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THE SITUATION ROOM

Day of Protest Across the Country; Plans for Iran?; Generals Vs. Rumsfeld

Aired April 10, 2006 - 16:59   ET

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


WOLF BLITZER, CNN ANCHOR: And to our viewers, you're in THE SITUATION ROOM, where new pictures and information from around the world are arriving all the time.
Standing by, CNN reporters across the United States and around the world to bring you today's top stories.

Happening now, it's 5:00 p.m. in Washington, one of some 70 cities across the country where tens of thousands, perhaps hundreds of thousands of people are taking part in a day of protests. They're calling for fair immigration reform and denouncing efforts to criminalize illegal immigration.

It's 5:00 p.m. over at the White House, facing questions about a leak authorized by the president himself. It's the latest twist in the CIA leak investigation. Who revealed the name of CIA operative Valerie Plame-Wilson? Her husband, Ambassador Joe Wilson, standing by to join us live here in THE SITUATION ROOM.

And it's 5:00 p.m. over at the Pentagon, where the defense secretary coming under friendly fire. Former top generals, retired, all of them, calling on Donald Rumsfeld to resign.

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

Across the country a day of protests. Tens of thousands, hundreds of thousands of people in dozens of cities from coast to coast taking part of what's being called a National Day of Action for Immigration Justice.

Our reporters are covering every angle of this story.

CNN's Chris Lawrence is in Los Angeles. Mary Snow is in New York. But we begin with our Ione Molinare of CNN en Espanol. She's joining us from the Washington Mall.

Ione, what's going on behind you?

IONE MOLINARE, CNN EN ESPANOL CORRESPONDENT: Wolf, tens of thousands have been gathering here at the National Mall, an event being organized by religious groups, also some civil rights organizations, and also Latino leaders, local Latino leaders. And the local media has played a big role on gathering and passing the information around so they can get people as far as Delaware bringing their bosses and bringing their own transportation and gathering with their families. And not only illegal immigrants, also permanent residents, citizens, and all sorts of immigrants, mainly for the Latino community, that have been gathering here at the National Mall.

And also, the same communities have been passing the word around, they're coming here to reject the bill that was passed by the House in December, and they're looking for a way that the Senate might be able to look for some sort of legalization for millions of (INAUDIBLE) look for a way to be able to be treated as a citizen, as a regular American citizen.

So it's been a very interesting gathering here. A lot of people are very hopeful that the Senate might come up with some sort of legalization. And also, they're coming here to reject and say that the bill passed by the House is sort of a racist bill and it doesn't honor what is really the American values -- Wolf.

BLITZER: Ione, thank you very much.

Ione Molinare of our CNN en Espanol.

Thank you.

It's not just major U.S. cities seeing those protests today. Some of the demonstrations are playing out in places you might not necessarily associate with immigration; namely, a city like Garden City, Kansas; or another city like Columbia, South Carolina; and Jackson, Mississippi, as well. In all, about 70 protests expected before the day ends today.

We'll get more on that immigration story coming up throughout this hour, but there's important news that we're following.

To stop Iran from building nuclear weapons, is the United States inclined to use diplomacy or is it inclined to use a weapon? Is it inclined it use a nuclear weapon?

Investigative journalist Seymour Hersh of "The New Yorker" magazine says the United States is considering several military options to curb Iran's nuclear ambitions, including using nuclear bombs to blast Iran's underground bunkers. Today, President Bush did not exactly deny -- actually deny the claim, but he did say this -- listen to this.

(BEGIN VIDEO CLIP)

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: The doctrine of prevention is to work together prevent the Iranians from having a nuclear weapon. I know here in Washington, you know, prevention means force. It doesn't mean force, necessarily. In this case, it means diplomacy.

And by the way, I read the articles in the newspapers this weekend. There was just wild speculation, by the way. What you're reading is wild speculation, which is -- it's kind of a -- you know, it happens quite frequently here in the nation's capital.

(END VIDEO CLIP)

BLITZER: More now from our Pentagon correspondent, Barbara Starr -- Barbara.

BARBARA STARR, CNN PENTAGON CORRESPONDENT: Well, Wolf, Pentagon officials are adamant that contingency planning for Iran is just that, routine contingency planning. They say the path ahead, indeed, remains diplomacy to try to convince Iran to give up its nuclear programs.

(BEGIN VIDEOTAPE)

STARR (voice over): A strike against Iran's nuclear facilities -- some are deep underground -- would be extraordinarily difficult, current and former U.S. military officials tell CNN. Pentagon sources say a "New Yorker" article by Seymour Hersh that planning for a strike has been stepped is simply not true. Experts with knowledge of Iran say there may be dozens of nuclear sites and detailed information on only a handful of locations.

One key target, the nuclear enrichment facility near Natanz, south of Tehran. By some calculations, it could provide enriched uranium for about 20 nuclear warheads a year. But key parts of it are buried under layers of concrete and dirt designed to withstand bombing by conventional weapons. And the current inventory of U.S. tactical nuclear bombs cannot penetrate deep enough to destroy the target without nuclear fallout.

GEN. ANTHONY ZINNI (RET.), FMR. CENTCOM COMMANDER: There's always a problem with getting deeply-buried targets, and it's difficult to get the kind of penetration if they're hardened and extremely deep.

STARR: And the resulting political and security fallout from a U.S. attack could be catastrophic.

