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THE SITUATION ROOM

Senate Rejects Constitution Amendment Banning Flag Burning; Relentless Rains in Washington, D.C.

Aired June 27, 2006 - 19:00   ET

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


WOLF BLITZER, CNN ANCHOR: Standing by, CNN reporters across the United States and around the world to bring you tonight's top stories. Happening now, it's 7:00 p.m. here in Washington where the vote is now in. The senate has just decided on a controversial amendment to the constitution that would ban the burning of the American flag. We're going to show you what exactly happened on the senate floor.
Also tonight, new calls for an investigation in the wake of a leak to the "New York Times" and other newspapers. Did they damage national security and should they be prosecuted? I'll speak with a man calling for a full-scale investigation. Republican senator Pat Roberts, he's the chairman of the intelligence committee.

And even as he faces a new trial for genocide, does Saddam Hussein think he can get off the hook by trying to help the U.S. quell the insurgency. I'll ask a key member of his defense team, the former U.S. attorney general, Ramsey Clark. I'm Wolf Blitzer, you're in THE SITUATION ROOM.

We begin with a developing story on Capitol Hill where by the narrowest of margins the senate has just rejected a constitutional amendment that would have banned desecration of the American flag. Let's go straight to our congressional correspondent Dana Bash. Dana, what happened?

DANA BASH, CNN CONGRESSIONAL CORRESPONDENT: Hi Wolf. Well it was a nail biter until the end, but as you said, this constitutional amendment that dealt with flag desecration, failed by just one vote. In the end, the vote count was 66 to 34. That is just shy of the 67 votes that would have been needed for the two thirds majority to actually amend the constitution. The way it broke down is actually 14 democrats voted with republicans in support of this constitutional amendment and three republicans voted against it.

I should note that one of those democrats voting for it was actually the democratic leader, Harry Reid. And on the republican side one of the republicans against this the number two republican Mitch McConnell. The number two republican in the senate. So that just shows you how difficult and perhaps complicated the politics of this is when you're dealing with what we heard on the senate floor over and over again, the big question about whether or not, not only the flag should be protected from desecration, but just how far senators thought that they should go. Whether it meant actually amending the constitution or not because senators opposed to that said that they thought that was actually hurting another sacred symbol of the United States and that's the constitution. Wolf?

BLITZER: Dana Bash on the hill once again. There will be no constitutional amendment, at least not this year that would have called for a ban on burning of the American flag or other desecration of that flag as well.

Same time we're getting new information on the war in Iraq where the death toll is rising. The U.S. military has announced today that a marine and three more soldiers have died in the latest violence, bringing the American death toll to 2 ,527. While the cost in lives is all too clear, the wars in Iraq and Afghanistan are also taking a major toll on the U.S. military's equipment. Top commanders were on Capitol Hill with the repair bill among other things, let's go live to Joe Johns he's watching that story. Joe?

JOE JOHNS, CNN CORRESPONDENT: Wolf, it's been a costly war in lives and limbs and dollars and cents. War spending and the aftermath of 9/11 now at an estimated $437 billion according to a report by the Congressional Research Service. Iraq accounts for most of that at $319 billion. Afghanistan, roughly $88 billion. So what's costing so much, the pace of the war for one thing also forced protection such as body armor, increasing oil prices. But there's also that issue of military equipment which has to be repaired or replaced in order to bring units up to full readiness once they've been rotated out of combat operations. It's known as resetting in pentagon jargon, it's something the congress has not yet dealt with fully. Those unpaid bills are now coming due and the generals are pushing for the government to pay up.

(BEGIN VIDEO CLIP)

GENERAL PETER SCHOOMAKER, ARMY CHIEF OF STAFF: In Operation Iraqi Freedom, for example, crews are driving tanks in excess of 4,000 miles a year. Five times more than programmed annual usage rate of 800 miles. Army helicopters are experiencing usage rates roughly two to three times programmed rates.

GENERAL MICHAEL HAGEE, MARINE CORPS COMMANDANT: We have used our equipment, it's actually held up relatively well. But we have used some very good equipment. We have aged it as the chairman mentioned, five, six, seven times more than we thought that we would. And we have used it in a very harsh and unforgiving environment.

(END OF VIDEO CLIP)

JOHNS: The army chief of staff said his branch will need $17 billion for equipment resetting. The commandant of the marine corps said he'll need about $12 billion and this expense will come with or without troop withdrawals because the military still needs to get geared back up to be ready for the next threat whenever and wherever it happens. Wolf?

BLITZER: Joe Johns, thanks very much.

Republicans, meanwhile, are outraged over the "New York Times" reporting on a secret government surveillance program targeting terrorist-backed transactions around the world. The president and the vice president call it disgraceful, now there's a formal call for the director of national intelligence to assess the damage done by the reporting on the government surveillance program.

It's coming from Senator Pat Roberts. He is the chairman of the Senate Intelligence Committee and Senator Roberts is joining us here in THE SITUATION ROOM.

Senator, thanks very much for coming in.

SEN. PAT ROBERTS (R-KS), INTELLIGENCE CHAIRMAN: Oh, thank you.

BLITZER: What specifically do you want to happen right now?

ROBERTS: I want John Negroponte, who is the director of national intelligence, to tell us whether or not there's a damage assessment where he can assess whether or not these leaks and all these revelations, mainly by two major newspapers, have made our country less safe. That's the long and the short of it.

Now, I know exactly what's going to happen with your next question. The First Amendment, I'm a great protector of the First Amendment, I'm an old newspaper guy. And secondly, the "New York Times" has every right -- and the "Washington Post" or whoever it is -- to print whatever they want. But the question is, is it prudent to do so?

BLITZER: Senator, we have got a little mic problem. I'm going to have you hold this mic so you can talk there. Go ahead.

