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THE SITUATION ROOM

Unexpected Extension for U.S. Soldiers; Iraq: Fueling Terror?; NSA Wiretap Bill

Aired September 25, 2006 - 17:00   ET

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


WOLF BLITZER, CNN ANCHOR: 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 today's top stories.

Happening now, unexpected surprise.

It's 1:00 a.m. in Iraq, where some U.S. troops thought they would be leaving soon, but guess what? They're now learning they won't be leaving all that soon, they're staying.

Security abroad, insecurities at home. Is the war in Iraq making America less safe? Yes, says portions of a leaked super-secret report. Republicans say it does not tell the whole story. Democrats say it proves the war in Iraq is a giant recruiting poster for terrorists.

And Bill Clinton on the attack. In a TV interview, the former president says he's the target of a conservative hit job. Did his successor do enough to catch Osama bin Laden? I'll ask a member of the 9/11 Commission.

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

Some say it's a clear example of the U.S. Army being stretched too thin in Iraq. For the second time since August, some soldiers who thought they'd be leaving Iraq soon are now being told that the violence in Iraq is so bad, they have to stay longer.

Let's get details. Our Pentagon correspondent, Barbara Starr, is following this story -- Barbara.

BARBARA STARR, CNN PENTAGON CORRESPONDENT: Well, Wolf, some very tough news for some U.S. troops and their families.

(BEGIN VIDEOTAPE)

STARR (voice over): Thousands of Army soldiers will now stay on the front lines in Iraq longer than expected or go into combat sooner than planned. In Ramadi, where al Qaeda and insurgent attacks have raged, a brigade of the 1st Armored Division has been ordered to stay.

DONALD RUMSFELD, SECRETARY OF DEFENSE: From time to time there may be units that will be asked to increase the number of days in country from what had been anticipated. On the other hand, we're also bringing some other units in earlier.

STARR: About 4,000 troops had expected to be home by January, but now they will stay so another unit from the 3rd Infantry Division will have at least 12 months back in Georgia with their families before they return to combat. All of this is happening because the Pentagon has to find a way to keep up to 145,000 troops in Iraq through the spring of next year. And about 4,000 troops from the 1st Cavalry Division in Texas will go to Baghdad 30 days early beginning in late October.

The Bush administration hopes that will allow soldiers from Alaska's 172nd Stryker Brigade to return home beginning by Thanksgiving. That unit was already extended and has suffered several casualties.

Army Chief of Staff General Peter Schoomaker now taking the unprecedented step of refusing to sign off on the Army's proposed budget because he believes it doesn't have enough money for the badly worn-out force. Defense Secretary Donald Rumsfeld essentially playing it all down.

RUMSFELD: We've been in discussions with the Army for some weeks, just as we are with the other services.

(END VIDEOTAPE)

STARR: But, Wolf, General Schoomaker is known as a man of very deep principles who believes that the Army needs billions of dollars in additional funding, especially because no one can predict when the troops now will come home from either Iraq or Afghanistan -- Wolf.

BLITZER: All right, Barbara. Thank you.

Our CNN "Security Watch" is focusing in on part of the leaked classified U.S. intelligence report that says the war in Iraq is actually increasing the terrorist threat and it's adding fresh fuel to the already fiery debate over the overall U.S. mission in Iraq.

Our justice correspondent, Kelli Arena, joining us now live with more -- Kelli.

KELLI ARENA, CNN JUSTICE CORRESPONDENT: Wolf, just five weeks before the midterm elections most people say that the release of certain portions of this report was politically motivated, but regardless, this report does represent the best thinking on the intelligence front.

(BEGIN VIDEOTAPE)

ARENA (voice over): It is the most authoritative assessment of the terrorism threat and, according to officials, concludes the war in Iraq is only making things work.

Ellen Laipson used to help prepare national intelligence estimates. ELLEN LAIPSON, STIMSON CENTER: The judgment itself seems pretty straightforward to me and I think would not come as a surprise to many people who have been watching the violence in Iraq.

ARENA: Officials familiar with the report say it discusses how Iraq is now the primary training ground for Islamic extremists. The fear is those terrorists could return to their home countries to carry out attacks there, but the administration says the leaked portions of this secret report don't present a complete picture.

DAN BARTLETT, COUNSELOR TO THE PRESIDENT: It doesn't make any final judgments to say that America is less safe or not because of this. It's just saying that they use this to use as a recruitment tool, which we shouldn't be surprised about.

