning days before the election -- Suzanne.

MALVEAUX: It has been very difficult for the White House to get people to pay attention to that.

Thank you, Ed. A hundred days into the Gulf oil disaster, we are looking at places where the next big spill could happen. It is another BP drilling project under scrutiny.

Stand by for an update on an oil spill in Michigan and whether it might taint the Great Lakes.

And the ethics charges Congressman Charlie Rangel faces tomorrow, unless he hurries and cuts a deal.

(COMMERCIAL BREAK)

MALVEAUX: In the wake of the Gulf oil disaster, another BP drilling project is drawing second looks.

Drew Griffin of CNN's Special Investigations Unit juourneyed inside the Arctic Circle to Alaska's Prudhoe Bay to bring us the controversy.

(BEGIN VIDEOTAPE)

DREW GRIFFIN, CNN SPECIAL INVESTIGATIONS CORRESPONDENT (voice-over): We are three miles out to sea off the North Slope of Alaska. Take a look down through that fog. That's a drilling rig on a tiny manmade island.

BP owns the rig and dumped tons of gravel into the water only 22 feet deep to build up this island. Cost so far? About $1 billion.

BP says with Arctic ice floes, drilling from an island is safer than off a floating rig. But environmentalists claim that tiny island is a clever way of gaming the federal permit system.

Attorney Rebecca Noblin represents one of a half-dozen environmental groups.

REBECCA NOBLIN, ALASKA CENTER FOR BIOLOGICAL DIVERSITY: If anything were to go wrong, if there were an oil spill, that oil is going into the ocean. It's not on land. So, this really is -- this is drilling in water.

GRIFFIN: That's the heart of the debate. Does putting the massive drill rig on a 32-acre pile of gravel mean BP's Liberty Island project should be subject to federal rules for drilling on land, or should it be subject to the more rigorous rules of offshore drilling?

The fact is, three years ago, BP succeeded in getting a land- based drilling permit. In an e-mail to CNN, a BP spokesman says the company "carefully followed the state and federal permitting systems." And addressing environmentalist complaints, he added, "It's hard to imagine anyone who knows the facts or the history of this project would make such a claim."

(on camera): But after the Gulf oil disaster, federal and state regulators aren't so confident in BP's plans to drill out here on Liberty Island, now are taking another look. (voice-over): One of the reasons? Environmental groups say MMS approved BP's environmental review in 2008 with minimal changes. We asked the Interior Department for comment, twice in fact. But they declined to answer, only saying -- quote -- "In light of the BP oil spill in the Gulf and new safety requirements, we will be reviewing the adequacy of the current version of the Liberty project's spill plan."

There is something else you should know about this so-called "onshore drilling project." BP's plan calls for drilling two miles under the island, and then going sideways to drill six to eight miles offshore. It's called ultra-extended-reach drilling.

A BP brochure calls the plan "one of the oil and gas industry's most significant technological advances."

The main risk is what's termed a gas kick, undetected methane bubbles in a sideways pipe and, of course, the inability to control a huge oil spill in an already fragile environmental.

NOBLIN: We don't have the ability to deal with it, if anything goes wrong. If there's an oil spill in the Arctic, we just -- there isn't the infrastructure that there is in the Gulf to deal with it. And we're seeing in the Gulf, even when there is infrastructure, when there are people in boats and boom and dispersants and all that sort of thing, they still can't deal with an oil spill.

GRIFFIN: We asked BP for permission to visit Liberty Island, and the answer was no.

(on camera): This is as far as BP would allow us to get to their Liberty Island project. It's a security gate at the Endicott oil field -- no interviews, no tours. BP says it's for security reasons. If you want to actually see what they're doing out in the ocean here, you have to fly.

(voice-over): But we wanted to see the island so we could see what this sideways drilling might mean in this environment. First thing we noticed: Liberty Island is connected via a causeway to another BP operation called Endicott Island. Four years ago, BP was fined because oil and diesel fuel had been dumped into the Arctic from Endicott Island.

The company says it will cooperate with any federal and state regulators who want to take another look at BP's plans three miles out at sea on its Liberty Island.

Drew Griffin, CNN, Prudhoe Bay, Alaska.