ROBERTS: All right. Thank you.

BLITZER: Just pick it up.

ROBERTS: Is it prudent to do so? The al Qaeda is at war with us. Every week in the Intelligence Committee, we know about a new threat. They are plotting attacks as we discuss this. And here we have two major newspapers really making a lot of revelations about the highest classified programs we have to detect, deter and stop terrorists.

BLITZER: Well, let me interrupt here for a second, Senator. It's the leakers, the government officials, who provided this information to newspapers who are at fault. Is that fair?

ROBERTS: I think that's a fair summary. I said ...

BLITZER: Are you calling for a criminal investigation to begin by the Justice Department of those government officials, whether from the executive branch or the legislative branch, who gave this story to the "New York Times," the "Los Angeles Times," "The Wall Street Journal," the three major newspapers that published this information?

ROBERTS: Well in a word, yes. I know this investigation is already ongoing with the terrorist surveillance program. Here we have two programs. BLITZER: Let me interrupt.

ROBERTS: Yes.

BLITZER: Do you know for sure that the Justice Department has been asked by the CIA or the director of national intelligence to undertake a criminal investigation into who leaked this story?

ROBERTS: This particular story I am not sure. But on the terrorist surveillance program ...

BLITZER: On the NSA, the National Security Agency story.

ROBERTS: Yes, OK, yes.

BLITZER: What about this story?

ROBERTS: I think it would be comparable.

BLITZER: Because I hear a lot of people are complaining about the "New York Times" and "The Wall Street Journal" and the "Los Angeles Times". I don't hear a lot of Republicans saying, you know what, these papers are doing their job. It's the leakers, the government officials, who may have broken the law by providing classified information to a newspaper.

ROBERTS: Well, you heard me say it in regards to the chairmanship of the Intelligence Committee when we passed a law during -- not this session, but during the Clinton presidency, when we said if somebody signs a nondisclosure form and they're working for the government and intentionally they leak classified information that could make our country less safe, that maybe we should increase the penalty from a misdemeanor to a felony.

Now, that raised a lot of eyebrows and a lot of people said, are you talking about newspaper reporters? That's not what I'm talking about. I'm not talking about the First Amendment. I am not talking about the right of the "New York Times" to print whatever they want. I think that left hand column up there said "all the news that is fit to print." Right now it says all the classified material that is endangering our country and making it less safe and that's not right.

BLITZER: Well, here's what the editor of the "Los Angeles Times" wrote in defending his newspaper's decision to publish this information: "In the end we felt that the legitimate public interest in this program outweighed the potential cost to counterterrorism experts (sic)." The "Wall Street Journal" by the way, came up with the same conclusion because they published the same information, so it's not just the "New York Times."

ROBERTS: Well, and I would quarrel a little bit with saying Republicans. I think there are Republicans and Democrats, especially on the Intelligence Committee, who are very worried about this. And, again, I don't quarrel with the "Wall Street Journal" or the "L.A. Times" or the "New York Times" or the "Washington Post" in regards to their First Amendment rights to print anything they want to. Is it prudent? Is it wise? Does it make America less safe? That's why we're asking the director of national intelligence do a damage assessment, because I believe now that we are less capable, we are less safe than we were before.

BLITZER: But since 9/11 -- and the editors of these newspapers make this point. Since 9/11 the Treasury Department has been outspoken in saying you know what? We're spending a lot of money, we're spending a lot of time looking into international bank transfers, wire transfers, we're following the money. Don't you think the terrorists out there already knew that whatever they wired, whatever they did, was potentially subject to being picked up?

ROBERTS: Speaking about it generically is different from printing the actual way that it is done. Speaking in generic terms, using all the tools that the intelligence community -- that we have at our disposal, that's one thing. But putting the actual plan out there in the public -- I trust the American public, but I don't trust our adversaries.

And I do know, it's just like General Hayden has said, who is the new director of the CIA, the only people we're catching now are stupid terrorists. And so I think we have a diminished capability and as such the question is, is it prudent for this kind of information to be on the front pages of American newspapers if it makes our country less safe? We'll find out.

BLITZER: But you don't know the answer to that question yet?

ROBERTS: I think I know pretty much because I have asked that question time and again in recent weeks when we've had, you know, these leaks in this coverage.

BLITZER: Here's what Bill Keller, the executive editor of the "New York Times" ...

ROBERTS: Yes, I have a little feeling about Bill Keller. Go ahead.

BLITZER: ... on Sunday, he said, "The people who invented this country saw an aggressive, independent press as a protective measure against the abuse of power in a democracy, and an essential ingredient for self-government. They rejected the idea that it is wise or patriotic to always take the President at his word, or to surrender to the government important decisions about what to publish." Speak as a son of a newspaper man and yourself, a former journalist.

ROBERTS: Well, when I was journalist, number one I always quoted people. I didn't use reliable sources or whatever. I met with Bill Keller. I met with him the day before that story broke. I can't speak for the others who met with him and I won't do that. And the whole question was, were we briefed? And the answer was yes.

BLITZER: When were you briefed?

ROBERTS: That was December 15th. BLITZER: Of this last year?

ROBERTS: Yes, and on December 16th ...

BLITZER: Even though the program had been going on for at least three years or so?

ROBERTS: Yes, and the "New York Times" waited on it and waited on it and waited on it. Now, the real reason they published it was that James Risen had it in his book.

BLITZER: That was on the NSA program?

ROBERTS: Yes, that's correct.

BLITZER: But I'm talking about the bank transactions. When were you ...

ROBERTS: Now, I'm not talking about the bank transactions now and I want to take one step further. After those questions were posed in that meeting, on the very next day that story ran. So we were set up. All we were, were a check off box.