ARENA: The estimate is put together by 16 intelligence agencies and covers a wide range of issues from military to economic to political. It is a summation of viewpoints and of best-guess forecasts of things to come. Iraq would have been just one of many issues covered.

LAIPSON: Remember, an estimate doesn't boil down to one sentence. It may be a series of as many as five, six, seven major key findings, and this would have been one of those findings.

ARENA: Intelligence agencies have changed the way the estimate is put together, following criticism of the October 2002 report concluding Iraq had weapons of mass destruction.

(END VIDEOTAPE)

ARENA: For starters, dissenting opinions carry more weight in the report than they did in the past. Officials say the report also offers policymakers more detailed descriptions of both intelligence and the sources of that intelligence.

For now, Wolf, this does remain classified. But as you know, there are calls from Congress to make it public. We'll see what happens.

BLITZER: Kelli, thank you very much.

Legislation on the Bush administration's controversial domestic surveillance program clears a major hurdle.

Let's go to CNN's Zain Verjee. She's got the latest details -- Zain.

ZAIN VERJEE, CNN ANCHOR: Wolf, a bill formalizing the National Security Agency surveillance program could head to the Senate floor this week. This after Republican senators Larry Craig, John Sununu and Lisa Murkowski reached a compromise with the White House on the bill today. They say the agreement preserves Congress' role in regulating surveillance activities within the United States and protects American civil liberties. Now, the bill allows but doesn't require President Bush to submit the wiretap without warrants program to a special court to determine if it's constitutional -- Wolf.

BLITZER: Zain, thank you for that.

And stay tuned to CNN day and night for the most reliability news about your security.

Jack Cafferty once again joining us from New York with "The Cafferty File" -- Jack.

JACK CAFFERTY, CNN ANCHOR: Thank you, Wolf.

Sometimes politicians say really dumb things. Check this out.

(BEGIN VIDEO CLIP)

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: I'd like to tell people when the final history is written on Iraq, it will look like just a comma, because there is -- my point is there's a strong will for democracy.

(END VIDEO CLIP)

CAFFERTY: A comma in the history books. That was in an interview with Wolf Blitzer. That particular clip ran yesterday in his Sunday program.

Well, Mr. President, here's what that comma looks like so far: 2,700 American soldiers dead, 20,000 Americans seriously wounded, arms and legs blown off, things like that, hundreds of thousands of Iraqis dead, including women and children, the wholesale slaughter of innocent civilians. Many of these people tortured before they're murdered just because they happen to get caught in the waves of secular rage that are sweeping through that country.

It's violence unlike anything I can remember. And the United States and the Iraqi government are powerless to control it.

An increase in the terrorist threat to the United States as a result of President Bush's decision to invade Iraq. That's according to the latest national intelligence estimate. We'll have more on that later in the third hour of THE SITUATION ROOM.

And appropriations from the U.S. Treasury to pay for all this, this comma, totaling $500 billion and counting.

So here's the question: Do you agree with President Bush that the war in Iraq will be recorded as nothing more than a "comma" in the history books?

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

Unbelievable, Wolf.

BLITZER: Jack, thank you. Jack Cafferty with his question.

And up ahead, the former president of the United States, Bill Clinton, lashing out, saying he came closer to getting Osama bin Laden than anyone. Is that in fact true? We're going to get a "Fact Check" from our senior Pentagon correspondent, Jamie McIntyre. He's standing by live.

And what about President Bush and the hunt for bin Laden? Former 9/11 commissioner Richard Ben-Veniste breaking his silence on one aspect of this investigation. He's standing by to join us live right here in THE SITUATION ROOM.

Plus, Osama bin Laden's alleged health crisis. We'll have the latest on reports saying the world's most wanted terrorist is seriously ill. Is he?

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

(COMMERCIAL BREAK)

BLITZER: Welcome back.

Former president Bill Clinton says he's gotten closer than anyone to killing Osama bin Laden, a statement that has the critics scoffing. So what are the facts?

We asked our senior Pentagon correspondent, Jamie McIntyre, to weigh in with a reality check. He covered the Pentagon during the Clinton administration -- Jamie.

JAMIE MCINTYRE, CNN SR. PENTAGON CORRESPONDENT: Well, Wolf, President Clinton, he admits that he failed to get Osama bin Laden, but he says it was because he was limited by political and practical realities.

