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State Department Says Iran's Nuclear Offer Falls Short; House Panel Says Iran Has Key Ingredients for 12 Bombs; Syrian President Says Border Deployment Would Be Considered Hostile

Aired August 23, 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: Thanks, Kitty. And to our viewers, you're in THE SITUATION ROOM where new pictures and information are arriving all the time. Standing by CNN reporters across the United States and around the world to bring you tonight's top stories.
Happening now, the Bush administration says Iran's nuclear offer isn't good enough. And a congressional panel now warning tonight of an Iranian threat. It's 2:30 a.m. in Tehran. Are Iranian war games a prelude to the real thing?

Democrats have a different approach to war and terrorism, but can they turn that into a political advantage? I'll speak to the Democrat National Committee chairman, Howard Dean.

And he spent his time at the soccer field and the local mosque. How did a shy quiet boy turn into the world's most wanted terrorist, a special preview of CNN's powerful new documentary "In the Footsteps of bin Laden."

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

Is this stage now set for a showdown with Iran? The Bush administration is taking a dim view of Iran's response to incentives aimed at halting its nuclear program. It now says that response quote "falls short of the United Nations demands" and there are new warnings here tonight in Washington about an Iranian threat.

Let's bring in CNN's Brian Todd. He's watching this story -- Brian.

BRIAN TODD, CNN CORRESPONDENT: Wolf, with another deadline approaching for Iran to verify that it's suspending its nuclear activities, there are new details tonight on Tehran's weapons' ambitions and some exasperation from the leaders on Capitol Hill who put out that information.

(BEGIN VIDEOTAPE)

TODD (voice-over): From key intelligence leaders in Congress, new warnings on Iran while the regime weighs incentive packages and a deadline for suspending nuclear enrichment. They sat Teheran is also playing a familiar and dangerous game.

UNIDENTIFIED MALE: It's beyond a shadow of a doubt for me that they are trying to stall for more time to continue their uranium enrichment and the building of their nuclear program.

TODD: Congressman Mike Rogers says western leaders have been duped by Iranian diplomacy for the past three years. Rogers is a key player in the House Intelligence Committee's new report on Iran's strategic threat to the U.S. and its allies.

REP. MICHAEL ROGERS (R), INTELLIGENCE COMMITTEE: These folks are absolutely up to no good. They're developing ballistic missiles. They're developing and trying to enrich uranium. They have chemical and biological weapons programs.

TODD: Information that's not new but does raise new questions about Iran's intention at this crucial moment in diplomacy. For instance, the report says the regime has produced enough of a compound called uranium hexafluoride (ph) to produce 12 nuclear bombs if it's enriched to weapons grade.

Still, U.S. intelligence leaders and outside experts have repeatedly said Iran likely won't be able to produce a nuclear weapon for at least four years. Ready now, a delivery system for any nuclear weapon. What the report calls the largest inventory of ballistic missiles in the Middle East, a capability that experts say is rapidly being developed further.

JOHN PIKE, GLOBALSECURITY.ORG: The Shahab three (ph), which is currently operational has a range of 2,000 kilometers, can get to Israel. Shahab four (ph), twice the range, 4,000 kilometers can get too much of western Europe. The Shahab five (ph) also under develop could get all the way to the United States but they're years away from having that capability.

(END VIDEOTAPE)

TODD: And specifically, between four and 10 years for those two longer range missiles, according to John Pike. Now after repeating called and e-mails, a top Iranian official at the United Nations told me he needed more time to read the U.S. House report, but he refuted the accusation that Iran is stalling for time on the nuclear issue and he said his government is ready to begin negotiations at any time -- Wolf.

BLITZER: All right, Brian, thank you very much. Brian Todd reporting. The United Nations is pressing Israel to lift its air and sea blockade of Lebanon, saying that's vital for relief efforts. Israel imposed the blockade during its war with Hezbollah to halt the flow of weapons and says it won't lift it until peacekeepers are deployed along the Syrian/Lebanese border crossings. That happens to be a non-starter for Syria.

Let's bring in Zain Verjee. She's watching this part of the story -- Zain.

ZAIN VERJEE, CNN ANCHOR: Wolf, no troops, no way. That's the message from Syria's president, Bashar Al-Assad, in an interview broadcast on Dubai TV. Assad says Syria will not accept international troops stationed on the Lebanese/Syrian border. He says it would be a withdrawal of Lebanese sovereignty and a hostile position.

(BEGIN VIDEO CLIP)

PRES. BASHAR AL-ASSAD, SYRIA (through translator): This means create a state of hostility between Lebanon and Syria. There is no country in the world that would agree to put on its borders foreign soldiers unless there's a war.

(END VIDEO CLIP)

VERJEE: Israel wants a 15,000 strong United Nations force with a powerful mandate policing the area to keep the shaky peace and to cut off Hezbollah's weapon supplies. Israel says it comes over the Syrian border. Now in the interview, Wolf, Bashar Al-Assad went on to say Hezbollah's victory was enough to teach Israel a lesson and that the isolation of Syria has failed.