ZINNI: I think, first of all, you have to understand that Iran may not just take the strikes and roll over.

STARR: Military officials say there is great concern that Hezbollah or al Qaeda could unleash terrorist attacks around the world. U.S. troops in next-door Iraq would also be at risk.

(END VIDEOTAPE)

STARR: And Wolf, one targeting expert estimates it could take as many as 400 bombs to destroy Iran's nuclear program. And that, of course, would only be the beginning of any U.S. effort to take down the regime in Tehran -- Wolf.

BLITZER: Barbara, thank you very much for that.

They are military generals, and their taking on the defense secretary. Their general message is this: Donald Rumsfeld must go. Some high-ranking members of the U.S. military retired are voicing candid thoughts about the man they once worked for and with.

Let's bring in our Brian Todd. He's in the newsroom with more -- Brian. BRIAN TODD, CNN CORRESPONDENT: Wolf, military experts say it's important to make that very distinction, that these are retired officers, not active duty. But it's their prominence that's raising eyebrows.

(BEGIN VIDEOTAPE)

TODD (voice over): Backlash from former top brass and new calls for Donald Rumsfeld to resign. Retired Marine General Gregory Newbold, assigned to the Joint Chiefs before the Iraq invasion, writes in "TIME" magazine that the decision to go to war "... was done with a casualness and swagger that are the special province of those who have never had to execute these missions or bury the results."

Newbold calls for Rumsfeld's departure, becoming the third prominent retired general in as many weeks to do so.

ZINNI: We made a series of bad decisions. Bad decisions in terms of disbanding the Army, letting the de-Ba'athification go too far, not having a process of reconciliation.

TODD: And General Anthony Zinni, former commander of U.S. Central Command, joins others who says Rumsfeld ignored advice on the number of troops needed to stabilize Iraq.

MAJ. GEN. PAUL EATON, U.S. ARMY (RET.): They didn't have enough soldiers to do the missions that they had. They were undermanned for -- for the so-called phase four.

TODD: That's General Paul Eaton, once in charge of postwar training for the Iraqi military who later called Rumsfeld incompetent. But the White House is unwavering.

SCOTT MCCLELLAN, WHITE HOUSE PRESS SECRETARY: The president has great appreciation for the outstanding job he's doing.

TODD: CNN analyst David Grange, a retired general who knows Eaton and Zinni, says it's unusual for three senior retired officers to speak out in a short time span.

GEN. DAVID GRANGE, U.S. ARMY (RET.): I think there is maybe some growing dissent within some of the officer corps, but again, it's retired people. Of course, when they're retired, then they will speak publicly. When they're in this service, they'll talk behind closed doors.

(END VIDEOTAPE)

TODD: Secretary Rumsfeld's press office would not comment to this criticism today. But one top Pentagon official points out to CNN that many retired generals do support Rumsfeld. And general Grange says he doesn't think those three generals, prominent as they are, represent the majority in the officer corps -- Wolf.

BLITZER: Brian, thank you very much for that.

Let's check in with our own Jack Cafferty once again. He's in New York. He's got "The Cafferty File" -- Jack.

JACK CAFFERTY, CNN ANCHOR: Another day, another surprise. Some students, public school students, will get school credit for attending today's immigration rally in our nation's capital. That's correct.

One Maryland high school district is giving students credit toward the state's community service graduation requirement if they participate in the rally and are supervised by an approved community group. The Montgomery County superintendent says the decision is consistent with the school system's previous policy, but some parents and activists say that education, not political advocacy, should be the school's main focus.

Some say the school system is allowing one of the organizing groups behind the rally to push its political agenda on to the students. School offices were flooded with angry phone calls last week.

So, here is the question: Should students get school credit for attending an immigration rally? No.

E-mail us at caffertyfile@CNN.com or go to CNN.com/caffertyfile.

I was just answering the question on behalf of my four daughters -- no.

BLITZER: You want them to get credit if they take algebra. Is that right?

CAFFERTY: Yes, exactly. Let's learn how to read and write, do the multiplication tables, and we can save the street demonstrations for later.

BLITZER: Now, this isn't credit to graduate. It's -- in Montgomery County -- and I live in Montgomery County -- you get community service. You need to do a certain number of hours in order to qualify for graduation. This is not the academic requirements. It's a community service.

CAFFERTY: No, no. I understand. My question is, what exactly -- what service are you doing for your community by running around through the streets carrying Mexican flags and advocating on behalf of people who are breaking this nation's laws? That would be my question.

BLITZER: All right. Well, we'll see what our viewers think, Jack. Thanks very much for that.

CAFFERTY: OK.

BLITZER: Up ahead, Democrats uniting to take advantage of the Republican divide over immigration. Senator Hillary Clinton among those speaking out today. We're going to have details of what she is saying.

Also, the president answers critics over the leak of previously classified intelligence on Iraq. It's the latest twist in the CIA leak investigation.

And this: his wife is the former CIA operative at the center of the entire CIA leak case. The former United States ambassador, Joe Wilson, he's standing by to join us live here in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: The White House is once again under a spotlight stemming from the CIA leak investigation, and this time the president himself is implicated, although not necessarily of breaking the law. It's the latest development in a case that started when the name of the undercover CIA operative Valerie Plame-Wilson was leaked to reporters after her husband, retired U.S. Ambassador Joe Wilson, criticized White House assertions about Iraq's attempts to buy uranium.