BLITZER: That's on the NSA but I'm talking about the bank ...

ROBERTS: And everyone urged him not to run that story.

BLITZER: The NSA story?

ROBERTS: That is correct.

BLITZER: Did you speak to Bill Keller also on this story?

ROBERTS: No, I don't think I would want to speak to Bill Keller on any story in regards to what is prudent and what is not in trying to publish classified information.

BLITZER: Can you tell us when you were briefed as the chairman of the Senate Intelligence Committee on this bank transaction story?

ROBERTS: We had been briefed on several occasions.

BLITZER: Over these years, or is it just relatively recently because the suggestion has been once the "New York Times" started asking administration officials about this story, then the administration rushed to brief the legislative branch.

ROBERTS: No I don't think that's an accurate description. I think members of the committee had been briefed on this program.

BLITZER: Years ago, because it started apparently right after 9/11?

ROBERTS: I'm not going to -- I can't either confirm or deny the specific date. I just know that the Intelligence Committee has been briefed. And it is a detailed plan -- I mean it isn't any secret anymore. And obviously al Qaeda and others and the terrorists changed the way they operate. They are not stupid.

BLITZER: Do you think that Bill Keller of the "New York Times" or the editors of "The Wall Street Journal," the "Los Angeles Times," the "Washington Post," all of these newspapers published this story last Friday, if in fact John Negroponte concludes in your request for this investigation, that yes, there was damage done to national security, they should be formally prosecuted?

ROBERTS: No, I'm not saying that at all. I'm not after the reporters. Again, I'm not quarreling with the First Amendment, I'm not quarreling with the right of the "New York Times" to print whatever it wants or the "Washington Post." That's the freedom of the press that everybody protects and that's the way it should be.

But with all the leaks and all the people who sign a disclosure statement saying I'm not going to do any leaking, that is where the investigation will lead. I'm just saying simply because they have the right to do it, doesn't make it smart or prudent when you are revealing classified information that damages our sources and methods and lives, not to mention that, but our relationship with our allies. It just doesn't make any sense.

BLITZER: Senator Pat Roberts, the chairman of the Intelligence Committee. Not only thanks for coming in, but thanks for holding that microphone.

ROBERTS: OK. Thank you.

BLITZER: Appreciate it very much.

ROBERTS: Hand it to me any time.

BLITZER: All right. Thanks, Senator.

Jack Cafferty is in New York, he's standing by with the Cafferty File. Jack?

JACK CAFFERTY, CNN ANCHOR: It's not Senator Jack Cafferty, it's thank you senator.

BLITZER: Yes. You're not a senator yet, Jack, but you never know. You're still a young man. You might be a senator one of these days. I'm sure a lot of our viewer would be happy to vote for you.

CAFFERTY: Don't hold your breath. Stay away from smokers. That's the message from the U.S. Surgeon General Richard Carmona. A new government report found that only smoke free buildings and pubic places truly protect nonsmokers from the hazards of second hand smoke. Carmona calls it involuntary smoking. It puts an estimated 126 million nonsmokers at greater risk of death from lung cancer, heart disease and other illness. 17 states in more than 400 cities and towns and counties have already passed stringent no smoking laws.

But Carmona is particularly worried about young kids who aren't protected when their parents choose to light up. Over one in five children is exposed to second hand smoke at home. They are at a higher risk of sudden infant death syndrome, lung and ear infections and more severe asthma. So here's the question. Is enough being done to protect nonsmokers from second hand smoke? E-mail your thoughts back to caffertyfile@cnn.com or go to cnn.com/caffertyfile. Now back to Senator Blitzer.

BLITZER: Thanks. Not going to happen, either. Thanks very much for that, Jack. Coming up. We're going to show you this. These are live pictures we're getting in right now. These are Israeli tanks, they're poised at the border with Gaza. There's possible military action to come. We're keeping a close eye on what's going on along the border between Israel and Gaza.

Plus, disaster evacuations. Is the nation's capital ready for the next big one? The city has been crippled by rain, we're going to take a closer look at what might actually happen to Washington, D.C. if something more serious were to strike.

Also, Saddam Hussein, can he help the U.S. stop the insurgency in Iraq? We'll talk to one of his lawyers, the former Attorney General of the United States, Ramsey Clark, he's here in THE SITUATION ROOM.

And billion -- yes billion-dollar fraud. The American taxpayer becomes the latest victim of hurricane Katrina. It's your money, we're keeping track of that. Stay with us. You're in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: Welcome back. How much more can one city take? Here in Washington, D.C. the rain is relentless. Shutting down the building that actually houses the United States Constitution and flooding others, even the basement of the IRS. And the worst may be on the way. CNN Meteorologist Bonnie Schneider is standing by with the forecast but let's go to Brian Todd. He has the latest on what's happening here in the nation's capital and the impact. Brian?

BRIAN TODD, CNN CORRESPONDENT: Wolf, we're standing here on Constitution Avenue, one of several major arteries still partially closed because of the flooding here. Now between this traffic, the power outages, the government shutdowns and other programs, officials here are taking it on the chin over the response to this storm. While they defend themselves many others are worried about more ominous possibilities.

(BEGIN VIDEOTAPE)

TODD: Over the past 48 hours nearly a foot of rain in some places. Flash floods, motorists stranded, traffic lights out. At least five U.S. government facilities closed. Over the next 24 hours, more rain on the way. And a city still grappling with those same problems could be overwhelmed. What if this weather barrage had been a terrorist attack?