(END VIDEOTAPE)

MALVEAUX: A passenger plane slams into a hillside on landing, killing everyone on board, more than 150 victims. We are learning new details.

Also, thousands of people flee their homes as fire closes in. It is now a state of emergency.

Plus, billions of dollars spent to beef up the fence along the U.S./Mexico border. So why are so many people still able to cross illegally?

We're going to take you to the front line.

(COMMERCIAL BREAK)

(NEWSBREAK)

MALVEAUX: Well, critics' worst fears about Arizona's immigration law are targeted in a judge's new ruling. We're going to tell you exactly which of those provisions in the law are being blocked.

And we're at ground zero in the immigration war -- the border. Could a virtual fence with a multimillion-dollar price tag be the answer?

(COMMERCIAL BREAK)

MALVEAUX: Back to the breaking news.

A federal judge blocks parts of Arizona's controversial immigration law due to take effect at midnight local time. Now, the temporary injunction targets some of the most widely criticized provisions that fueled fears of racial profiling. Specifically, the judge blocked the requirement that police question those they detain about their legal status if they have reason to believe that those people may be in the U.S. illegally.

Now, these provisions were also blocked: one that makes it a crime for failing to have and carry alien registration papers; another that makes it a crime for an illegal immigrant to solicit, apply or perform work; and a measure that would allow an arrest without a warrant when there is probable cause that the suspect committed an offense that would result in deportation.

Now to the front lines of the battle over immigration, the fence that is supposed to stop people from crossing the border illegally.

Here is our CNN National Correspondent Gary Tuchman.

(BEGIN VIDEOTAPE)

GARY TUCHMAN, CNN NATIONAL CORRESPONDENT (voice-over): The border fence from the Mexican side. Here in Nogales, Mexico, the Spanish graffiti says, "The fence, a scar on the land."

This Arizona sheriff who strongly supports his state's new immigration law disagrees with that.

SHERIFF PAUL BABEU, PINAL COUNTY, ARIZONA: It's proven to have worked, but it has to be combined with constant surveillance in those areas. And it does shut down the border.

TUCHMAN: So why does Sheriff Paul Babeu of Pinal County, Arizona, and members of his SWAT team say human smugglers and drug smugglers parade through this desert 80 miles away from the Mexican border every single night, leaving piles of clothes, backpacks and water bottles behind as they plan their escape onto American highways? Because, the sheriff says, the fence needs to be longer and stronger.

He also says his deputies have been handicapped by not being able to ask about people's citizenship.

BABEU: We've become part of the front line here in this battle to secure our border. And quite frankly, we don't have the resources to be able to do it.

TUCHMAN: But people are going to still get past the fence in large numbers, despite the fact U.S. taxpayers have spent $2.5 billion on construction of the new fence which has taken more than four years to build.

So what's the problem? Well, the fence is probably not what you think.

It turns out it only covers about a third of the U.S./Mexican border, and there are already plans to build about six miles more. So while it keeps most illegal immigrants out of some areas, particularly urban areas, the rural areas are still very vulnerable.

(on camera): People use ladders, hacksaws, blow torches to get over, through, and under the fence. But there's a lot easier way; just find a portion of land where the fence comes to an end, go under the bar right here, and you have easily, successfully and illegally left Mexico.

(voice-over): But most illegal crossings happen nowhere near the new barriers.

(on camera): Despite all you hear about the border fence, this is mostly what you see along the 1,951 miles between the United States and Mexico, just little chain-link fences like this. I'm sitting in Mexico right now. It takes very little ingenuity. Just go under the barbed wire, and I'm in the United States, free to go.

(voice-over): The new border fences are white elephants, according to this Arizona congressman, who says if you have a 20-foot fence, people will just get a 21-foot ladder.

REP. RAUL GRIJALVA (D), ARIZONA: I think the wall took $2.5 billion that could have been used technologically, that could have been used for higher security of ports of entry, it could have been used for personnel, and diverted it.

TUCHMAN: So why isn't there more wall? You might be surprised to learn there was never supposed to be more wall under this $2.5 billion plan. The border patrol, topography, sensors in virtual fences were supposed to provide additional protection. In some cases it works and many others it doesn't. Another Arizona sheriff says drug traffickers have abundant incentive to beat the system.