Joe Wilson is standing by to join us live here in THE SITUATION ROOM, but let's go to the White House first. Our correspondent, Suzanne Malveaux, has more -- Suzanne.

SUZANNE MALVEAUX, CNN WHITE HOUSE CORRESPONDENT: Well, Wolf, today really was the first time that President Bush spoke out publicly regarding his role in the CIA leak case, this controversial case that first came to light last week. President Bush, at Johns Hopkins University, taking some questions and answers, of course, from students, making no apologies and taking his critics head on.

(BEGIN VIDEOTAPE)

MALVEAUX (voice over): President Bush insists he did not leak classified information to justify his rationale for the Iraq war. Instead, he just declassified it.

BUSH: You're not supposed to talk about classified information. And so, I declassified the document.

MALVEAUX: That document was the October 2002 national intelligence estimate, or NIE, which supported Mr. Bush's claim that Iraq was trying to obtain weapons of mass destruction. Mr. Bush cleared the NIE for public consumption as he is legally authorized to do several months after the U.S. invaded Iraq, but failed to find weapons of mass destruction. It was part of a top-level campaign to discredit his critics who were accusing him of twisting Iraqi intelligence to justify the war.

BUSH: I decided to declassify the NIE for a reason. I wanted people to see the truth.

MALVEAUX: Court documents in the trial of top Cheney aide Scooter Libby showed that the White House was particularly irked by former Ambassador Joe Wilson's challenges to the administration that Iraq sought nuclear weapons. So the president's public defense of the war was no longer enough.

BUSH: I thought it was important for people to get a better sense for why I was saying what I was saying in my speeches. And I felt I could do so without jeopardizing, you know, ongoing intelligence matters. And so I did.

MALVEAUX: What the president did, the White House maintains, was disclose information that was previously classified, not leaked.

BUSH: There are too many leaks of classified information in Washington.

MALVEAUX: But Democrats say the president is being hypocritical in parsing his words. Political analysts say that strategy failed former president Bill Clinton during the Monica Lewinsky affair.

WILLIAM JEFFERSON CLINTON, FMR. PRESIDENT OF THE UNITED STATES: It depends upon what the meaning of the word "is" is.

DAVID GERGEN, FMR. PRESIDENTIAL ADVISER I think that does not wash with the general public.

(END VIDEOTAPE)

MALVEAUX: And Wolf, at least now one Republican senator, Arlen Specter, has gone along with Democrats in calling for the president to give a fuller explanation -- Wolf.

BLITZER: Suzanne at the White House.

Thanks very much.

The former United States ambassador, Joe Wilson, is here in THE SITUATION ROOM to talk about these latest developments.

Mr. Ambassador, welcome back to THE SITUATION ROOM.

JOSEPH WILSON, FMR. U.S. AMBASSADOR: Good to be with you.

BLITZER: What do you think of the president's explanations?

WILSON: Well, let me just correct one part of that package, first of all. The full body of the NIE, the national intelligence estimate, had it been released, would have demonstrated, as has been reported over the weekend, that, in fact, a good part of the intelligence community, intelligence community management felt that the allegation that Saddam had purchased, tried to purchase uranium from Africa was baseless. And indeed, there's recently been the leak of a national intelligence officer report that was done three weeks before the State of the Union Address which uses that term, this allegation is baseless.

So, it's important to understand that the full NIE would have demonstrated the accuracy of the report that I filed and the article I wrote in "The New York Times". Now...

BLITZER: But there was a debate, though, among analysts over the British assertion, British intelligence that the Iraqis were seeking enriched uranium from Niger.

WILSON: If you look at... BLITZER: Because the British apparently still believe that.

WILSON: Sure. And the British really, if they do still believe it, have an obligation to share that information with the International Atomic Energy Agency, as is called for in U.N. Security Council Resolution 1441. But, in fact, in October of 2002, almost four months before the State of the Union Address, the Senate Select Committee on Intelligence itself was told by the deputy director of Central Intelligence that the judgment of the American intelligence community was that the British had stretched the case, and within four days the director of Central Intelligence had communicated at the White House three times.

BLITZER: They later acknowledged, even the White House.

WILSON: Right. So let's be very clear on this.

BLITZER: Those 16 words that the president used in his State of the Union Address should not have been...

(CROSSTALK)

WILSON: And indeed, they acknowledged that the day after my article appeared, which should have been the end of it. It should have been the end of any engagement and involvement of Joe Wilson. It certainly shouldn't have gone to the involvement of my wife in this.

But getting to the president's statement...

BLITZER: Before -- well, go ahead and respond to the president's statement.

WILSON: Well, I have -- I would like -- I believe, in fact, that -- that it is probably in the interest of the American public, and certainly I think it's in the interest of the president and the vice president to be very direct with the American people exactly what happened during that time frame. My view is that they should probably release the White House transcripts of their testimony to Mr. Fitzgerald. There's a precedent for doing that, and I would fully expect that the White House transcripts of their conversations with Mr. Fitzgerald would make very clear...

BLITZER: I've asked that. I've asked people, why wouldn't they do that? They argue this is in the middle of legal proceedings right now and maybe when Scooter Libby and all the other legal matters that Patrick Fitzgerald, the special prosecutor, is investigating have been resolved, at that point for the historic record they would do so. But it would be inappropriate to start releasing the kind of testimony you want released while the proceedings are still under way in advance of the trial...