RICHARD FALKENRATH, CNN SECURITY ANALYST: If this had been a life threatening incident for a lots of people, I think we would have had pandemonium on the streets. TODD: CNN Analyst Richard Falkenrath is an expert on homeland security, who's about to join New York's Police force as its director of counter-terrorism. Falkenrath and other experts say Washington has a poor record handling population flow during natural disasters. Command and control they say a huge problem. Too many jurisdictions in the metropolitan D.C. area with no one agency or official making key decisions. Officials at the D.C. Emergency Management Agency say they can't help it if roads flood and lights malfunction in bad weather. But if terrorists strike?

BARBARA CHILDS-PAIR, WASHINGTON EMERGENCY MANAGEMENT AGENCY: We have traffic management plans rerouting efforts and then we're not looking at everybody coming in and going out at the same time. So we have plans in place to kind of maneuver folks to get out of town.

TODD: But Falkenrath worries about another factor all major cities would face during a terrorist attack.

FALKENRATH: If the people stuck in those traffic jams felt that they were at risk themselves or their families were at risk somewhere else, I think you'd have a lot of very problematic behavior by individual commuters.

TODD: As for the federal government, agencies still closed like the Justice Department have kicked in their so-called continuity of operations plans to function from other locations. Experts say those plans, for the most part, have worked well.

(END OF VIDEOTAPE)

TODD: But the experts we spoke to, along with the Department of Homeland Security in a recent report point out that D.C. is not alone here. That most major cities don't have very good contingency plans for evacuation or other emergency procedures. But they also point out it is almost impossible to efficiently evacuate almost any major city under almost any circumstances. Wolf?

BLITZER: Brian Todd on the streets of Washington. Thanks very much. Meanwhile the weather situation could get worse. Our meteorologist Bonnie Schneider is joining us from the CNN Weather Center. Bonnie how bad is it?

BONNIE SCHNEIDER, CNN METEOROLOGIST: Well right now Wolf we still have rain coming down in areas that are completely saturated. When the ground is saturated, it just can't hold any more water. So flash flooding still a possibility. A probability especially in the low lying areas of eastern Maryland into Sussex County into Delaware, where we saw a tremendous amount of flooding over the past week and into the weekend. You could see now what's happening is we have our big batch of rain here over parts of Maryland and Pennsylvania. But an influx to it is tropical moisture coming from a system that hurricane hunters were investigating earlier this afternoon to be possibly a depression. It is not a tropical depression but it is kicking up enough tropical moisture that's enhancing the rain. We're expecting it to continue straight through the night. In fact flood advisories are posted straight through tomorrow morning. Wolf? BLITZER: Bonnie thanks very much. We'll check back with you. How will all of this rain affect east coast travel. Our Internet Reporter Jacki Schechner is joining us with that. Jacki?

JACKI SCHECHNER, CNN INTERNET REPORTER: Wolf I wanted to show you this cool tool online, this is a U.S. geological survey and they keep track of all this water using things called gauges in rivers and streams. That's what these dots are, I'll give you a closer look. Now these gauges have been in place for 30 years or longer. There's some 7,000 of them across the country, they update automatically to the Internet. The black dot means that this is the highest level ever recorded at this particular gauge on this date.

Again, we're talking about years and years. The blue ones mean it's the highest level or higher than 90 percent of other levels recorded. Let's take a closer look like at the Skullkyl (ph) River, for example here you can see this is a level at which it floods and here we are right now. Now why is this important to you because this is some of the information that the National Weather Center uses in order to make its flood watches and warnings. And you can see here in the northeast, that's exactly what we're looking at now. Wolf?

BLITZER: Thanks very much Jacki for that. Still to come, Saddam Hussein facing yet more war crimes charges. But he's also offering to help unify the country or is he? Is it all a ploy? I'll ask his lawyer the former United States Attorney General Ramsey Clark, he's here in THE SITUATION ROOM.

Plus, American taxpayers, the latest victim of hurricane Katrina. We'll find out how billions of dollars went down the drain in fraud. It's your money, we're watching it, stay with us.

(COMMERCIAL BREAK)

BLITZER: I'm Wolf Blitzer in Washington. You're back in THE SITUATION ROOM. Iraqi officials are announcing another trial for the former dictator, Saddam Hussein. He'll face charges starting in August in connection with the killings of as many as 200,000 Kurds back in the late 1980s. Meanwhile, his current trial continues amid a debate on what role if any Saddam Hussein can play in helping unify the country. Talk about that in just a moment with a member of Saddam Hussein's defense team, the former U.S. Attorney General Ramsey Clark. But first, let's go to CNN's Mary Snow, she's joining us from New York. Mary?

MARY SNOW, CNN CORRESPONDENT: Well Wolf as Saddam Hussein faces closing arguments next month in this current trial, it seems he's come up with a plan to change his fate. This as questions are raised about the role of his supporters.

(BEGIN VIDEOTAPE)

SNOW: Saddam Hussein apparently believes he can evade a death sentence because he thinks the U.S. will seek his help in stopping the insurgency ravaging Iraq. That is according to Hussein's chief defense lawyer, who recently spoke with the "Associated Press" and the "New York Times." One Iraqi expert suggests the idea says more about Saddam Hussein's mindset than about reality.

PHEBE MARR, U.S. INSTITUTE OF PEACE: He's isolated, it's wishful thinking and in addition to that, it may be one of the few ploys that the defense lawyers have.

SNOW: Though Saddam Hussein can likely be counted out of any type of peace negotiations, some have suggested including loyalists to the former Iraqi leader. That's something that Iraq's prime minister discounted on Sunday when he said Saddam Hussein's supporters would be excluded from the nation's reconciliation plan.

MARR: To be frank about it, I don't know how many Saddam loyalists there are. My guess would be that it's a small number.

SNOW: But some Middle East experts say whatever their number, those loyalists have to be brought into the system in some way.

JON ALTERMAN, CSIS MIDDLE EAST PROGRAM: What Saddam's loyalists coming on board would do, is it would send a signal that this is really over, that the old Iraq has made peace with the new Iraq.