Bashar Al-Assad also says the time to clinch a peace deal in the Middle East is now before the window of opportunity closes in the coming weeks or months. Now Syria says it is willing to talk. Washington has expressed frustration with Syria, accusing it of backing Hezbollah and for protecting Hamas leaders exiled in Damascus. Israeli Prime Minister Ehud Olmert has said that he's not talking peace with Syria at all until it stops backing Hezbollah -- Wolf.

BLITZER: Zain thanks very much. That cease-fire between Israel and Hezbollah very, very shaky right now.

The U.S. strategy for victory in Iraq comes down to ending the sectarian violence especially in and around the capital of Baghdad. That's where Sunni and Shiite militias are battling on a daily basis and preventing the U.S. troops from leaving Iraq, but is the strategy working?

Let's bring in our senior Pentagon correspondent Jamie McIntyre -- Jamie.

JAMIE MCINTYRE, CNN SR. PENTAGON CORRESPONDENT: Well Wolf, when it comes to what is now being called the battle of Baghdad, the Pentagon claims that the new infusion of 12,000 additional forces, including several thousand U.S. troops is turning the tide in the Iraqi capital.

(BEGIN VIDEO CLIP)

BRIG. GEN. MICHAEL BARBERO, U.S. ARMY: Over the last five weeks, the number of incidents of sectarian violence have dropped steadily. Over the last three weeks the number of attacks on infrastructure have dropped.

(END VIDEO CLIP)

MCINTYRE: That may be but the U.S. ambassador to Iraq, Zalmay Khalilzad, writing in "The Wall Street Journal" cites a 10 percent jump last month in the already high number of violent incidents in Baghdad and notes that of the 2,100 Iraqi deaths there in July, 77 percent were due to sectarian violence, a trend he called especially troubling.

Still in a radio interview earlier this week, Defense Secretary Donald Rumsfeld continued to argue that Iraq had not yet descended into a civil war. That was hotly disputed by Ken Pollock (ph) of the Brookings Institution who was the co-author of a lengthy opinion piece in "The Washington Post" last Sunday. He argued that the only thing standing between Iraq and the descent and the total devastation are the 135,000 U.S. troops there.

The Pentagon says that 90 percent of the sectarian violence is within a 30 mile radius of Baghdad and that 82 percent of the incidents are confined to just four of Iraq's 18 provinces, but are the U.S. and Iraqi government forces winning the battle of Baghdad? Well the general briefing today at the Pentagon said that while he's cautiously optimistic, it's too soon to tell -- Wolf.

BLITZER: And for those provinces, as you well know, Jamie, happen to be where most of the people in Iraq live, most of the millions there. Jamie McIntyre, thanks very much.

Jack Cafferty lives in and around New York City. He's joining us from New York, not going to disclose your real residence, Jack.

JACK CAFFERTY, CNN ANCHOR: Well some people think it's Mars. I live in the garden state, New Jersey. Wolf, it's not like the Republicans don't have enough trouble heading into these mid term elections. Check out these three clowns.

We bring you Curly, Moe, and Larry, Republicans all. Curly is Montana Senator Conrad Burns. There's a new video out showing Burns saying quote "Here goes a nice little Guatemalan man who's doing some painting for me." And then joking that he might be in the country illegally.

Moe is Florida Congressional candidate Tramm Hudson (ph),who earlier this year said quote "I grew up in Alabama and I understand and I know this from my own experiences that blacks aren't the best swimmers or may not even know how to swim."

And Larry is Senator George Allen who's up for reelection in Virginia. He of course said to arrivals volunteer of Indian descent quote "Let's give a welcome to Macaca here. Welcome to America and the real world of Virginia."

President Bush thinks Larry is a great guy. He's campaigning for Allen in Virginia today. So here's the question. You can have a little fun with this. Why do some politicians insist on sticking their feet in their mouths? Email us at CaffertyFile@CNN.com or go to CNN.com/CaffertyFile -- Wolf. They are amusing, Wolf.

BLITZER: Thanks, Jack, for that. Indeed they often are. Coming up, journalists held hostage and today a video demand from their captors. We're going to speak with the Reverend Jesse Jackson. He's going to the Middle East. He's going to work on the issue of getting prisoners and hostages released.

Also, fear in flying, a Northwest flight turns around, F-16s scramble, 12 men arrested. Find out why the pilot radioed for an emergency landing.

Kid terrorists, a rare look at Osama bin Laden growing up. Find out more about the world's most wanted man. CNN is counting down to the debut of "In the Footsteps of Bin Laden", a CNN special -- CNN PRESENTS special, two-hour investigation. That airs 9:00 p.m. Eastern tonight, about an hour and a half from now or so.