WILSON: By the way.

BLITZER: ... that's supposed to begin in January.

WILSON: By the way, not just me. I think it was Senator Specter who first...

BLITZER: But Senator Specter said the president should give a fuller explanation, the vice president should give a fuller explanation. They didn't say -- he didn't say that -- what you're saying, that they should release the actual transcripts of their testimony.

WILSON: And the fullest possible explanation would be the transcripts...

BLITZER: But that would be OK with you, if they just came out and gave a full explanation without releasing the transcripts?

WILSON: I'd like to see the White House transcripts, but I would certainly like to see a fuller explanation. But I think the White House transcripts are -- would be of some use to the American public, and there is precedent for this.

Vice President Gore released the transcripts of his conversation with the special prosecutor in 2000, for example. And, indeed...

BLITZER: On which issue?

WILSON: I think it was probably the Buddhist temple issue, but you can go back and take a look at it.

BLITZER: But that issue had been resolved, right, after...

WILSON: No, I think it was after he gave his testimony, actually.

BLITZER: Even while it was under -- all right.

Listen to what Senator Jon Kyl, Republican of Arizona told me yesterday involving you. Listen to this.

(BEGIN VIDEO CLIP)

SEN. JON KYL (R), ARIZONA: The Wilson piece that appeared in the newspaper provided some of, but not all of the information and created a distorted picture. And so, they recognized that they needed to get some of the information declassified so that the full picture could emerge.

(END VIDEO CLIP)

BLITZER: The argument being, and you've heard this, that you were criticizing them, so the natural reaction for Scooter Libby and others in the White House is to rebut, to respond to the criticism.

WILSON: Which is absolutely fine. And indeed, I would have loved it if they had, in fact, declassified the entire national intelligence estimate and put it out there.

BLITZER: They never declassified the whole thing. They declassified a big chunk of it, but never the whole thing. WILSON: They leaked selective parts of it. Page 24, which happened to contain the information which was misleading about the allegation, and which was rebutted in the appendix, and, which, by the way, was not part of the key judgments. When Mr. Libby spoke to Ms. Miller, according to testimony, he said that one of the key judgments was this allegation. In fact, it was not.

BLITZER: Scott McClellan, White House...

WILSON: Now, with respect to Jon Kyl, by the way...

BLITZER: All right. Go ahead.

WILSON: ... he knows very well because he is the one who asks the question in the Senate Select Committee on intelligence briefing.

BLITZER: He was a member.

WILSON: He was the person who asked the deputy director of Central Intelligence about the allegation that Saddam had attempted to purchase uranium from Africa four months before the State of the Union Address. And it was to him that the response was, we believe the British have stretched the case beyond where we would stretch it.

BLITZER: What he said to me yesterday was that they couldn't confirm it, was the way that they sort of phrased it to him.

WILSON: Well, that's not the way the Senate Select Committee on Intelligence report reads.

BLITZER: Well, let's -- let me get you also to respond to what the White House press secretary, Scott McClellan, said on Friday.

Listen to this.

(BEGIN VIDEO CLIP)

SCOTT MCCLELLAN, WHITE HOUSE PRESS SECRETARY: There were people that were out there making irresponsible accusations that intelligence was manipulated or that intelligence was misused. There's been no evidence to back that up, whatsoever.

(END VIDEO CLIP)

BLITZER: All right. You're smirking, you're laughing.

WILSON: No, I'm not smirking. I'm really rather saddened by all this, because after all, everything that has come out, all the reporting over the weekend, where people finally did go in and dig into the NIE, makes...

BLITZER: The story in "The Washington Post."

WILSON: "The Washington Post" and "The New York Times" make abundantly clear that, in fact, there was nothing to sustain this allegation. And, in fact, the White House and the Senate knew it weeks before the president's State of the Union Address. And it is very sad to think that indeed there was the twisting of intelligence to support political decisions to take this country to war.

BLITZER: I want you to stick around. I want to take a quick break, but we have more questions to ask you.

The retired United States ambassador, the acting ambassador to Iraq, also served as the United States ambassador in Africa. Joe Wilson is going to stick around. We've got more questions to ask him.

Also coming up, Senator Hillary Clinton weighs in on immigration rallies as they unfold across the country. We're going to have details of what the possible Democratic presidential contender is saying.

Also, is a convicted felon preparing your taxes? Our Internet reporters have some new information warning of potential tax trouble.

All that coming up. Stay with us.

(COMMERCIAL BREAK)

BLITZER: Welcome back. We're continuing our conversation with the retired United States ambassador Joe Wilson.

Do you believe based on everything you know right now that the president or the vice president directly had a role in outing the name of your wife, Valerie Plame-Wilson, as an undercover CIA operative?

WILSON: I have -- I have no knowledge of that one way or the other. I'm as curious as everybody else is. Perhaps more curious since it is my wife and since it's very clear from the filings of what happened to us was part of a concerted effort to besmirch my good name and my wife's reputation and damage her career.

BLITZER: It was clear in the document that was released last week that there was a plot, a plan, whatever you want to call it, to rebut you and to go after you to undermine your credibility. But there was no assertion...

WILSON: Oh, I think it's more than that. I think if you read the filing it's very clear that there was a concerted effort to -- to engage in character assassination.

BLITZER: But that stopped short...

WILSON: This was not hardball.