SNOW: And even some who say former enemies will have to work together in the new Iraq, equate Saddam Hussein's inclusion in the new equation with ruin.

ALTERMAN: You can make peace with the people who had supported Saddam, but it seems to me that you can't use Saddam as a way to get there.

(END VIDEOTAPE)

SNOW: And as for the question about the role of Saddam Hussein loyalists in the insurgency, the experts we spoke with said it's unclear where the backbone of the insurgency lies -- Wolf.

BLITZER: Mary Snow, thanks very much.

Let's get some more insight now. For that, we turn to someone very familiar with Saddam Hussein, and the cases against him.

(BEGIN VIDEOTAPE)

BLITZER: And joining us now is Ramsey Clark, the former U.S. attorney general, now one of Saddam Hussein's attorneys. There's talk that Saddam Hussein is thinking of making a political comeback, talking to some of his other attorneys. Is that at all realistic in his mind?

RAMSEY CLARK, ATTORNEY FOR SADDAM DEFENSE TEAM: I don't think he has any thoughts of a political comeback. I've never heard him say anything about it or seen any indication of it.

The thing that he always says and is always clear is that he's torn apart by what he sees happening to his country, to the people of Iraq. And the thing he says above all is Iraqis should never kill Iraqis. You've got to join together. BLITZER: So the Saddam loyalists, the insurgents who say they're loyal to Saddam Hussein, who are involved in a lot of these attacks, he doesn't want them to do that? He wants them to lay down their arms?

CLARK: He doesn't want any Iraqis killing Iraqis. He wants the Iraqi people to be unified. He thinks the worst thing that can happen is for them to kill each other and he abhors talk about sectarianism.

BLITZER: Is he planning on making any statement to his supporters, to his followers, that would make that point?

CLARK: Well, he's said it several times in court. He's always said, "Iraqis should not kill Iraqis. We are a people. We're all the same together, and we cannot fight each other."

BLITZER: Is he fatalistic in the sense that he expects to be executed?

CLARK: He's certainly fatalistic in the sense that it's a long- term attitude, that what will be will be, and his enemies have him in their power and they intend to kill him. That's what he believes, I think.

BLITZER: The Dujail phase of the charges against him now wrapping up, coming to an end. That particular trial coming to an end. Another one about to begin supposedly in August.

One of his other attorneys, Khalil al-Dulaimi, is quoted in the "New York Times" as saying this: "Those executed at Dujail deserved to die according to Iraqi law. They were part of an illegal organization plotting to kill a president, and they killed some of his bodyguards. They were threatening the stability of the country." Do you support that line of defense that Mr. Al-Dulaimi made?

CLARK: That's translated from Arabic. I think what he was saying is that there were 148 people there sentenced to death more than two years after the assassination attempt. And it wasn't just one assassination attempt. Remember, Tariq Aziz said they tried to assassinate him. There were a string of them.

They were all by the Dawa Party. The Dawa Party was an Iranian party. It was centered in Tehran. The president -- Saddam Hussein testified at the trial that the first announcement of the Dujail assassination attempt on him came from Tehran.

BLITZER: So did the people who were killed at Dujail deserve to die?

CLARK: Well, I don't think anybody deserves to die. I think what he was saying is that they were sentenced to death under Iraqi law and it was for treason against your country in time of war, including an attempt to assassinate the president by the Dawa Party, 148 people out of a city of 75,000 maybe, in a war in which maybe 40,000 Iraqis had been killed that year. There was a bloody Iran-Iraq war going on -- people that fled from Dujail to Iran. And the Dawa Party was centered there. They'd been sentenced after two years of investigation, based on confessions, to death. And it was a mandatory law. We used to have in the United States mandatory law. If you're convicted of treason, death.

So if you follow the law -- I'm opposed to the death penalty in every case. Always have been. The only attorney general in history to oppose the death penalty. So I can't say I think they should have been executed. But I can say that it's clear that's what the law was.

BLITZER: That's what the defense is. One of your other colleagues, Khamis al-Obeidi, who was murdered in Iraq only within the past few days, back in November, he said, "We think that it's impossible to hold a trial in Baghdad in these security conditions and that the court should be transferred to a location outside Iraq."

You're about to go back to Iraq in the coming days. Are you convinced that there can be security for you and your colleagues to have a trial involving Saddam Hussein and his other co-defendants?

CLARK: Well, obviously, three have been murdered now, or assassinated, three lawyers. All Iraqis, I've believed from the beginning and said from the beginning, that the people who need protection are the Iraqi lawyers and their families and their investigators. We never were able to investigate the case. We can't send an investigator out without protection. He wouldn't get past the door.

And we haven't been able to protect our witnesses. We don't have any ability to protect them and to relocate them where they can survive with their families. So this small Dujail trial, which is simply to satisfy the Dawa Party -- the prime minister is a member of the Dawa Party, the Iranian Shiah party -- is not a real case. But I don't -- I've never subscribed to the death penalty, and I wouldn't subscribe to it.

BLITZER: Can there be a fair trial in these current security conditions?

CLARK: No. I was the one selected by all the defense counsel to present the security issue to the tribunal. And I fought with all my ability to get security. And we all knew from the beginning there's only one source for that security, and that's the United States government because at least all of these people who've been assassinated, these three, there have been allegations that it was the Iraqi government that did it, the Interior Ministry.

BLITZER: How scared are you, now that you're about to go back to Baghdad?

CLARK: Well, I feel pretty safe. I'm an American. I can get in and out. I don't live there. My family's not there. I don't have to worry about my family. And I think my chances are very good. The ones I've always worried about, and you have to worry about, are the Iraqis lawyers. How are they going to survive? BLITZER: And is there one specific piece of hope that you have for those Iraqi lawyers? What are you appealing to the U.S. government for?