(BEGIN VIDEOTAPE)

MCINTYRE (voice over): Back in August of 1998 the U.S. military insisted publicly the 62 cruise missiles it lobbed into Afghanistan were aimed at terrorist infrastructure. The inside word at the time was infrastructure was simply a euphemism for Osama bin Laden and his top lieutenants. But after the attacks of September 11th, former Clinton administration officials wanted full credit for targeting the terrorist leader.

SANDY BERGER, NATIONAL SECURITY ADVISER: I assure you they were not delivering an arrest warrant. The intent was to kill bin Laden. That's number one -- his overall intent was manifest in August '98.

MCINTYRE: Bin Laden escaped by hours, apparently, and President Clinton claims, while he failed, no one has had a better shot since.

WILLIAM JEFFERSON CLINTON, FMR. PRESIDENT OF THE UNITED STATES: I worked hard to try to kill him. I authorized the findings of the CIA to kill him. We contracted with people to kill him. I got closer to killing him than anybody's gotten since. MCINTYRE: Clinton argues his efforts were undercut by partisan sniping, including some critics who charge the cruise missile strike was a "Wag the Dog" stunt to divert attention from the Monica Lewinsky scandal. But Republicans dispute that, arguing the failed attack drew bipartisan praise. And Clinton's own FBI director, Louis Freeh, charges in his 2005 book that the U.S. lacked the political spine to put its full force behind covert attempts to get bin Laden.

Former deputy CIA director for intelligence John McLaughlin says from his inside perspective it looked a lot different.

JOHN MCLAUGHLIN, CNN NATIONAL SECURITY ADVISER: President Clinton did aggressively pursue Osama bin Laden. I give the Clinton administration a lot of credit for the aggressiveness with which they went after al Qaeda and bin Laden.

(END VIDEOTAPE)

MCINTYRE: But President Clinton said he was also hampered by inconclusive intelligence. In fact, he said after the bombing of the USS Cole in 2000, law enforcement and intelligence agencies couldn't agree that al Qaeda was responsible until after the 2000 election, something by the way, Wolf, that was backed up by the 9/11 report -- Wolf.

BLITZER: Jamie, thanks very much. Good report.

And what about President Bush and the hunt for bin Laden?

For more on that, we're joined by Richard Ben-Veniste. He's a former member of the 9/11 Commission, one of the Democratic members of that commission.

Richard, thanks very much for coming in.

RICHARD BEN-VENISTE, FMR. 9/11 COMMISSION MEMBER: Good seeing you.

BLITZER: All right. You, in your questioning in your investigation, when you were a member of this commission, specifically asked President Bush about efforts after he was inaugurated on January 20, 2001, until 9/11, eight months later, what he and his administration were doing to kill bin Laden, because by then it was certified, it was authorized. It was, in fact, confirmed that al Qaeda was responsible for the attack on the USS Cole in December of 2000.

BEN-VENISTE: It's true, Wolf, we had the opportunity to interview President Bush, along with the vice president, and we spent a few hours doing that in the Oval Office. And one of the questions we had and I specifically had was why President Bush did not respond to the Cole attack. And what he told me was that he did not want to launch a cruise missile attack against bin Laden for fear of missing him and bombing the rubble (ph).

And then I asked him, "Well, what about the Taliban?" The United States had warned the Taliban, indeed threatened the Taliban on at least three occasions, all of which is set out in our 9/11 Commission final report, that if bin Laden, who had refuge in Afghanistan, were to strike against U.S. interests then we would respond against the Taliban.

BLITZER: Now, that was warnings during the Clinton administration...

BEN-VENISTE: That's correct.

BLITZER: ... the final years of the Clinton administration.

BEN-VENISTE: That's correct.

BLITZER: So you the asked the president in the Oval Office -- and the vice president -- why didn't you go after the Taliban in those eight months before 9/11 after he was president. What did he say?

BEN-VENISTE: Well, now that it was established that al Qaeda was responsible for the Cole bombing and the president was briefed in January of 2001, soon after he took office, by George Tenet, head of the CIA, telling him of the finding that al Qaeda was responsible, and I said, "Well, why wouldn't you go after the Taliban in order to get them to kick bin Laden out of Afghanistan?"

Maybe, just maybe, who knows -- we don't know the answer to that question -- but maybe that could have affected the 9/11 plot.