BLITZER: Right. But...

WILSON: This was not hardball. This was spitball politics.

BLITZER: But it stopped short of actually making the assertion that there was a concerted effort to release the name of your wife, who was a clandestine officer. WILSON: Well, it certainly makes the case that my wife was a classified officer and, therefore, the leak of her name is a violation of national security. Whether that can be prosecuted and other relevant acts, I have no idea. But at a minimum, it's a violation of national security. There are administrative procedures for that.

BLITZER: But Patrick Fitzgerald is not going after that. He's going after the -- he's simply investigating, at least based on what he's charged so far, that Lewis "Scooter" Libby lied.

WILSON: Well, Mr. Fitzgerald has made it very clear and made it very clear in his press conference two things. One, justice would be served so long as somebody was prosecuted for a crime. And second, he made it very clear that the fact that Mr. Libby had perjured himself and had obstructed justice in the view of the special prosecutor, that had stymied his effort, really, to get to the bottom of the organic crime that he was -- that he was looking in to. But irrespective of whether he prosecutes on the crime, it's important to understand that if you're a classified officer -- and Mr. Fitzgerald has said that repeatedly, that Valerie was -- then the leaking of her name is a violation of the national security.

BLITZER: But why wouldn't somebody be prosecuted for that?

WILSON: Well, again, there may well be administrative sanctions. I think it's very clear if you look at the tact that Mr. Fitzgerald is taking, he's narrowing his prosecution of Mr. Libby to what -- what is, I think, prosecutable under the circumstances. And you can see some of the circumstances that he's trying to avoid by Mr. Libby's defense and the so-called (INAUDIBLE) strategy.

BLITZER: In the paper that he filed last week, Patrick Fitzgerald, he said he was not planning on calling Karl Rove, the deputy White House chief of staff, the top political adviser to the president, as a witness in the upcoming trial.

This is what you said almost three years ago about Karl Rove. You said, "At the end of the day, it's of keen interest to me to see whether or not we can get Karl Rove frog-marched out of the White House in handcuffs."

What's your latest thinking on Karl Rove, the fact that he's not being called as a witness, at least not yet, the fact that he hasn't been charged with any wrongdoing, at least so far?

WILSON: Well, it is now clear that Mr. Rove was the source of Valerie's identity to Matthew Cooper, the "TIME" magazine reporter. And he was apparently the secondary source to Mr. Novak.

That puts him in violation of the strictures against violating the national security of the country, leaking information.

BLITZER: So why isn't he being prosecuted?

WILSON: The question for me -- again, there are many different levels that you can go to punish security violations. Security violations do occur, and they are generally punished. What is appalling to me, of course, is that we now know that this fellow leaked and that he leaked classified material, and nothing has happened to him. There are administrative sanctions. I, for one, cannot understand how the president keeps him on his staff and how he continues to maintain his security clearance in the face of, really, evident and testimony that he compromised a classified officer's identity.

BLITZER: You still want to see him frog-marched out of the White House in handcuffs?

WILSON: I think that's appropriate, but as I said a long time ago, I'd be happy to have the handcuffs off, just have him frog- marched out of the White House. I cannot understand how the president of the United States would keep on his senior staff somebody who was so cavalier with the national security of my country.

BLITZER: Your wife, Valerie Plame Wilson, has retired, has left the CIA. What is she doing?

WILSON: Well, as we've got 6-year-old twins and, of course, that's a full-time job raising them. And she's considering what her other options are as we go through life.

BLITZER: What other options, in terms of careers or lawsuits?

WILSON: Well, we've not made any decisions on civil suits. We're waiting to see how this plays out. Every week there's a new filing. Every week he gets more interesting. With respect to her career choices, I think she has many, and she's taking a look at all of them.

BLITZER: Ambassador Joe Wilson, thanks very much for joining us.

WILSON: Good to be with you, Wolf.

Coming up, he's a Republican governor, a largely Democratic state, and he's an immigrant himself, so where does Arnold Schwarzenegger stand on the immigration debate?

Plus, the price of gas spiking in recent days. We're going to show you what is behind the latest surge of pain at the pump. Ali Velshi has the bottom line. Stay with us.

(COMMERCIAL BREAK)

BLITZER: More now on our top story. Thousands of people across the United States demonstrating on what's been dubbed a national day of action for immigration justice. We're covering the rallies coast to coast.

CNN's Mary Snow is standing by live in New York. Chris Lawrence is in Los Angeles. Let's begin with Mary -- Mary.

MARY SNOW, CNN CORRESPONDENT: And, Wolf, a little competition with this crowd that is growing larger and, obviously, getting louder. Thousands here packed into lower Manhattan right outside city hall in a rally that started a couple hours ago and has continued to grow.

If you look out in the crowd, you see flags all over: American flags, flags from Puerto Rico, from Mexico, from Bangladesh. This is labor groups, also church groups have been packing this downtown area, one after another. They have heard from speakers calling for legalization. Among those speakers, New York Senator Hillary Clinton.

(BEGIN VIDEO CLIP)

SEN. HILLARY CLINTON (D), NEW YORK: I am convinced that we will have immigration reform, because it makes sense for America. But not the kind of legislation that was passed in the House, because that is not in keeping with either reality or American values.

(END VIDEO CLIP)

SNOW: The senator getting a loud round of applause. Also Senator Chuck Schumer speaking here today, Reverend Al Sharpton in this rally that is expected to go on for a few more hours -- Wolf.