CLARK: Well, you know, since Khamis was murdered -- I mean, we've been living together. We live in a little prison thing there within the wall during trial. He goes home when we're not in trial to stay with his family. He's got six children, his youngest child not 3 years old yet. Of course, they've got no father now.

But I feel safe there. I don't think they are safe there. I don't think they'll be safe there until the United States agrees to relocate their families, provide them with a means of surviving where they're relocated until they can do it on their own, protect their husbands while they're engaged there, provide them with investigators who are safe themselves to go to Dujail and to go to the Anfal territories in Kurdistan and investigate.

BLITZER: We're almost out of time. But I want to go through that Anfal campaign, which is the next trial that's supposed to start in August. The organization Human Rights Watch, which you're familiar with, in 1993 they had their report on the Anfal campaign.

They said Saddam Hussein's government was involved in mass executions and disappearances; 50,000 people, 200,000 people in the Kurdish areas. There was widespread use of chemical weapons, destruction of 2,000 villages, arbitrary jailing of tens of thousands of women, children, and elderly, forced displacement of hundreds of thousands of Kurdish villagers, that according to Human Rights Watch.

And they concluded this: "While it would be unrealistic to expect President Saddam Hussein to put himself and his closest aides and relatives on trial, a successor government in Baghdad should not shirk from its responsibility to carry out a thoroughgoing investigation of these enormous crimes and prosecute all those involved to the full extent of the law." That's Human Rights Watch, a group I'm sure you know something about. What do you make of it?

CLARK: I know them very well. I think they're wrong, and I think in hindsight, they would realize they're wrong, that you can't have a fair trial there because security doesn't permit it. And that's what we insisted upon in November of '05. You can't have a fair trial when your lawyers are getting killed, when you can't investigate your case, and you can't go forward. And that's very obvious.

If you're going to have a fair trial, you've got to have safety for everybody involved. And you don't have that. And we shouldn't presume innocence -- the Defense Intelligence Agency, the DIA, the Central Intelligence Agency, the CIA, and the U.S. Marine Corps have all said that Iraq did not have gasses that were used in Anfal and or in Halabja. And they've said that in the "New York Times" and every place else. So we'd better wait and assume innocence.

I think the presumption of innocence is not a technical rule of evidence, it's a way of life. You'd better keep your mind open. You'd better not be prejudiced if you want to survive in this life because you're creating prejudice and hatred by threats of execution and by unfair trials.

BLITZER: Ramsey Clark, good luck when you go back to Iraq. Be careful over there. Thanks for coming in.

CLARK: Thank you.

(END VIDEOTAPE)

ANNOUNCER: This is CNN breaking news.

BLITZER: Israeli forces are moving into the Gaza Strip right now. We're getting word and we're getting live pictures in from the southern part of Gaza. Israeli troops moving in. There has been escalated tension in recent weeks building up over the past few days to the kidnapping of one Israeli soldier at a checkpoint inside Israel, along the border with Gaza.

Two other Israeli soldiers were killed in that incident. The Israelis have been negotiating to try to get their captive soldier returned. That has not happened. Paula Hancocks is joining us on the phone from Jerusalem. A lot of people have been bracing for the planes and the tanks by the Israelis to move into Gaza. That's precisely, Paula, I take it what's happening right now?

PAULA HANCOCKS, CNN CORRESPONDENT (on phone): That's right, Wolf. Yes, this is a scenario that Prime Minister Ehud Olmert had threatened would happen if the Palestinian militants did not hand back the Israeli soldier they kidnapped on Sunday.

Now they have not handed that soldier back and the troops that we can see now are moving into the southern part of Gaza. Now for a couple days, we have seen thousands of the Israeli ground troops, tanks, armored vehicles, all lining up on the border getting ready for either the order to go into Gaza or to retreat.

Obviously that order has come in that they will go into Gaza. Now we're hearing from the Palestinian security officials people that the ground troops are taking up positions around the town or Rafah. Now this is right from the southern tip of Gaza, very close to the Egyptian border.

And we understand that these troops are amassing around that particular area itself. We also know in the past couple of hours in preparation presumably for this particular incursion, air strikes have been carried out by the Israeli air force. They have taken out two bridges which join up the northern and southern parts of Gaza. So they have basically isolated the northern and southern parts of Gaza.

And in addition, they've taken out the one and only power plant in Gaza as well. So the Israelis making sure that power had been taken out for much of Gaza -- Wolf?

BLITZER: Are Israeli officials, Paula, suggesting that they are going to re-occupy parts of Gaza right now? As you know and as our viewers know, the Israelis withdrew from Gaza last year under a very controversial plan. Are they going to stay there or is this simply effort to try to free that Israeli soldier?

HANCOCKS: Well this is something that Israeli politicians have been very, very clear about all of Tuesday or Monday. Every single time we have spoken to them, they have emphasized they do not want to reoccupy Gaza. They have said they left Gaza unilaterally last summer, but they do not want to reoccupy the territory.

Now what we've been hearing from Ehud Olmert, the prime minister, is they want to go back in to try and find their soldier. Now we've heard from Israeli intelligence sources earlier on Tuesday that they did believe that Gilad Shalit, the soldier who was kidnapped, was actually being held in southern Gaza.

They also said, these intelligence sources, that they were worried the militants would try and move him so it's more difficult for the Israeli intelligence to pinpoint him. So the fact that these forces are going into southern Gaza itself and around the area of Rafah, which is very close to the Egyptian border, would suggest that they may have intelligence that they may know exactly where he is. It's almost as if they're going in solely find this soldier.