BLITZER: What did he say?

BEN-VENISTE: He said that no one had told him that we had made that threat. And I found that very discouraging and surprising.

BLITZER: Now, I read this report, the 9/11 Commission report. This is a big, thick book. I don't see anything and I don't remember seeing anything about this exchange that you had with the president in this report.

BEN-VENISTE: Well, I had hoped that we had -- we would have made both the Clinton interview and the Bush interview a part of our report, but that was not to be. I was outvoted on that question.

BLITZER: Why?

BEN-VENISTE: I didn't have the votes.

BLITZER: Well, was -- were the Republican members trying to protect the president and the vice president? Is that what your suspicion is?

BEN-VENISTE: I think the question was that there was a degree of confidentiality associated with that and that we would take from that the output that is reflected in the report, but go no further. And that until some five years' time after our work, we would keep that confidential. I thought we would be better to make all of the information that we had available to the public and make our report as transparent as possible so that the American public could have that.

BLITZER: Now, you haven't spoken publicly about this, your interview in the Oval Office, together with the other commissioners, the president and the vice president. Why are you doing that right now?

BEN-VENISTE: Well, I think it's an important subject. The issue of the Cole is an important subject, and there has been a lot of politicization over this issue, why didn't President Clinton respond?

Well, we set forth in the report the reasons, and that is because the CIA had not given the president the conclusion that al Qaeda was responsible. That did not occur until some point in December. It was reiterated in a briefing to the -- to the new president in January.

BLITZER: Well, let me stop you for a second. If former President Clinton knew in December...

BEN-VENISTE: Right.

BLITZER: ... that the CIA and the FBI had, in his words, certified that al Qaeda was responsible, he was still president until January 20, 2001. He had a month, let's say, or at least a few weeks to respond.

Why didn't he?

BEN-VENISTE: Well, I think that was a question of whether a president who would be soon leaving office would initiate an attack against a foreign country, Afghanistan. And I think that was left up to the new administration. But strangely, in the transition there did not seem to be any great interest by the Bush administration, at least none that we found, in pursuing the question of plans which were being drawn up to attack in Afghanistan as a response to the Cole.

BLITZER: Now, as best of my recollection, when you went to the Oval Office with your other commissioners, the president and the vice president did that together. That was a joint interview.

BEN-VENISTE: At the request of the president.

BLITZER: Did the vice president say anything to you? Did he know that this warning had been given to the Taliban, who were then ruling Afghanistan, if there's another attack on the United States, we're going to go after you because you harbor al Qaeda? And there was this attack on the USS Cole.

BEN-VENISTE: The vice president did not at that point volunteer any information about the Cole.

BLITZER: So what's your -- did the president say to you -- did the president say, you know, "I made a mistake, I wish we would have done something"? What did he say when you continually -- when you pressed him? And I know you're a former prosecutor, you know how to drill, try to press a point.

BEN-VENISTE: Well, the president made a humorous remark about the fact that -- asking me whether I had ever lost an argument, and I reminded him that -- or I informed him that I, too, had two daughters. And so we passed that.

He made his statement about the state of his knowledge, and I accepted that as a given, although I was surprised considering the number of people who continued on, including Richard Clarke. So that information was there and available, but the question of why we did not respond to the Cole, I think it was an important lapse, quite frankly.

I think that we would have sent a message to the Taliban and we would have sent a message to al Qaeda. It could have conceivably -- I don't know the answer to this, but conceivably it could have had an affect on whether Sheikh Mullah and -- Omar.

BLITZER: Mullah Mohammed Omar, the leader of the Taliban.

BEN-VENISTE: Omar, right -- would have continued to harbor bin Laden and al Qaeda in their country.

BLITZER: It's such a fascinating aspect of this whole issue. It's surprising to me that none of this made it into the final report, but that's a question for another day.

BEN-VENISTE: Well, some of it did.

BLITZER: But the -- but the -- but the specific references to the interview in the Oval Office.

BEN-VENISTE: That's correct, but the threats that were conveyed to the Taliban government in Afghanistan are reflected in our report.

BLITZER: Well, thanks very much, Richard Ben-Veniste, for coming in.

BEN-VENISTE: Thank you.

BLITZER: Appreciate it.

And coming up, is Osama bin Laden seriously ill? And if so, what does he have? We're going to talk to experts about a possible -- repeat, possible -- health crisis for the world's most wanted terrorist.