Stay with us. You're in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: Welcome back. At 9:00 p.m. Eastern tonight, CNN will air a powerful new documentary about the world's more notorious terrorist. In this special excerpt our chief international correspondent, Christiana Amanpour, looks at Osama bin Laden as a boy who is described as shy and quiet.

(BEGIN VIDEOTAPE)

UNIDENTIFIED MALE: (INAUDIBLE) I met Osama bin Laden in the early 1970's when we lived in this neighborhood.

CHRISTIANE AMANPOUR, CNN CHIEF INTERNATIONAL CORRESPONDENT (voice-over): This nondescript middle class Jeddah (ph) neighborhood is where Batarfi, then age 12, and bin Laden, three years older, became neighbors and best friends. Going to the mosque together, playing together. But Batarfi took us to the field where he and bin Laden played soccer as teenagers.

UNIDENTIFIED MALE: And just looking at (INAUDIBLE) a lot of memories. And I enjoyed being a captain really, telling people what to do.

AMANPOUR: On the soccer field, Batarfi was the leader, Osama the follower.

UNIDENTIFIED MALE: But I would tell him what to do and he was a good soldier. And he would follow orders. Usually because he was taller than most of us and older, he would play in the front. Because this way he could use his head to you know score.

AMANPOUR: Batarfi says the teenage Osama would usually take the high road. He remembers a time his friend was being bullied.

UNIDENTIFIED MALE: So I went running to the guy and I pushed him away from Osama. I solved problems this way, but then Osama came to me and said you know if you waited a few minutes, I would have solved the problem peacefully. So this was the kind of guy who would always think of solving problems peacefully.

AMANPOUR: While Batarfi took the lead on the playing field...

(SOUNDS)

AMANPOUR: ... when it came to religion, there was no question Osama was in charge.

(SOUNDS)

UNIDENTIFIED MALE: That's the mosque we used to pray in. Yes. Yes.

(SOUNDS)

AMANPOUR: It is something of a mystery why this son of a wealthy family was drawn to such rigid religious beliefs. Over time, Batarfi saw his best friend become even more of a fundamentalist. Striving to live according to his ultra strict interpretation of the Holy Koran.

UNIDENTIFIED MALE: No pictures, no music and after that not even TV unless there's news.

(SOUNDS)

AMANPOUR: Osama's religious devotion went beyond living a simple pias (ph) life. He had begun to believe it was his duty to prepare to one day fight for and defend Islam.

(MUSIC)

AMANPOUR: Osama's training ground, the desolate Saudi desert.

(MUSIC)

AMANPOUR: The son of a multi-millionaire was now preparing for a life without luxuries or even basic essentials. A life as a holy warrior.

UNIDENTIFIED MALE: I hear from his brothers that when they go there, they sleep on the sand. There's no blanket if it's cold and you know like soldiers.

AMANPOUR: Batarfi had no desire to join Osama's army so the two friends began to drift apart.

UNIDENTIFIED MALE: I would prefer the beach. I was more romantic. You know I was thinking of love. He was thinking of love of God.

AMANPOUR: But how did Osama bin Laden's love of God become a mission to kill?

(MUSIC)

(END VIDEOTAPE)

BLITZER: "In the Footsteps of Bin Laden", a CNN PRESENTS special two-hour investigation, airs tonight, 9:00 p.m. Eastern only, only here on CNN. You're going to want to see it tonight, all two hours.

Still to come, war, terror and politics. Howard Dean, one on one with me, right here in THE SITUATION ROOM, talk about the big issues facing Democrats in this election year. And Iran plays war games. A look at the message behind the military muscle flexing.

Stay with us. You're in THE SITUATION ROOM.

(COMMERCIAL BREAK)

(BEGIN VIDEOTAPE)

UNIDENTIFIED FEMALE: A lot of people (INAUDIBLE) them and took them away.

JEANNE MESERVE, CNN HOMELAND SECURITY CORRESPONDENT: An airline source in Amsterdam said the arrested passengers had been looking into plastic bags and pulling out cell phones, which can be used to detonate bombs. A U.S. official said some had taken out cell phones during takeoff and tried to pass them around. The official also says some of those arrested unfastened their seat bets while the seat belt sign was still illuminated. U.S. federal air marshals onboard the flight broke cover, according to the official, and took control of security while the pilot headed back to Amsterdam.

UNIDENTIFIED MALE: I was afraid.

UNIDENTIFIED MALE: Yes.

UNIDENTIFIED MALE: Yes.

UNIDENTIFIED MALE: Why?

UNIDENTIFIED MALE: (INAUDIBLE) plane. (INAUDIBLE)

MESERVE: Officials say there was no intelligence indicating the flight was at risk and they are still evaluating how big a security threat those passengers posed.

Jeanne Meserve, CNN, Washington.