BLITZER: Any estimates, Mary, how big the crowd is in New York? Are police offering any official estimate?

SNOW: There are no official estimates, but when we first got here there it was 12,000 and as several thousand more people march across the Brooklyn Bridge. Rough ballpark we would have to say about 15,000.

Now, going into this march today in this rally, some of the organizers were saying as many as 100,000 people might show up here today. So well short of what organizers had expected.

BLITZER: all right, Mary. Thank you very much. Mary Snow reporting for us.

Let's move on to Los Angeles now, scene of another large protest. Chris Lawrence is joining us live from there -- Chris.

CHRIS LAWRENCE, CNN CORRESPONDENT: Well, Wolf, some of the largest crowds and loudest voices in this protest have come from right here in L.A., where another rally is getting started in just a next few hours. So this issue of illegal immigration puts Governor Arnold Schwarzenegger in perhaps the toughest position of any politician.

(BEGIN VIDEOTAPE)

LAWRENCE (voice-over): He's the immigrant governor of a border state, a Republican in mostly Democratic California, where about one out of every three people is Hispanic.

ARNOLD STEINBERG, POLITICAL ANALYST: I think he's in a real quandary because the fact is that Republicans see this is an issue of law and order more than anything else.

LAWRENCE: Republican political strategist Arnold Steinberg is critical of Governor Schwarzenegger's balanced opinion on illegal immigration.

STEINBERG: The governor is really trying to preempt the issue by going toward the middle and being sort of a committed extreme "middlist".

LAWRENCE: In a "Wall Street Journal" editorial, the governor supports tougher enforcement of immigration laws, writing, quote, "Congress must get serious about our security" and "a stronger border means more border patrol agents, greater equipment and better resources."

But he criticizes the plan to fence off the U.S./Mexican border. Quote, "Brick walls and chain link fences will not stop the desires and dreams of a father who is desperate to feed his family. And making it a felony to cross the border crosses the line into pure politics."

STEINBERG: The fact of the matter is, he's going to have a very, very tough time because he so alienated his base within the Republican Party, that being in the middle probably isn't good enough.

LAWRENCE: To hold onto the Republican base, Steinberg says the key is not what Schwarzenegger says about illegal immigration, but what he does with the power of his office.

STEINBERG: He got into office by opposing giving driver's licenses to illegal aliens or undocumented aliens there. When that Bill comes before him again, will he sign it or veto it?

(END VIDEOTAPE)

LAWRENCE: I asked that same question to the governor's office today, and they told me he's vetoed that legislation before, and if it looked pretty much the same, he'd do it again -- Wolf.

BLITZER: Thanks very much, Chris, for that.

Let's get more now on the protest, the immigration debate. For that we're joined by our CNN contributor Bill Bennett, the host of the radio program "Morning in America."

These are huge demonstrations in 70 communities all over the country. It looks like they're trying to generate grassroots support for some sort of legislation that would eventually lead towards citizenship.

BILL BENNETT, CNN CONTRIBUTOR: Sure, huge demonstrations and it's a huge number of people. You've got 11 or 12 million possible people to show up at these rallies, in terms of the illegal immigrants who are in the country.

BLITZER: But not all illegal immigrants.

BENNETT: Plus, I'm sure there are some legal folks here -- there, as well. So there is pressure for change. What's interesting to me is the politics of it, which is Hillary Clinton is addressing it. I think here in Washington, Kennedy is going to address it, Schumer and Sharpton. This is a co-sponsored -- Republican and Democrat co-sponsored legislation in the House -- in the Senate. Where are the Republicans? They got rolled on this again. They're supporting this legislation in the Senate.

BLITZER: Senator McCain...

BENNETT: Senator Mc Cain is there's enough --

BLITZER: ... Senator Specter and even Senator Frist, the majority leader...

BENNETT: That's right.

BLITZER: ... came around at the end.

BENNETT: But if this is passed, the Democrats, I'm sure they get all the credit with these groups.

It's a mistake, by the way, I think, a serious mistake to go with that Senate bill. You're not going to have legislation any time soon.

BLITZER: You like the House version, which is much tougher?

BENNETT: It's closer. I don't like the felony. But I like the House version.

BLITZER: Because the speaker said he would be willing to compromise -- in a compromise -- in a conference committee to put that down to a misdemeanor as opposed to a felony.

BENNETT: And Sensenbrenner was willing to do that, too. I think what a lot of people are thinking now, not necessarily the opinion leaders, not necessarily the political leaders but, again, if you listen to talk radio and you listen to opinion polls, people are saying, "Give us the security. Give us the border security first. Guarantee us that the flood will not keep coming. Then we'll look at these things in stages."

BLITZER: I'm curious about Senator McCain.

BENNETT: Yes.

BLITZER: Here he is with Senator Kennedy. They've combined to forge this coalition on this issue, which is so important to the political base of the Republican Party.

BENNETT: Right, right.

BLITZER: And at a time when he's also aligning himself to a certain degree with the Rev. Jerry Falwell, going to Liberty University to give a commencement address, saying nice things about Jerry Falwell. Someone who admires, like you, Senator McCain, what's his strategy right now? BENNETT: Well, it's a good locution: "I'm curious about Senator McCain." A lot of people are. I admire him, I like him, I think he's an impressive guy. He's obvious a hero. And I disagree with him like crazy on some things, such as immigration reform. And I disagree with him on campaign finance reform, and I can think of other things. But he has to be regarded now, I think, as the leading candidate.