Plus, new rules that will affect anyone who flies. The government changing what you're allowed to bring on board on your next flight. We're going to tell you all about it.

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

(COMMERCIAL BREAK)

BLITZER: Let's check back with Zain once again for a quick look at some other important stories making news.

Hi, Zain.

VERJEE: Hi, Wolf.

More recalls in connection with the E. coli outbreak from spinach. A Seattle company is yanking some salad products from store shelves in the Northwest. The FDA says the recall by Triple B Corporation involves salad greens with spinach packed in hard boxes and destined for stores in Washington State, Oregon, Idaho, and Montana. More than 170 people across the country have gotten really sick from tainted spinach and one death has been confirmed.

Cooler weather is helping thousands of firefighters battle a huge blaze in southern California. The Day Fire in the Los Padres National Forest has burned 134,000 acres. It's now about 41 percent contained. Fire crews say cooler ocean breezes are replacing the hot Santa Ana winds which had fanned the flames. Authorities say no homes are in immediate danger but nearby residents are being told to stay alert.

The Red Cross begins a mission today to see the newest terror suspects being held by the U.S. at Guantanamo Bay, Cuba. The Bush administration says 14 high-level suspects were transferred there from the CIA secret prisons, including reputed 9/11 mastermind Khalid Sheikh Mohammed. A Red Cross spokesman says its envoys should have access to the detainees in the next two weeks.

Pope Benedict XVI is calling for dialogue between Muslims and Christians. He met today with about 20 Muslim ambassadors. The pope caused a worldwide furor recently when he cited a 14th century emperor's critical comments about Islam, but he said today he wants to stress his total and profound respect for all Muslims -- Wolf.

BLITZER: Thank you very much, Zain, for that.

And to our viewers, you're in THE SITUATION ROOM, where new pictures and information are arriving all the time.

Happening now, the war in Iraq, is it making America less safe? That's the conclusion of a super-secret report leaked to the news media. The White House says there's more to the story. Democrats say it proves the Iraq war is benefiting terrorists.

Is there a vast right-wing conspiracy to do a hit job on Bill Clinton? The former president says yes and he's lashing out at critics who say he should have done more to kill Osama bin Laden.

And your shampoo and lotion are no longer considered deadly weapons. Federal officials say you can now carry them and some other toiletries on board your next flight. Beginning tomorrow, you'll also be able to carry on board water you buy after you've been screened.

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

In our CNN "Security Watch," new questions about the health of the world's most wanted terrorist. Let's bring in CNN's Brian Todd. He's watching the story for us -- Brian.

BRIAN TODD, CNN CORRESPONDENT: Wolf, we now know that reports of Osama bin Laden's demise may be exaggerated, but reports of his physical decline may not be.

(BEGIN VIDEOTAPE)

TODD (voice over): U.S. intelligence officials tell CNN it's remarkably difficult to confirm anything about Osama bin Laden's health. But if a source close to Saudi intelligence is correct and bin Laden has a so-called waterborne illness, experts say that could mean typhoid fever, dysentery, possibly E. coli, all potentially fatal but also recoverable.

That same Saudi source says bin Laden may be hiding somewhere at high altitude, a mountainous area thousands of feet up from sea level. If that's in northern Pakistan or somewhere in the Waziristan region of Pakistan, near the Afghan border, can the al Qaeda leader survive for any length of time with one of those diseases?

DR. SHMUEL SHOHAM, WASHINGTON HOSPITAL CENTER: They may have an immune response, but they've been in these conditions for a while. They may have become accustomed to those conditions.

TODD: But Dr. Shmuel Shoham, an infections disease specialist at Washington Hospital Center, says bin Laden also has some disadvantages if he's come down with a waterborne illness.

UNIDENTIFIED MALE: Just by virtue of constantly being on the run, one's immune system may be weakened by the physiological stress of being on the lam.

TODD: Or the lack of access to antibiotics or hospital treatment, according to Dr. Shohan. Another possible complication, terrorism experts cite a claim by bin Laden and others close to him that he suffered a significant physical setback long ago at the hands of Soviet forces.

PAUL SRUICKSHANK, NYU CTR. ON LAW AND SECURITY: Ever since bin Laden suffered a serious gas attack in the late 1980's in Afghanistan, he's had serious health problems arising from that. It seems he's had very low blood pressure, he's had acute dehydration, he's had chronic back pain, he's had very severe problems with his voice.