(END VIDEOTAPE)

BLITZER: Still that flight was heading towards Mumbai (ph) where there was a huge terrorist attack only a few weeks ago. We'll continue to watch this story. Stay tuned to CNN day and night for the most reliable news about your security.

Just ahead, war, terror and politics, Howard Dean here in THE SITUATION ROOM. I will ask him some of the tough questions facing his party.

And then Jesse Jackson is heading to the Middle East. He's had success working on behalf of hostages in the past. Can he do it again right now? Jesse Jackson in THE SITUATION ROOM right after this break. (COMMERCIAL BREAK)

BLITZER: To our viewers, you're in THE SITUATION ROOM where new pictures and information are arriving all the time. Happening now, the Bush administration says Iran's bid for more nuclear talks falls short because it still hasn't agreed to stop enriching uranium. Iran has eight more days to suspend its nuclear activities or face possible United Nations sanctions.

New evidence of the slump -- of a slump in the housing market is adding to economic jitters tonight. Sales of existing hopes fell to a new two and a half year low last month and the inventory of unsold homes hit a record high.

New ammunition tonight in the political and ethical debate over stem cell research. A biotech company says it's found a way to make stem cells without destroying embryos. A White House spokeswoman calls it a step in the right direction.

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

Grabbed off the street in Gaza last weak, two FOX News journalists have appeared in a hostage video released by a Palestinian news agency. In a leaflet accompanying the video, a group calling itself The Holy Jihad Brigade is demanding the release of Muslim prisoners held in America. CNN's Chris Lawrence has the story from Jerusalem -- Chris.

CHRIS LAWRENCE, CNN CORRESPONDENT: Wolf, this group, The Holy Jihad Brigade, set a deadline of Saturday afternoon. The kidnappers said they would release their prisoners if the United States releases Muslim prisoners from the jails of America.

(BEGIN VIDEOTAPE)

UNIDENTIFIED MALE: I guess I would add for myself...

LAWRENCE: Journalists Steve Centanni and Olaf Wiig appear on tape pleading for freedom.

UNIDENTIFIED MALE: If you could apply any political pressure on the local government here in Gaza.

LAWRENCE: Sitting on a floor mat with no militants in sight, FOX News reporter Steve Centanni said they're being treated well.

UNIDENTIFIED MALE: We get lots of clean water, food every day.

LAWRENCE: Their families have made public pleas for their release.

UNIDENTIFIED FEMALE: I know the people of Gaza are good people and you will bring my husband home to me.

LAWRENCE: (INAUDIBLE) husband spoke directly to his family.

UNIDENTIFIED MALE: Please don't worry. I'll do all the worrying for us.

LAWRENCE: Over the past two years at least 26 foreigners have been kidnapped from Gaza, nine of them from the media. Hostages have usually been released within hours. But this kidnapping and threats of more to come caused some media to pull out of the area.

(on camera): For now, we don't go across the checkpoint. Palestinian security sources tell us an unnamed militant group is threatening to kidnap any foreign journalist caught in Gaza. The latest threat specifically targets those with U.S. or British passports.

DR. IYAD SARRAJ, PALESTINIAN ANALYST: The Palestinian Authority and the government are in such hopeless situation today, they cannot control the rule of law.

(SHOUTING)

LAWRENCE (voice-over): Some Palestinian experts say this is a direct result of Hamas' election in January. Many countries cut diplomatic ties and financial aid. That created economic and social instability, which stoked anti-western sentiment.

SARRAJ: We have opened the doors for al Qaeda or even worse.

LAWRENCE: A previously unknown militant group called the Holy Jihad Brigade claimed responsibility for this kidnapping and demanded the U.S. release Muslim prisoners from its jails within the next three days.

UNIDENTIFIED MALE: Ask you to do anything you can to try to help us get out of here.

LAWRENCE: The kidnappers make no specific statement about what they will do if their terms are not met.

(END VIDEOTAPE)

LAWRENCE: The U.S. State Department has called for the unconditional release of both journalist and says the United States will not negotiate with terrorists -- Wolf.

BLITZER: Chris Lawrence in Jerusalem for us, thank you. The Reverend Jesse Jackson now is set to return to the Middle East on the heels of the month-long war between Israel and Hezbollah. The former Democratic presidential candidate is no stranger to the region or to the conflicts involving captives.

In the past, Jackson has successfully negotiated the release of Americans and others held hostage or prisoner in Iraq and Syria, as well as in Cuba and Yugoslavia.

Reverend Jackson, thanks very much for coming in. Why are you going to the Middle East this time?

REV. JESSE JACKSON, PRES., RAINBOW PUSH COALITION: We've been invited by religious leaders there to bring a delegation to meet with them really for three things: one, to expand the cease-fire and assure its continuation; secondly, humanitarian relief for those in Lebanon and Haifa who have been hit by bombs; and, thirdly, to make moral appeal and inquiry to those who are held captive.