SHERIFF TONY ESTRADA, SANTA CRUZ COUNTY, ARIZONA: They have a product and they're going to get that product to the market.

TUCHMAN: This past May one of Sheriff Babeu's deputies was shot and wounded in this very same part of the desert 80 miles north of the border, the gunman never captured.

SHERIFF PAUL BABEU, PINAL COUNTY, ARIZONA: This has basically been literally unfettered access by smugglers and illegals.

TUCHMAN: So the sheriff hopes the new law combined with the new fence makes his county safer while others remain angry at the law and regard the fence as a scar on the land.

Gary Tuchman, CNN, Nogales, Arizona.

(END VIDEOTAPE)

SUZANNE MALVEAUX, CNN ANCHOR: From an actual border fence to a virtual one, our homeland security correspondent Jeanne Meserve is looking into that aspect of the story. Jeanne explain what a virtual fence is.

JEANNE MESERVE, CNN HOMELAND SECURITY CORRESPONDENT: The big question is whether the virtual fence is a boon or a boondoggle. The system is a series of cameras and ground radars and sensors intended to stop illegal aliens on the border. It's also known by the way as SBI Net. $800 million has been spent so far on this system and what exactly has it bought? If you look at the entire border area you can see that there are two segments that are slated to be completed this year. One is 23 miles long in the Tucson sector and the other is 30 miles long in the Ajo sector. 53 miles of fence total and a cost of $800 million. You do the math. I realize we're talking about $15 million per mile. Supporters dispute that number and say there were a lot of first-time costs in developing the system and they figure it will cost $1 million to $2 million per mile if the entire system is built, Suzanne, and that is a big question.

MALVEAUX: Do we have any sense of whether or not this is actually working?

MESERVE: Well, I tell you, it has not delivered everything that was originally promised and the department of homeland security has frozen funding beyond the deployments in the Tucson and Ajo sectors until an assessment of the cost and effectiveness is completed. But it is not looking good. And customs and border protection says in a statement, "Utilizing technology on the border is critical but continued and repeated delays in SBI Net raise fundamental questions about SBI Net's viability. Americans need proven, cost-effective border security solutions." Now, they say, not ten years down the road.

MALVEAUX: Still a work in progress.

MESERVE: Very much a work in progress and a lot of critics particularly on Capitol Hill.

MALVEAUX: Thank you, Jeanne.

MESERVE: You bet.

MALVEAUX: We're seeing new anger in Arizona in response to the judge's ruling blocking parts of the state's immigration law. Arizona's two Republican Senators John McCain and Jon Kyl issued this statement. "We are deeply disappointed in the court's ruling today and disagree with the court's opinion that the Arizona law will unduly burden the enforcement of federal immigration law. Instead of wasting taxpayer resources filing a lawsuit against Arizona, and complaining that the law would be burdensome, the Obama administration should have focused its efforts on working with Congress to provide the necessary resources to support the state in its efforts to act where the federal government has failed to take responsibility." President Obama says that he is eager to sign a national immigration reform law but he also contends that Republicans aren't cooperating.

OBAMA: I'm ready to move forward. The majority of Democrats are ready to move forward. And I believe the majority of Americans are ready to move forward. But the fact is without bipartisan support as we had just a few years ago, we cannot solve this problem.

MALVEAUX: Our senior political analyst Gloria Borger is joining us now. We've been talking about this over the last several days or so because such a controversial and emotional issue for so many people. We saw President Bush time and time again try to push comprehensive immigration reform. It just didn't work. People wanted to focus or at least the critics, a lot of Republicans wanted to focus on the border.

GLORIA BORGER, CNN SENIOR POLITICAL ANALYST: Right.

MALVEAUX: We think that President Obama is going to make any more headway?

BORGER: No.

MALVEAUX: Than President Bush did on this issue?