TODD: Experts say if that gas attack affected bin Laden's kidneys or bone marrow, his immune system could be damaged, making a recovery more difficult.

(END VIDEOTAPE)

TODD: One important signal, no taped message from bin Laden on the fifth anniversary of September 11th and no videotape of him in almost two years. But terrorism experts say these reports about his health may well inspire him to put out another tape very soon. Wolf? BLITZER: Brian, thanks very much. Brian Todd reporting.

Also in our "security watch" today, the Transportation Safety Administration is relaxing some of the latest rules about what you can and can't take onboard commercial airline flights. Let's bring in our homeland security correspondent Jeanne Meserve, she has details that affect all of us who like to fly, Jeanne.

JEANNE MESERVE, CNN HOMELAND SECURITY CORRESPONDENT: Wolf, the Transportation Security Administration calls it a common-sense approach to security, but some experts say it isn't security at all.

(BEGIN VIDEOTAPE)

MESERVE (voice-over): Liquid gels and aerosols now allowed in carry-on bags if you don't carry on very much. Three ounces or less of toiletries like toothpaste, lotion and lip gloss now permitted if they are placed in one clear zip-loc plastic bag. Also allowed on flights, beverages and other items, bought on the other side of security, in the boarding area. The TSA says although liquid explosives remain a significant threat, intelligence experimental testing and overall increases in aviation security allowed the modifications.

KIP HAWLEY, DIR., TRANSPORTATION SECURITY ADMINISTRATION: We've looked at all of the various MacGyver scenarios that you can imagine, and we are comfortable with these measures that we are adequately covered.

MESERVE: But some security experts believe complaints from travelers and businesses triggered the changes, which they say leave too many loopholes terrorists could exploit.

GEORGE BAURIES, FORMER FBI AGENT: We know that al Qaeda has frequently worked in small groups, so if you take three ounces and multiply it times a factor of four or five or six individuals that will be ample material to bring basically a liquid bomb aboard a plane.

MESERVE: The TSA disagrees.

HAWLEY: We are not flying near the treetops on this. We are giving ourselves plenty of room and the only thing we're thinking of here is the safety of the traveling public.

(END VIDEOTAPE)

MESERVE: Hawley says the changes in the liquid ban which take affect tomorrow, will free screeners to look for more significant threats. But, the ultimate solution, a reliable technology to screen for liquid explosives, is not yet deployed at the nation's airports. Wolf?

BLITZER: All right Jeanne, thanks very much. And keeping track of all of this, let's get a little bit more from Jacki Schechner, she's sorting it out. Jacki? JACKI SCHECHNER, CNN INTERNET REPORTER: Well Wolf, if you go to tsa.gov, they've made it really easy for you to find what you need to know on their website. They have a series of videos showing you exactly how large these things can be, they also have video showing you what it's going to be like when you get to the screening process. They have a list of the items, of course, no more than three ounces, that zip-loc bag we were talking about can't be more than a quart large. They have it all spelled out for you in video, in downloadable posters, everything you need to know at tsa.gov and also some tips to make the travel easier. Keep your bag as de-cluttered as possible, and they also say if you can still check liquids, you should do so. Wolf?

BLITZER: Thanks very much Jacki for that. And remember, stay tuned to CNN day and night for the most reliability news about your security.

Coming up, after 9/11, did the CIA pay Pakistan millions of dollars to round up al Qaeda suspects? Pakistan's president says the answer is yes, and he has other bombshells in his new book. We'll have some of the stunning details.

And the Reverend Jerry Falwell suggests the devil himself would be a more likable candidate for president than Senator Hillary Rodham Clinton. It's the latest salvo in the ongoing war between the Clintons and those on the far right. Mary Snow is watching this story.

(COMMERCIAL BREAK)

BLITZER: Welcome back. Today allied officials are hailing the killing of a man believed to be a top terrorist with al Qaeda. In Iraq, British troops killed Omar Farouk in an overnight raid in Basra. American officials previously described him as al Qaeda's chief for Southeast Asia. My next guest has extensively covered Southeast Asia, as well as Iraq, he's the author of an important new book entitled "Imperial Life in the Emerald City." Rajiv Chandrasekaran is joining us here in THE SITUATION ROOM, he's in New York. First of all, Rajiv, first of all congratulations on this excellent new book.