We feel that if those who are held captive -- we're able to know what their status -- are they dead or alive, whether they are the Israeli soldiers or whether they are the Fox News reporters, or whether they are Lebanese. We want to make inquiry about them. And we would think that in this mission, if we are successful in raising these issues, that we will have some positive impact upon an outcome.

BLITZER: You've been successful in the past. Do you have a green light to do this from the U.S. government, from the Bush administration?

JACKSON: We certainly have called the State Department, not yet talked with them today. But, you know, in this instance, we all agree, whether it's the U.S. government that, A, that the cease-fire should be continued and expanded. We all agree that there should be humanitarian relief. We all agree there should be inquiry about whether there are captives and ought to be, if possible, set free.

So I would think that there's no contentiousness in our position. We have talked with the governments of Syria and Lebanon and Israel. And while we are not representing a government, there's a kind of shared concern that we, in fact, do the best that we can do for the humanitarian mission that we're embarking upon and to make inquiry about those who are held captive.

For example, the three Israeli soldiers. It's not known whether they are dead or alive, for example. Their status is important. Their release would be the ultimate deal but, Wolf, we do not know what their status is. The Fox News reporters who are someplace, perhaps, in Gaza.

And while going to Syria first, we intend to reach out through President Assad. I think he may be the strongest force in the region in so many ways because Syria is communicating with Hamas and Hezbollah and Iran and Lebanon, and so that's why we need to figure out some way to begin to talk to Syria more direct and not -- the no- talk policy is not in our interest.

BLITZER: Will you be meeting with Bashar al-Assad, the leader of Syria?

JACKSON: I don't know who we'll meet with at this point. And I wouldn't want to preempt who we might meet with by saying it today. Suffice it to say we're meeting with religious leaders in Syria and Lebanon and Israel. We're meeting with the political leadership, meeting with Assad, with Mr. Assad, on Monday. We're going to meet with political leadership in the three countries as well.

BLITZER: What about Hezbollah?

JACKSON: And we hope that our... (CROSSTALK)

BLITZER: Presumably, Hezbollah is holding those two Israeli soldiers that were kidnapped back on July 12. Presumably, some group in Gaza is holding that Israeli corporal who has been held even longer. Will you meet with Hezbollah and Hamas leaders?

JACKSON: We will meet with whoever we have to meet with to seek to ease the tensions. If we can meet with those forces to get the captives set free, then we would do just that.

But, as for now, we're making an inquiry as to their status. And we hope that our moral appeal will not fall on deaf ears.

BLITZER: Will you make a moral appeal to the Israelis to release Lebanese or Palestinian prisoners, in exchange for the release of the Israeli soldiers?

JACKSON: You know, I do not want to get into the politics of negotiating exchanges, because that's a very intricate situation.

And that's why ours is a humanitarian mission. That's why ours is extend the -- expand the cease-fire, or relief for those who are victims of the war, and to make the moral appeal.

If our appeal is successful, then, those who do negotiate can then negotiate. But, as for right now, those who do negotiate do not know the status of those who are held captive. And, so, I don't want to go -- take it to that level yet, Wolf.

BLITZER: What about Iran? Iran, by all accounts, seems to have a lot of influence right now with Hezbollah, with Hamas. Any plans to visit Tehran, to meet with the leadership there?

JACKSON: I do not now, but I will meet with them. We should talk with Iran or -- and Syria.

All relevant forces, it is in our interest -- we should talk even to our adversaries, unconditionally, and agree conditionally. So, whether it is Iran or Syria, or Hamas, or Hezbollah, better we talk, talk, talk, than fight, fight, fight.

And, if we can talk, we can leverage influence. Right now, we cannot talk. We cannot neutralize. We cannot leverage influence. We must have a different view of how we relate to people in the world.

And I think we have that power, but we're not using it. Right now, we're playing cards with too many cards out of -- out of the deck. We have more power than we're using, effectively.

BLITZER: Reverend Jackson, good luck to you on your mission. Come home safe and sound. Be careful out there.

JACKSON: Thank you.

(END VIDEOTAPE) BLITZER: And we'll see what the Reverend Jesse Jackson can do when he heads to the Middle East in the coming days. Will those American journalists be freed? The American and the New Zealander. Also, what about the Israeli soldiers and Palestinian and Lebanese prisoners? Jesse Jackson heading to the Middle East.

Up ahead tonight, changing perceptions. We'll talk with the Democratic Party Chairman Howard Dean about the war on terror and why Democrats are perceived as soft when it comes to that war.

Then, heroic robots. We'll introduce you to the future stars of search and rescue. Stay with us, you're in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: The war in Iraq, the war on terror. Maybe the stuff political futures or swan songs are made of. Let's get the Democratic perspective from the politics of terror from the party's top man.

(BEGIN VIDEOTAPE)

BLITZER: Joining us now in Burlington, Vermont, is the Democratic National Committee chairman, Howard Dean.

Governor, thanks very much for coming in.