BORGER: Sad to say, absolutely not. Not in the short term at least. We don't know what's going to happen in the long term but, you know, this is an issue, Suzanne, that divides every party. It's not just the Republicans fighting the Democrats. Everybody within each party has a different way to proceed. We saw in the Democratic Party, you heard President Obama saying yes he wants immigration reform. Senator Harry Reid the majority leader said, okay. I want to do immigration reform but he is from the state of Nevada. That's good for him in his re-election fight to be able to say that. There are lots of Democrats particularly in the house if you're say from North Carolina, why do you want to touch immigration reform now? That's not an issue you need in order to win your house race. And Republicans? You talk about a path to citizenship? You mentioned Senator John McCain? It wasn't so long ago that he was with George W. Bush and Ted Kennedy and he's changed now. He is in a very tough fight in Arizona and what he learned and I've spoken with him about this, what he learned when he campaigned for president and said I'm for immigration reform was that people really want to secure the border first. And in the Republican Party if you talk about a path to citizenship, lots of folks say that means amnesty for illegal immigrants. They don't want it.

MALVEAUX: President Obama is trying to split the difference. We've seen him increase the number of border patrols.

BORGER: Right.

MALVEAUX: He has reached out to the governor of Arizona. He is trying to say, and we have seen more of those deportations than we saw under President Bush.

BORGER: Right.

MALVEAUX: So what can he do? He almost seems kind of stuck at this point.

BORGER: Right. Actually on August 1st he is beefing up security, 1200 more National Guard troops down there. They've got more money. They're spending more money than George W. Bush did. But at this point, anybody who talks about immigration reform is going to have a target on his back because it's a very, very tough political issue. And it is such an easy issue to demagogue, particularly right now when we've got high unemployment in this country. You know, the American public wants a reasonable solution. They just believe that the lawmakers have not been paying attention to the problem of securing the border so they want to get that done first.

MALVEAUX: Gloria, the folks at the white house who I talked to, they're not popping the champagne corks but they feel in part this has avoided a disaster in the state of Arizona. Could this somehow play in Republicans' favor, this ruling?

BORGER: I've been talking to Republicans today. Obviously they'd rather have had the ruling go their way. It did not. They say what it is going to do is get out the Republican base in the short term and mid term elections and reinforce the notion that President Obama is disdainful of public opinion and that he's disdainful of letting the states do what they feel they need to do so in the short term as one Republican said to me, it's only going to be more Washington knows best and that doesn't work well for the Democratic party. It works in getting out the Republican faithful.

MALVEAUX: All right. We'll see how this all plays out in the weeks ahead. Thank you.

BORGER: Sure.

MALVEAUX: It is the worst plane disaster in one country's history. We'll have the latest on the crash and the casualties.

Also, will Congressman Charlie Rangel cut a deal before ethics charges against him are unveiled? Time is running out.

And the list of the 50 most beautiful people on Capitol Hill. That's out. We're naming some names.

(COMMERCIAL BREAK) MALVEAUX: Lisa Sylvester is monitoring some of the other top stories coming into THE SITUATION ROOM right now. Hey, Lisa. What are you working on?

LISA SYLVESTER, CNN CORRESPONDENT: Hi, Suzanne. The worst plane crash in Pakistan's history has killed all 152 people onboard. The jet was coming in for a landing this morning during a severe storm. It slammed into a hill side just outside Islamabad, broke into pieces, and caught fire. Two passengers aboard the flight were American.

And a bold step in Spain as Catalonia becomes the first region to ban bull fighting. Its parliament voted today to outlaw the centuries old tradition because it is cruel to animals. The law goes into effect in 2012. Some bull fighting supporters fear the ban will cause a drop in tourism.

And the hottest names in Washington are out as the newspaper "The Hill" identifies this year's 50 most beautiful people. Six members of Congress make the cut and number three is New York Senator Kristen Gillibrand. There she is. She lost 40 pounds since taking over for Hillary Clinton. Also on the list, California Representative Judy Chu, she is number seven. And the first Chinese American woman elected to Congress. And not surprisingly, Massachusetts Senator Scott Brown, he is also on the list but actually he didn't score as high as fitness buff and Congressman Jesse Jackson Jr. who you see there. So a lot of -- I was just looking it up online. A lot of interesting names, Suzanne.

MALVEAUX: Lisa, they only had one journalist who made the list but I bet you if they opened up the field you'd be at the top of it.

SYLVESTER: You know, it's clearly people on the hill but I would think your name should be up there, Suzanne.

MALVEAUX: We'll have to lobby. You know? Let's open up the list a little bit here. See if we can make it next year. Thank you, Lisa.