RAJIV CHANDRASEKARAN, "IMPERIAL LIFE IN THE EMERALD CITY": Thanks, Wolf, it's a pleasure to be here to talk to you today.

BLITZER: I want to get into the book for a moment, but you spent a lot of time in Iraq at the beginning, all of us read your dispatches in "The Washington Post", brilliant reporting. Based on what you know right now, is it safer today than it was then in Iraq, as far as the terror threat is concerned?

CHANDRASEKARAN: It's hard to look at the facts on the ground and come to that conclusion, Wolf. I think that by all reasonable metrics, by talking to military officials who have served there, people I know back here in the states, Iraqis I know, I think that all signs point to what has been stated in this latest NIE, that certainly the terror threat is as much higher now from Iraq than it was previously. BLITZER: And what you write in your book is that a lot of the mistakes that were made during that first year of the U.S. military occupation in Iraq are plaguing the United States and the Iraqis for that matter today. What were some -- give me one or two of the biggest mistakes that were made early on?

CHANDRASEKARAN: Well Wolf, my book is really about that other fiasco. I think we all know now how the Pentagon failed to commit enough troops to stabilize Iraq, failed to anticipate the rise of the insurgency. What I've written about is the litany of other mistakes, and it's not just the de-Baathification orders, it's not just the decision to disband the army, but it's a whole slew of other missteps that I argue that were made by Ambassador Bremer, who headed up the occupation authority and many of his staffers. It's everything from sending the wrong people over there, people who were chosen more because of their political loyalty than their skill to do the job, to folks who showed up there and saw a country with 40 percent unemployment and said what this place needs is a flat tax, what this place needs is a new motor vehicle code. It's an incredible list Wolf of things that we were doing that were essentially rearranging deck chairs on the proverbial "Titanic" out there instead of getting into and dealing with the most important issues in terms of reconstruction, governance, and doing what was necessary to get Iraq back up on its feet.

BLITZER: If they had done it differently, if they had done it the right way, let's say, would it have made a difference though in the long run? Would the situation in Iraq be a peaceful, stable, liberal-type democracy today?

CHANDRASEKARAN: Well I don't accept that all of this chaos that we see there now is inevitable. At the same time, I don't think that even if we had done everything perfectly we would have prevented an insurgency or we would have prevented civil strife. But I think what we would have is something in the middle, Wolf, a situation that'll be somewhat more conducive. I don't think we'd have a secular democracy where everything was going all right, but I also, you know, don't thinks that things would necessarily have to be as bad as they are today.

BLITZER: Is it just Paul Bremer who made the big mistakes in your assessment, or does it go much higher?

CHANDRASEKARAN: It certainly wasn't just Bremer. It goes higher and lower. Certainly above him, secretary of defense Donald Rumsfeld, then national security adviser Condoleezza Rice, they were for many months sort of checked out. They had left Bremer with a very long leash and allowed him to do many things that they later decided and came to conclude were missteps. And they did not take as active of a role in managing the day-to-day affairs there in Iraq, as well as a lot of Bremer's deputies and underlings, people who came in with very fanciful notions of what needed to be done, that just weren't commensurate with the resources that were being brought to bear or with what was in the best interest of the Iraqi people, or for that matter, for the security of the United States. BLITZER: It's an important book, "Imperial Life in the Emerald City." Rajiv Chandrasekaran is the author, Rajiv, thanks very much for coming in.

CHANDRASEKARAN: Good to talk to you, Wolf.

BLITZER: And Rajiv works for "The Washington Post," I should add that.

Still to come in our 7:00 p.m. eastern hour, the two people some conservatives love to hate. That would be Bill and Hillary Clinton. They take on what they still call a vast right-wing conspiracy.

And after 9/11, did al Qaeda plan to hijack planes from Eastern Europe and blow them up when the fasten seatbelts sign went on? New details coming in from a U.S. ally in the war on terror.

(COMMERCIAL BREAK)

BLITZER: Welcome back. The president of Pakistan is hoping to prove his critics wrong when they say he's not doing enough in the war on terror. Let's bring in Zain Verjee, she's watching this story. Zain?

ZAIN VERJEE, CNN ANCHOR: Wolf, there is new information we're getting on the war on terror from an important U.S. ally. Pakistan's President Pervez Musharraf's new book is hitting the shelves and it's a surprising read.