HOWARD DEAN, DNC CHAIRMAN: Thanks for having me on, Wolf.

BLITZER: We know that since 9/11, in 2002, in the elections, 2004, in the elections, the Republicans did very well with the issue of the war on terrorism. And in our latest CNN poll that's out this week, we asked, "Which party is doing a better job dealing with terrorism?" Forty-eight percent of the American people said Republicans, 38 percent said Democrats.

You've still got a 10-point spread here. You've got a major problem.

DEAN: I don't think so. It's essentially even. The poll numbers jumped after the British caught the potential bombers in the airlines.

But the fact is, for the last year and a half, the president hasn't had anything like the numbers that he had during the 2004 election. Fifty-four percent, same poll, don't believe the president is telling the truth. Sixty-one percent think the war is a mistake and we shouldn't be there.

So, I think this president is in deep trouble. Although, I have to say that the Iraq war is an issue that's getting him into deep trouble, but the issue that really got him into deep trouble, the anniversary is at the end of this week, and that's Hurricane Katrina.

BLITZER: You think that was a bigger problem for the president...

DEAN: I think the president...

BLITZER: ... the way his administration dealt with Katrina...

DEAN: Yes.

BLITZER: ... as opposed to the way the administration has dealt with the war in Iraq?

DEAN: I do. I think Katrina -- the response to Katrina was effectively the end to the president's presidency in the sense that people all of a sudden saw the small man behind the curtain.

People in America and throughout the rest of the world for a long time have believed that Americans can fix anything, that we're better organized and better managed -- managed better than anybody, and that if something really awful happens, call on the Americans. For the first time in our lifetimes and in the world's life times, since before World War II, since before World War II, we suddenly saw an American president just descend into failure and I don't think he's ever recovered from that.

BLITZER: Here's what the president said earlier this week, when it comes to the difference between, what he said were Democrat's views on Iraq and what his position is, listen to what he said.

(BEGIN VIDEO CLIP)

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: There's a fundamental difference between many of the Democrats and my party. That is, they want to leave before the job is completed in Iraq. And again I repeat. These are descent people. They're just as American as I am. I just happen to strongly disagree with them. It's very important for the American people to understand the consequences of leaving Iraq before the job is done.

(END VIDEO CLIP)

BLITZER: That's translating by a lot Republican politicians into charges of cut and run, that that's what you want to do and basically give up any hope for trying to deal with the situation in Iraq.

DEAN: This is exactly what was going on in Vietnam and the president and the vice president are saying exactly what Richard Nixon and Spiro Agnew said again and again and again. It resulted in 25,000 more Americans being killed in Vietnam and the result was the same as it would have been had we left earlier. This is wishful thinking on the part of president. They never thought this out.

I can remember the secretary of defense saying the whole war would be paid for by Iraqi oil. The vice president was saying we would be greeted as liberators. These folks are fundamentally out of touch with what's going on in Iraq and they are fundamentally out of touch with needs of the American people and we need a new direction in this country and we're going to have a new direction after November.

BLITZER: But as you know, a lot Democrats, especially Democratic senators are also saying the U.S. should try to finish the job and not set an artificial deadline for getting out.

DEAN: The job was finished. We went in there to get rid of Saddam Hussein, we got rid of him. Then we decided we were going to occupy the country and then we decided that we would try to mitigate a civil war, which we're now in. The problem is the job, as far as the president keeps defining it, is a moving target. He doesn't know what the job is. He doesn't know what the end point is. The idea that we are going to have a democracy that looks like America was a ridiculous, right wing, intellectual idea from the beginning.

The neo-conservatives, they are out of touch. Most of them never served in the army and the ones that have have rarely served abroad defending the country. What they should have done is listened to the people that actually served abroad. Listen to the military people, do what the military suggested. The difference between the Democrats and the Republicans is not that we're not both tough, we are. But the Democrats will be tough and smart. That means we are going to listen to the people who know what they're talking about before we commit troops

BLITZER: When it comes to this issue, Senator Joe Lieberman clearly disagrees with you and, in part, that helped explain why he lost the Democratic primary in his home state of Connecticut. I interviewed him here in THE SITUATION ROOM yesterday. Listen to this exchange I had with Senator Lieberman.

(BEGIN VIDEO CLIP)

BLITZER: Are you telling us, can you look into the camera and tell the people of Connecticut once and for all, you would not then join the Republican caucus.

SEN. JOE LIEBERMAN (D), CONNECTICUT: That's absolutely what I've said. Are you representing the Republicans here today.

BLITZER: I'm asking the questions.

LIEBERMAN: No, the answer is I have made that clear.

BLITZER: So there's no chance that you would side with the Republicans even though you would become a chairman, potentially, of a committee.

LIEBERMAN: No, I am a Democrat and I will remain a Democrat.