Democrats are trying out a new tactic equating the tea party movement with the Republican Party. But is that going to work? Donna Brazile and Tony Blankley are standing by.

Plus, the search for Iraq's missing billions. That's right billions. Why can't the pentagon find the money that it was entrusted to keep?

(COMMERCIAL BREAK)

MALVEAUX: With mid term elections coming up Democrats are trying a new tactic against Republicans equating the GOP and the tea party movement. Here to talk about that and much, much more are CNN political contributor and Democratic strategist Donna Brazile and Republican strategist Tony Blankley a former spokesman for Newt Gingrich. Thanks for joining us here on THE SITUATION ROOM. It is an interesting concept, idea strategy by the Democrats to equate and to marry the two, the tea party movement as well as Republican Party. This is what the DNC's new ad is promoting. What do you make of that? I mean, is that convincing, Donna, that you have those slogans and, I mean, obviously the tea party very much against government intervention and taxes and that type of thing but does it really represent the Republicans in general?

DONNA BRAZILE, DEMOCRATIC STRATEGIST: Well, we know what they're against because they've gone public and said they want to repeal social security, want to privatize social security, repeal Medicare. They want to repeal the health care bill, repeal Wall Street reform, so I think this ad is designed to educate the American people about the Republican Party agenda. Last week they convened the tea party caucus and the Congress, 46 members including some of the leaders of the Republican Party, and so I think this is an opportunity for the Democrats to finally define the Republicans.

TONY BLANKLEY, HERITAGE FOUNDATION: Well, I hope that they spend like $50 million nationally on this. This is obviously an ad I assume of minimal buy in D.C. and a video press release but the fact is it's wrong. And it's wrong and it'll be seen to be wrong by the viewers because according to the Gallup poll which I have here 49 percent of tea parties are identified as Republican, 43 as independent, 8 as Democrat. So a slight majority, 51 percent by Gallup. Other polls it's been as high as 55 or 57 percent identify as Republican. And the other part, 40 percent to 50 percent don't. So if you are watching, if you are a tea party member and watching this and you are one of those independent tea party members and you see an ad from the DNC saying I'm a Republican, you say I'm an independent, it doesn't click true to the viewers. I don't think it is terribly -- the ominous music. Interesting point they are now giving the Republicans an agenda. Until a few weeks ago they are the party of no. Now they have a new contract according to this. But the fact is that saying party of no was not working well for the Ds because the country is saying no to what is going on in Washington so they switched to say Republicans have their own agenda and it's a bad one. I don't think it's going to work.

BRAZILE: This election this fall is a choice between going back to the past or going back to the policies that led the country off this economic cliff or going forward with policies that will help spur economic growth.

MALVEAUX: Is it fair to lump all the Republicans in with the tea party? That seems to be the most extreme element.

BRAZILE: No, I think it's the most energized element of the Republican Party. You agree with the tea party leaders and the Republicans that we should repeal the health care bill.

BLANKLEY: I certainly do as do 60 percent of the public.

BRAZILE: No that number is changed. Most Americans would like to see this bill implemented in such a way that will lower their costs and ensure we don't discriminate against people with pre-existing conditions.

BLANKLEY: I just give one bit of advice to the Democrats. Never believe your own propaganda when designing your own communications. 60 percent of the nation wants to repeal health care. If you don't believe that, spend money telling people that the Republicans want to repeal health care and they're going to get more support.

BRAZILE: So you agree with the ad that you all want to repeal health care and Wall Street reform? And you want to privatize social security.

BLANKLEY: You're asking me personally. The party doesn't have a position as you know. The party doesn't have an agenda.

MALVEAUX: I want to go to the next subject here.

BRAZILE: He just said the party doesn't have an agenda.

BLANKLEY: Of course it will, it is a fine agenda f or the next few months.

MALVEAUX: Let's talk about Massachusetts and what is happening because it is interesting, and they are moving to bypass the electoral process system by which we elect the president. We spent a lot of time as you know, you know, counting chads and hanging chads and President Bush became president because of the Electoral College process, and everyone learned what it was. Now you've got Massachusetts that says no we want the national popular vote to decide who becomes popular, and does this pick up steam?