BLITZER: Because we have been reporting earlier that the Israelis believe this soldier was being held in Khan Younis, which is in the southern part of Gaza, not part from Rafah. Apparently this area where the Israelis are moving in right now. We're showing our viewers, Paula, some video of fires that have started in parts of Gaza. These are pictures that we have recently gotten in. I understand -- I believe these fires started from the Israeli air strikes, but maybe you can update our viewers on what you're hearing.

HANCOCKS: Well there are fires in the northern part and the central part of Gaza. Now the main fire we do know about, and you've seen dramatic pictures of, is the power plant itself. Now Israeli air forces have been sending missiles directly at that power plant. They wanted to knock out the power for the majority of Gaza. And they succeeded in locking out power, certainly for northern and central Gaza and also they did knock out two bridges just a few hours ago, as well to isolate northern and southern Gaza. So those would probably be the pictures you're looking at. And the biggest fire we have seen would have been from that power plan itself.

BLITZER: And we're trying to connect with our John Vause, Paula. He's in Gaza City right now. We hope to connect with him shortly and get the word on what's happening inside Gaza right now.

A lot of this escalated with these rockets that Palestinians were launching from inside Gaza into Israel, including in one town called Sderot. This is seen as the major reason why the Israeli government, I take it, has decided to move in in additions to the taking of this one Israeli soldier.

HANCOCKS: That's right. The Israeli politicians have been saying for some time that they were going to act against these rockets. They're basically rockets, homemade rockets in many cases, that Palestinian militants have been launching from Gaza into Israel proper in particular a town called Sderot, a small town which is just on the border with Israel.

Now there have been no deaths caused by these rockets. There have been some light injuries. But there have been something like 200 rockets sent in just the past few weeks. Now this is something that Israeli politicians have been criticized for as well, the fact that they have not acted on this earlier. Now this is the reason they carry out many air strikes in the past few weeks to try and stop these militants from sending missiles into Israel. And of course as you know, in the past few weeks, they have had a couple of air strikes which have wronged, they have missed the militants they were targeting and have killed Palestinian civilians, Wolf.

BLITZER: I take it it's approaching, what 3:00 a.m. in Israel right now? A lot of speculation earlier in the day, Paula, that the Israelis probably would wait until daybreak. It's still the middle of the night, it's still very dark over there, but apparently the tanks are rolling in to Gaza, the southern part of Gaza. The air strike started a couple hours ago. Is that what all the military analysts in Israel were anticipating?

HANCOCKS: Well to be honest, they were pretty much split. Everybody said at the beginning that they would probably want to go and launch this offensive at nighttime because they would have the element of surprise. But of course Prime Minister Ehud Olmert has had these tanks on show. He has wanted to show the Israeli might. He has wanted to show that these tanks were ready to go into Gaza to try and increase the intensity of these negotiations to find his Israeli soldier.

Of course the element of surprise was lost. So I think what may have been the case is maybe the Israelis just realized that the negotiations were not going anywhere. Ehud Olmert was under pressure not to appear weak to the international community, not to appear weak to the Hamas military wing and the political wing. And he has been saying earlier on, on Tuesday, that time is running out for negotiations. And if you had to, if you had no evidence of the soldier or the soldier being released, he would launch a military offensive and that's what we're seeing now.

BLITZER: And Paula, we should give our viewers some perspective. This Gaza Strip, this area, it's a tiny sliver of land. It's not much bigger than the District of Columbia along the Mediterranean coast. But in that tiny sliver are more than a million, a million and a half Palestinians are cramped, they're crowded, they live -- many of them, under miserable conditions. Many of them living in extreme poverty. Unemployment is huge in Gaza. So this is not a vacant area. This is a tiny area that's concentrated with what, about a million and a half Palestinians, is that right?

HANCOCKS: That's right. This is one of the most densely populated areas on earth. There are -- the houses that many of the Palestinian live in, it would not be unusual for maybe 10, 15 to be living in one house. These are families and extended families all live together. And also there are a tremendous amount of refugee camps in Gaza itself. The United Nations is the main agency, the main aid agency down there. And there's a tremendous amount of people working for the U.N. because there is such a need for Palestinians in refugee camps and also Palestinians who are not, and have their own houses to have help. So it;s a poor area and it's a very densely populated area. I think those living under the poverty line is something like two thirds in Gaza. So any air strikes and any ground offensives that the Israelis launch has to be incredibly accurate because if it's not accurate, then there will be civilian casualties.

BLITZER: Paula, stand by for a moment. Aaron David Miller is on the phone, a former U.S. State Department diplomat, was involved in Middle East negotiations for at least two decades.

He's joining us on the phone. Aaron, give us some sense of what this means, Israeli tanks rolling into the southern part of Gaza. Air strikes taking out a major power center in Gaza. It looks like this situation is deteriorating rapidly.

AARON DAVID MILLER, FORMER STATE DEPARTMENT DIPLOMAT: Oh, it's deteriorating all right. The question is what are the objectives and the motivations of the Israeli moves. Clearly if the Israelis had intelligence indicating where this soldier was, I doubt frankly whether they would be launching these sorts of operations in order to retrieve him.

So this may well be an effort, as taking out the bridges were, in an effort to seal escape routes, up the psychological pressure on Palestinians. But ultimately, it seems to me, in a small, enclosed area with over a million people, more than a million, one of the highly -- most highly-densely populated areas in the world, it's been extremely difficult without extremely reliable information and inside help for the Israelis to launch a successful operation to retrieve the kidnapped soldiers.

This, it seems to me, is an effort to increase psychological pressure, demonstrate their seriousness and purpose to the Palestinians. But I doubt, frankly, whether it's the beginning of a rescue operation.

BLITZER: There was some suggestion, Aaron, that the president of the Palestinian Authority, Mahmoud Abbas, was actually trying to get this Israeli soldier released, but was getting resistance from the Hamas-led prime minister and the government of the Palestinian Authority. What can you tell us about that?