(END VIDEO CLIP)

BLITZER: Now you're a Democrat too Governor Dean. It looks like there's a win-win potentially for the Democrats. If Ned Lamont wins, he's a Democrat, if Joe Lieberman wins, he says he's a Democrat.

DEAN: Look, I'm the chairman of the Democratic Party. The Democratic voters in Connecticut chose Ned Lamont, who is a very capable, very smart guy, who is moving forward and looking for a new direction in America and I'm 100 percent supporting Ned Lamont. I'm going to campaign with him. We are going to help him in every way possible. We believe that the voters have spoken. When the voters speak, you have to honor that in politics.

BLITZER: If he's elected, the Senator, if he's reelected, would you like him to remain in the Democratic caucus in the U.S. Senate?

DEAN: Sure. We want to be a big tent and Joe has served the country honorably, but Joe is the past and Ned Lamont is the future and we need a new direction in this country and the voters of Connecticut have indicated that.

BLITZER: In this most recent "USA Today"/Gallup poll, the generic question among registered voters, you're choice for Congress, it looks neck and neck, 47 percent Democrat, 45 percent Republican. We had a poll earlier which did show a significant Democratic preference, 52 to 43 percent. What do you make of this more recent "USA Today"/Gallup poll?

DEAN: Well there was a "New York Times" poll that also showed that the gap was much wider than that. In the end, as you very well know, the polls right now are relatively unimportant. There's only one poll that really matters and that's the one on November 7th. So. we'll see what the polls show then. But I think if the election were held today, the Democrats would win. But the election's not going to be held today and we have a lot of work to do.

The country fundamentally wants a different direction. The Republicans are just going to give us more of the same. We want a new direction in the economy and we want a new direction in health care, we want a new direction in foreign policy, we want a new direction in Iraq, we want a new direction for gas prices. We need a new direction. You can't get that by voting for Republicans.

BLITZER: We will have you back soon Governor, thanks very much.

DEAN: Thanks, Wolf.

BLITZER: And we invited Republican Party chairman Ken Mehlman to be our guest as well. He is going to be with us tomorrow, right here in THE SITUATION ROOM.

Up ahead, a defiant Iran shows off it's military might. Is it a sign of what's to come? We are watching war games.

And welcome to the future of search and rescue. Robots that can do what humans can't. Stay with us. You're in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: Getting a story of potentially significant military ramifications. The Associated Press reporting the United States is now offering to provide Tokyo of up to 80 of the more advanced Patriot Interceptor Missiles for deployment in Japan. The A.P. cited the Kyoto News Agency. Let's get some context. We'll bring in our senior Pentagon correspondent, Jamie McIntyre, Jamie.

MCINTYRE: Wolf, this has been in the works for a while but it is now on the fast track, what with the missile crisis threat from North Korea. South Korea already has Patriots, so does Taiwan. Japan is going to start making Patriot Missiles themselves, but under this agreement they will be getting missiles by the end of year. These are short-range battlefield defenses. And as you remember from the Gulf War, Wolf, the Patriot didn't work too well in the 1991 Gulf War, but this is a new, advanced version that the Pentagon says works much better.

BLITZER: Would they shoot down those North Korean Taepodong-3 missiles?

MCINTYRE: Well, you know, they're not designed for that kind of long-range ballistic missile, but on the other hand, if you didn't have any other defense, this system is a hit to kill technology, designed to hit the missile. In the very last phase, it would be your last best shot to try to shoot a missile down if it was heading your way. And, of course, Japan is probably the country -- aside from perhaps South Korea -- that's most at risk of North Korean missiles.

BLITZER: Jamie, thank you very much for that. Jamie McIntyre reporting.

In another ominous display, Iran is showing off it's military might and shooting off missiles. Let's bring back Zain Verjee. She's got the story -- Zain.

VERJEE: Wolf, Iran is playing games -- war games -- and the message that comes with it a serious one.

(BEGIN VIDEOTAPE)

VERJEE (voice-over): Multiple missiles, blasted out, aimed at targets on the high seas. Iran Television broadcast video of war games, above ground and underwater.

KARIM SADJADPOUR, INTERNATIONAL CRISIS GROUP: Iran wants to send a very clear message to the international community that if they want to take an escalatory approach toward Iran, it's going to be fought with risk.

VERJEE: Iran claims their missiles can strike Israel and even parts of Europe. They have a nuclear program that many fear could lead to a bomb. But even though Iran is facing the threat of sanctions by the U.N. Security Council, experts say Iran is in a powerful position. Iraq is bloodier and messier and oil prices are higher.

ROBERT LOWE, MIDDLE EAST ANALYST: Iran always retains a powerful card in its ability to cut off oil supplies.

VERJEE: To some experts Iran appears to be emerging as a new regional power and is warming to the idea of a new Middle East, but one where it is king.

SADJADPOUR: It's going to be reflected in their image, not the image of the United States, meaning their friends in Lebanon and Iraq and Palestine are coming into power and the secular democrats, the friends of the United States, are in retreat.