This is funny. If that ruled applied to Massachusetts the electoral votes would have gone twice for Reagan and once for George Herbert Walker Bush, because the only time in the century that the majority vote has not gone to the electoral was 2000. What you will get, and this is deranged, because what you will get and every vote in the country works, you will have a 50-state recount, because normally, if you lose in the state, and say the Republicans lose New York state 60- 40, we don't ask for a recount, because we won't pick up 20 percent, but we might pick up 3 percent. And Florida times 50 forever.

MALVEAUX: Donna, you were in the middle of this, and what do you think of the idea?

BRAZILE: Well, I think that this is an idea that has happened in New Jersey and Maryland and Illinois and Hawaii who have also voted for this proposal and that is 73 electoral votes. This initiative will not gain enough steam until the states that could total 270 electoral votes will come up to make the difference. How do I feel about it personally? Look, I know a wrong was done in 2000, and on that, but I d believe that the voters out there deserve an opportunity to have people voting out there to say who is in the white house.

MALVEAUX: We will leave it there. All right. I know Tony you're dying to say something. Donna, thank you so much.

BRAZILE: Thank you.

MALVEAUX: Well, it is the big mystery of the disaster in the gulf. Where did all of the oil go? Two experts are standing by to explain what happened, and whether there is still a threat that we cannot see.

And parting shots of those Russians who were sent back home in a spy swap.

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MALVEAUX: He is facing the first house ethics trial in a decade, and Congressman Charlie Rangel has not been saying much about it, but a few hours ago he did seem to allude to his problems in a speech.

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REP. CHARLES RANGEL (D), NEW YORK: We can't give up. We can't give out. We can't give in. All I can promise you is that, when the sun shines and everything is settled we will once again be standing together with dignity and honor to complete our jobs for our communities and for these great United States.

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MALVEAUX: I want to bring in our CNN Congressional correspondent Brianna Keilar, and Brianna to clarify in the beginning, you are in a very important place and important room, but do we have any idea if there are developments regarding Congressman Rangel, a deal or a settlement at this point?

BRIANNA KEILAR, CNN CONGRESSIONAL CORRESPONDENT: Well, we know, Suzanne, that his lawyers are talking to the Ethics Committee lawyers, that negotiations are ongoing but so far they have not come to an agreement at least they haven't said publicly and if they don't come to a settlement, this is where things are going to play out tomorrow. This is a large hearing room for the house where it will be basically if this were criminal proceedings, it would be an arraignment going through the publicly the alleged violations that Rangel is facing. Let me tell you what we are going to be looking at. We are expecting that one Democrat, one Republican on the ethics committee will be sitting we are expecting here and they will be presiding over this process as if they are really judges, presiding over this process. They are going to be surrounded by another eight members of the ethics committee also Democrats and Republicans, and in this whole hearing, they are going to be serving essentially as jurors if this process moves forward. But this is where we are going to be hearing the substance coming from. One Democrat, one Republican, who have been involved in the almost two-year investigation of Rangel, an investigation that gives this committee reason to believe substantial reason that Rangel has violated some ethics standards, and they are going to be detailing the alleged violations that he has committed and at the same time that the process going on, Suzanne, there is going to be a report released that really goes into this in details, pages and pages, so that we will get a very clear detailed look at this. So where is Charlie Rangel going to be in all of this? Well, he does not actually have to be here, but from what we has been telling the reporters for the last few days, we are expecting he will be here and that will certainly add to the drama, Suzanne.

MALVEAUX: So, what do we expect after if the hearing takes place tomorrow, and they publicly air what some of the complaints are, what happens after that? Does -- is the job in jeopardy or what do we expect? KEILAR: Potentially, the next step is the equivalent of a trial that would play out. We would suspect that would start perhaps late August, maybe in September but it plays up very much like a trial. You would expect that Rangel's lawyers would serve as the defense and the ethics committee lawyers would serve as the prosecution. They would both make their cases, and then -- Suzanne?

MALVEAUX: Okay. All right. Thank you, Brianna. We will see how it plays out, and please let us know if there is something else that develops in the next couple of hours.

Our correspondents are fanned out in Arizona covering that new ruling blocking parts of the state's controversial immigration law, and HLN's Joy Behar will join us with the inside story on President Obama's chat with the ladies of "The View."

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