MILLER: I mean, I think it's clear that there is a split, that this operation was probably sanctioned by Khaled Mashal in Damascus, Hamas' external leadership, that it was carried out by a cell in Gaza, which is loyal to the kind of military operations that Hamas has been conducting over the years.

It may well be that Haniyeh didn't even know about it.

Mahmoud Abbas's problem, Wolf, right now is the following: His timing is awful. He has negotiated clearly some sort of national unity government with Hamas as a sign of seriousness, in an effort to moderate their views at the very moment when Hamas' military wing has carried out an operation which fundamentally undermines the purpose of what Mahmoud Abbas is doing. So you have a very confused Palestinian response. It puts Hamas in an impossible situation. It puts Abbas in an impossible situation. And the Israelis are upping the pressure in an effort to achieve what it seems to me is now their overriding purpose: The return of this soldier unharmed.

BLITZER: Aaron Miller, thanks very much for joining us. Paula, stand by. We're going to continue to follow this story, Israeli tanks moving into Gaza right now. These comes a couple of hours after Israeli warplanes began air strikes against specific targets. The purpose ostensibly to find this one Israeli soldier taken kidnap over -- kidnapped over the weekend by Palestinians.

We will stay on top of this story, bring you the latest. Stay with CNN for all of this breaking news.

Also coming up tonight, billion-dollar fraud. Yes, billion- dollar fraud. The second wave of disaster after Hurricane Katrina. Find out where your hard-earned money actually went. Stay with us.

(COMMERCIAL BREAK)

BLITZER: No matter where you live, you may still be feeling the impact of Hurricane Katrina. We're learning more and more about fraud stemming from the disaster and just how much it's costing every American taxpayer. CNN's Tom Foreman is here in THE SITUATION ROOM with these stunning details -- Tom.

TOM FOREMAN, CNN CORRESPONDENT: You know, when you're a kid, they tell you not to pile on in a fight, but every report that comes out about Katrina and the money that has been spent on it, it seems like people are piling on, because they all come up with the same thing. The amount of your tax dollars going into this that is being lost to either mismanagement, misspending or fraud is simply staggering.

(BEGIN VIDEOTAPE)

FOREMAN (voice-over): Ten months after Katrina, the biggest storm of modern times is still claiming victims. Among them, American taxpayers. The amount of fraud and waste taking tax dollars is estimated now at close to $1.5 billion. Despite numerous reports from various government agencies, watchdog groups say they're not yet convinced the situation is under control.

SCOTT AMEY, PROJECT ON GOVT. OVERSIGHT: The real question is, are they doing a good job, and I think as we're seeing from these reports that there are a lot of things that need to be corrected.

FOREMAN: "The New York Times" has rolled out the latest tally of abuses, and it is staggering. Among them, almost $8 million spent to renovate a military base in Alabama that ended up housing fewer than a dozen people. About $400 million worth of trailers that are still sitting empty. And literally thousands of cases of suspected fraud, people submitting bills for recovery work they did not do, for losses of homes, cars, businesses, even children that that they apparently never had.

SEN. SUSAN COLLINS (R), MAINE: The magnitude is just incredible, and it seems to be a bottomless pit.

(END VIDEOTAPE)

FOREMAN: And that seems to be the fundamental problem, that it does seem to be a bottomless pit.

I talked to the people over at FEMA today, and they seem to be very well-intentioned about this. They have been looking at it for months. They've put a number of steps in place which are supposed to address all of these issues that should require better identification of people. For example, prisoners who laid claim to needing rental assistance, this sort of thing, people who were in jail the whole time. A system that would better track where the money goes, how much money goes out to whom, and systems to recover what was taken.

The question is, will it really work? Now we have a new hurricane season. I guess we'll find out.

BLITZER: Tom, thanks very much for that. Let's go to Jack in New York -- Jack.

CAFFERTY: A new surgeon general's report found only smoke-free buildings and public places truly protect nonsmokers from the hazards of secondhand smoke. The question is, is enough being done to protect nonsmokers from secondhand smoke?

Lynn in Highlands Ranch, Colorado: "Good grief, there are enough things to worry about that are more crucial than someone getting smoke blown in their face. In Colorado, we have done about everything to protect nonsmokers short of telling them they can't smoke in their own homes. Who's protecting the smokers' right to have a cigarette?"

Diana in Torrington, Connecticut: "In the past year, two of my under-50-year-old friend who were nonsmokers died of lung cancer. Clearly, we're not doing enough."

Suzanne in Rochester, New York: "If you live with a heavy smoker for 30 years, yes, I believe your health would be adversely affected. But not through very limited exposure. Life is full of risks of all kinds. Sorry, but this is just more evidence of the nanny state."

Cheryl in my home town of Reno, Nevada: "Dear Jack, I live in Nevada, one of the most backward states in the union when it comes to protecting the health of its citizens. If you don't like secondhand smoke, complain, complain, complain to the business which you are giving your money to. I do. Eventually, they'll listen."

Omar, Richmond, Virginia: "Not nearly enough is being done. More often than not, the choice of a night on the town requires breathing in other people's smoke, especially here in Richmond, tobacco capital of the world. I know of someone who was just diagnosed with lung cancer at the age of 23. He's never smoked in his life, but he did frequent nightclubs."

And Betty the Smoker writes: "Jack, you've just ruined my day. I quit smoking last October after smoking for 45 years. I'll probably be in withdrawal forever. Some of my most enjoyable moments are when I can stand downwind of someone else who is smoking." Wolf.

BLITZER: Jack, see you tomorrow. Thanks very much.

Up next, "PAULA ZAHN NOW."

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