BLITZER: For the Republican nomination?

BENNETT: Yes. He is with Bush now. They've very close to the Bushes. He's very close to the Bushes. On issues he seems to be dictating a lot of the policy. You remember the torture debates. You remember the -- now we have the immigration thing, the campaign finance reform, which was signed by George Bush, but the media has now, or at least some of the media has now turned against him, when they could use him to...

BLITZER: It hasn't necessarily turned against him; they're asking him some tough, serious questions.

BENNETT: Well, even John McCain acknowledge that his base -- at one point, he said jokingly, "My base is the journalistic community." But they're asking him tough questions. They don't like the fact that he's cozied up to Jerry Falwell. Now that's when McCain blew up last time, in 2000, when he gave that speech and he attacked Falwell and Robertson, which surprised, I think, almost everybody.

BLITZER: Pat Robertson.

BENNETT: Yes.

BLITZER: Here's what Mike Murphy, a well-known McCain adviser, a top political strategist...

BENNETT: Right.

BLITZER: ... said: "When loving McCain was a way of expressing a negative opinion about the Republican Party, they" -- referring to the media -- "were all for him. Now that McCain is a strong, potential candidate, some fickle liberal hearts are not fluttering as much."

BENNETT: Well, I think -- I think that's right. He is the -- or the Republican that liberals love to like. But when he goes to Liberty University, they like him a little less.

What McCain can do is play this maverick card again and say, "Look, I really am a maverick. I don't live up to your expectations; I live up to mine." To the degree that the war is a big issue and strong leadership of the war is a big issue, I think it favors McCain, because if anything, and this is the real irony of liberals embracing McCain, he is to the right of George Bush on the war. He thinks there should be more troops.

BLITZER: And you think he's the front runner for the Republican nomination right now, even ahead of, let's say, Rudy Giuliani? BENNETT: I think he is. Right now I think he is, but we'll see. There's a lot of water. And as we saw in 2000 with McCain and Bush, it was a very interesting back and forth.

BLITZER: A lot of candidates on the Republican side.

BENNETT: Yes.

BLITZER: A lot of candidates on the Democratic side, as well. That will make it interesting.

BENNETT: But they get to speak at the rallies. It looks like the Republicans don't.

BLITZER: I'm sure there must be at least a few Republicans speaking at some of those rallies, but we'll see.

BENNETT: We'll see.

BLITZER: Bill, thank you very much.

And to our viewers, remember, you're in THE SITUATION ROOM, where political news is arriving all the time. CNN, America's campaign headquarters.

Still it come, it's not exactly a bake sale. Some students in Maryland are getting school credit for marching in today's immigration protest. What do you think of that? Jack Cafferty going through your e-mail.

And it appears that money is the root of all executive pay. Which CEOs are worth $100 million? We'll tell you.

(COMMERCIAL BREAK)

BLITZER: Lou Dobbs getting ready for his program that begins right at the top of the hour, and Lou's standing by to tell us what he's working on -- Lou.

LOU DOBBS, HOST, "LOU DOBBS TONIGHT": Thank you, Wolf.

Coming up at 6 here on CNN, we'll have complete coverage of today's nationwide massive protest in favor of amnesty for millions of illegal aliens. We'll have a special report, as well, on how the illegal alien lobby is manipulating the language of many of these protests, trying to advance what is a much wider, larger and mostly hidden agenda.

And tonight we'll be reporting on the Democrats and Republicans alike who are trying to exploit these protests and demonstrations for their own political purpose -- purposes.

And among my guests tonight, a leading advocate of amnesty for illegal aliens, Congressman Javier Becerra. And one of the organizers of today's nationwide demonstrations, Nativo Lopez, national president of the Mexican/American Political Association. We'll have all of that. We hope you'll be with us. Wolf, back to you.

BLITZER: Thanks Lou, very much. And this note to our viewers: Lou is going to be here in THE SITUATION ROOM 7 p.m. Eastern, as well. We'll talk more about the immigration debate with Lou and with Univision actor Maria Elena Salinas. That's coming up, 7 p.m. Eastern tonight.

Time now for Ali Velshi. He's joining us with "The Bottom Line."

Hi, Ali.

ALI VELSHI, CNN CORRESPONDENT: Hello, Wolf.

Well, for the thousands who lost their jobs and their life savings, today was a day that they have had circled on their calendar for a long time.

Jeff Skilling, Enron's former CEO, took the stand in Houston in his own defense today. Under oath, Skilling says he's innocent and that he'll fight the charges, quote, "until the day I die," end quote.

The 52-year-old Skilling told the courtroom that he was nervous because his life was on the line. Look for some fireworks later in the week, Wolf, when prosecutors get their crack at Skilling in cross- examination.

Now Jeff Skilling probably wishes we were talking about him for this next story. CEOs of the country's hundred largest companies made an average of -- well, a median of $18 million last year. That's a 25 percent increase over the previous year, compared to the three percent increase that most people earn.

The top six earners in corporate America last year brought home more than $100 million, most of it from selling stock options. The nation's most richly compensated CEO, Richard Fairbanks of the credit card company Capital One, took no salary and got no bonus, but he made $250 million just by selling stock options. You know, that Capital One ad that asks you what's in your wallet?