VERJEE: Iran is calling its war games the "Blow of Zulfiqar" after a sword that belonged to the revered Shia Iman Ali, the first cousin of the Prophet Muhammad who used it in battle.

(END VIDEOTAPE)

VERJEE: The war games are expected to last up to five weeks. Iran holds military exercises routinely to test its equipment -- Wolf.

BLITZER: Zain, thank you very much.

"Welcome to the future." There's new robot technology that could help search and rescue teams across the United States with important, potentially dangerous missions. Once again, CNN's homeland security correspondent, Jeanne Meserve -- Jeanne.

MESERVE: Wolf, emergency workers already use robots to detonate bombs. Now the Department of Homeland Security is looking to the future, exploring other applications.

(BEGIN VIDEOTAPE)

MESERVE (voice-over): A robotic jaws of life pries open a car door. The operators could be more than half a mile away. It's a demonstration of how this technology could save lives if rescuers can't reach victims. Already being used in Spain and the Middle East, it is one of many robot technologies being exhibited to 20 urban search and rescue teams at a conference outside of Washington, D.C.

JOHN MAGIN, PRESIDENT, BOZ ROBOTICS: If we had a chemical, a biological type of a spill and you had people that were trapped in a car, instead of sending in the fireman or different type of dogs, what not, you need to get in there and get into that car, you could send this in remotely and do the same type of operation.

MESERVE: The event was organized by National Institute of Standards and Technology and the Department of Homeland Security, as they set the parameters that robots need to meet in order for teams to use federal grant money to buy them. First responders say the robots could be used in chemical, biological, radiological or nuclear attacks.

MIKE CONDITT, NEBRASKA TASK FORCE: One of the things that we're thinking about doing with them is putting hazmat sensors on them and sending them into a potential hazmat spill or even, you know, God forbid, something like a dirty bomb or something of that nature.

MESERVE: But some members of the teams were not as impressed by the technology.

LEE HAUS, L.A. CITY URBAN SEARCH & RESCUE: Until they get some treads on them that can actually work some of these piles, the dogs are much faster.

MESERVE: And that means Brutus can keep his job for now. (END VIDEOTAPE)

MESERVE: DHS has not yet OK'd the use of federal moneys to buy robots, that decision expected soon -- Wolf.

BLITZER: Jeanne, thanks very much for that "Welcome to the Future" report.

Still ahead, is there something in the water on Capitol Hill? Jack Cafferty will be back with your thoughts on politicians who say the darndest things. Stay with us. You're in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: Just a little bit more than one hour from now, "IN THE FOOTSTEPS OF BIN LADEN," our special two-hour documentary. Stick around and watch that. Let's go to Jack Cafferty in New York -- Jack.

CAFFERTY: Do you think we promoted that thing enough? The question this hour is why do some politicians insist on sticking their feet in their mouths?

Scott writes from Illinois, "If they didn't have their feet in their mouths, you'd be noticing their hands in your pockets."

Dave writes, "As a recovering foot in mouth man myself, I have a theory. There's this gene that some of us are born with. It's medical name is self-destructivitis, and it can flare up in an instant. Please ask your Dr. Sanjay Gupta if he knows of any clinic where this damn thing could be surgically removed."

Mark in Arlington, Virginia: "You quote all Republicans as though they're the only ones guilty of foot in mouth disease. What about the recent comment by a high-profile Democrat, Senator Joe Biden? Quote, 'You cannot go to a 7-11 or a Dunkin' Donuts unless you have a slight Indian accents. I'm not joking.' Let's play fair and admit these guys are all human, and by human I mean a little prejudiced one way or another."

Lisa writes, "They do it because every one in awhile during an otherwise scripted event, they speak extemporaneously and the little truth slips out."

Alan in Portland, Oregon: "It keeps them from lying through their teeth. That's lame."

Tim: "Great question. If you can tell us why you do it, then I'm sure we'll have the answer."

Wayne in Charlotte, North Carolina: "This e-mail reply to your on-air question about politicians with their feet in their mouths has been made possible by Al Gore who invented the Internet."

Sid in Danbury, Texas writes, "It's a much better place than where most of them seem to have their heads stuck." If you didn't see your e-mail here, you can go to CNN.com/CaffertyFile, and you can read more of these e-mails online -- Wolf.

BLITZER: And you know what's coming up in an hour, Jack?

CAFFERTY: Gee, is it that soon?

BLITZER: "IN THE FOOTSTEPS OF BIN LADEN" -- no, seriously.

CAFFERTY: I've lost track of time.

BLITZER: You're going to want to see it. Rush home, you'll watch it. I'm going to do exactly the same thing. Jack, thanks very much.

CAFFERTY: You're welcome.

BLITZER: And up next, a special edition of "LARRY KING LIVE," Larry airing right now. Thanks very much for joining us.

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