For stocks, Wolf, we had a mixed day today. The Dow Jones closed 21 points higher, to 11,141. The NASDAQ closed five points lower. The story is oil, a barrel of it in New York, $68.74. And we're going to talk a little bit more about that at 7 Eastern. But we're only about $1 away from the all-time closing high on oil -- Wolf.

BLITZER: All right. Thanks very much, Ali, for that. Ali with "The Bottom Line".

Could the person preparing your taxes this season have a criminal record? A new report says it might be the case and that the IRS needs to do more to prevent it. Out Internet reporter, Abbi Tatton, once again joining us with details -- Abbi.

ABBI TATTON, CNN CORRESPONDENT: Wolf, tax practitioners are the people that we rely on to help us prepare our tax returns and also give us tax advice. And the IRS has an office that oversees their conduct.

But this new report says the IRS is not doing enough. In fact, they're letting some incompetent and disreputable tax practitioners slip through net. Investigators looked at some of their conduct and found a couple of things.

A very small percentage, but significant, nonetheless, of these tax practitioners were not complying with their own tax obligations. They found 34 of them who owed over $800,000. They also found others with criminal records or with revoked licenses.

The IRS has responded to this report. They have agreed with many of the recommendations in it, and they say that they'll coordinate better with state licensing authorities -- Wolf.

BLITZER: Abbi, thank you very much.

Up ahead here on THE SITUATION ROOM, a rare Ferrari destroyed beyond recognition after a crash in California. So why was a Swedish businessman arrested? We're going to have details.

(COMMERCIAL BREAK)

BLITZER: Betty Nguyen is joining us with a developing story we're following.

Betty, what's going on?

BETTY NGUYEN, CNN ANCHOR: Yes, Wolf, this is the story out of Duke University, where the lacrosse team, the men's lacrosse team, were supposed to submit DNA testing. They did that. At least 46 of the 47 players did.

Well, today, those test results have come back, and it shows there is no DNA match between the members of Duke's men's lacrosse team and the woman who says that she was raped during a party at the lacrosse team's house there on Duke University.

Let's take a listen to what the defense attorneys had to say today. This news conference is under way right now.

MIKE WALL, DEFENSE ATTORNEY: Well, the photographs are very consistent with the statements from all these young men. They have said consistently that a sexual assault did not occur. These photographs corroborate the statement of all 46 of these young men.

It's very clear that the victim in this case came to the house with injuries on her. It's also very clear that less than 30 minutes later, she was outside the door where the door was locked. So, we are not releasing the photographs at this time, but, we have stated, and I will state now that these photographs...

NGUYEN: That's the defense attorneys speaking about the photographs that were taken that defense attorneys say prove that the players did not participate in this alleged rape.

But the latest news coming out, that there was no DNA match between the Duke lacrosse team and the woman, the exotic dancer who says she was raped during a party at the lacrosse team's house there on campus.

Of course, we're going to stay on top of this and bring you the latest as we hear more information.

BLITZER: In other news, federal jurors in Alexandria, Virginia, are hearing a litany of tears and tragedy today in the death penalty trial of confessed 9/11 conspirator Zacarias Moussaoui. Among those who testified today was the grandfather of the youngest 9/11 victim, a 2-year-old girl. Christine Hampton (ph) died with her parents in one of the planes that hijackers flew into the World Trade Center towers.

A Swedish businessman is in custody in California, arrested in connection with a case stemming from the wreck of a rare Ferrari in February. Sheriff's officials say Stefan Eriksson did not own the million-dollar Enzo Ferrari or the Mercedes and the second Ferrari in his car collection. They say he lapsed on his payments after moving to L.A. last year. He is now under suspicion of grand theft -- Wolf.

BLITZER: Betty, thank you very much.

Coming up next, your answers to our question of the hour. Jack Cafferty standing by. Stay with us.

(COMMERCIAL BREAK)

BLITZER: Let's go right to Jack in New York -- Jack.

JACK CAFFERTY, ANCHOR: Some Maryland high school students are getting school credit for attending today's immigration rally in our nation's capitol. It's part of some state community service graduation requirement. We asked if you thought that was a good idea. Here is some of what you wrote to us.

Angel in Victorville, California: "it's a teacher's job to teach and not be a political motivator, union boss or march organizer. A novel idea would be to challenge kids to actually learn reading, writing and arithmetic. If this was a priority, then maybe our dropout rates of blacks and Hispanics in Los Angeles would be better than 50 percent."

Tracey in Columbia, South Carolina: "Public school: public tax money is best used for education and teachers would be serving our students better with lively debate of the issue, not picking sides and filling their ranks."

Steven in Oklahoma City: "If they want to gain credit, attend a special class on the political process on school grounds, help the elderly in a rest home, or help a disabled veteran to a medical appointment. Any of the latter would be a public service. Attending a protest that allows those who violate and invade our country for their own benefit is not a public service by any stretch of the imagination."

And Nick in Normal, Illinois: "Jack, as a young person I totally support the school district's decision. So many students and young people don't care about politics or important issues affecting them. Any time students stand up for something they believe we should be saluting them" -- Wolf.

BLITZER: Jack, thanks very much. See you in an hour. We'll be back in one hour. More of THE SITUATION ROOM. In the meantime, "LOU DOBBS TONIGHT" starts right now -- Lou.

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