(BEGIN VIDEOTAPE)

VERJEE (voice-over): Pakistan's president is making the hard sell for his autobiography "In the Line of Fire," even getting President Bush's endorsement.

BUSH: In other words, buy the book is what he's saying.

VERJEE: In the 337-page book, Pervez Musharraf alleges the CIA secretly paid Pakistan millions of dollars in reward money in exchange for hundreds of al Qaeda suspects. He writes, "Those who habitually accuse us of not doing enough in the war on terror, should simply ask the CIA how much prize money it has paid to the government of Pakistan."

The CIA's official response -- no comment. A former U.S. intelligence official tells CNN relationships just don't work that way. The intelligence community provides training and equipment for counter-terrorism operations but the U.S. does not pay money to governments to turn over terrorist suspects. Another allegation in the book, Musharraf speculates where Osama bin Laden, a Saudi himself, could be hiding. "I would assume he's moving back and forth between the Pakistan-Afghanistan border somewhere," he says. "The fact that so many Saudis are in the Konar area perhaps suggests that this is where Osama bin Laden has his hideout but we can't be sure."

Musharraf also reveals details of the interrogation of 9/11 mastermind Khalid Shaikh Mohammed. According to the book, al Qaeda planned to hijack planes from Eastern Europe to attack Heathrow airport. Allegedly, the signal for the hijackers would be the "fasten your seatbelt" sign. That would trigger them to spring into action. All of this information, says Musharraf, was passed on to British authorities and the plot was foiled. This, he claims, is one of his country's hidden successes. But without verification, it's hard to tell how much of this is true.

HUSAIN HUQQANI, BOSTON UNIVERSITY: I think that General Musharraf has definitely embellished some of the episodes General Musharraf thought would be useful for both promoting the book and promoting himself.

VERJEE: At least one of Musharraf's claims have already been knocked down. He claims in the book that after 9/11 then Deputy Secretary of State Richard Armitage threatened to bomb Pakistan back to the stone ages if they did not cooperate with the war on terror. Armitage flatly denies it.

ARMITAGE: I never said it.

(END VIDEOTAPE)

VERJEE: In the book, President Musharraf also says he war gamed the U.S. as an enemy after 9/11, but eventually calculated it was in Pakistan's best interest to support the U.S. in the war on terror. Wolf?

BLITZER: Thanks very much Zain. Zain Verjee reporting.

And this note, coming up tomorrow in our 7:00 p.m. eastern hour, my interview with the Pakistani President Pervez Musharraf. We'll talk about the hunt for Osama bin Laden, the war on terror, some apparent rifts with Washington. That's coming up tomorrow, my special interview with the Pakistani president.

Straight ahead this hour, they have a long, tense history, now tensions flaring again between the Clintons and the conservative right. We'll tell you what's going on. Stay with us, you're in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: Checking in with Lou Dobbs, he's getting ready for his program that begins right at the top of the hour. Lou?

LOU DOBBS, CNN ANCHOR: Wolf thank you. Coming up at 6:00 p.m. eastern here on CNN, tonight we'll be reporting on the rising threat to this nation's middle class from this country's massive dependence on foreign lenders. Many middle-class families simply can no longer afford the American dream. We'll have that special report. And tonight the federal government boosting spending on port security, but the increase will do little to secure our ports or protect this country from terrorism. The former inspector general of the homeland security department Clark Kent Irvin joins us to talk about our wide open ports, our wide open borders. And tonight we continue our exclusive reports on the risks to our democracy from e-voting. Tonight a judge in Colorado makes a ruling that is being watched all across the country with implications for our upcoming midterm elections. That special report and a great deal more. We hope you'll be with us. Wolf, back to you.

BLITZER: Lou, sounds good. Thank you very much.

The often tense relationship between the Clintons and the conservative right is heating up once again, with new accusations coming in from both sides. Let's bring in CNN's Mary Snow, she's joining us with details. Mary?

MARY SNOW, CNN CORRESPONDENT: Well Wolf that renewed tension was evident in two separate events involving both Clintons in recent days, it comes at a time when their popularity has been growing, their image is remade, as both build bipartisan bridges. But can it last?

(BEGIN VIDEOTAPE)

SNOW (voice-over): When it comes to solving the world's problem, Bill Clinton teams up with unlikely partners, like First Lady Laura Bush and media mogul Rupert Murdoch. But when "Fox News Sunday" challenged Clinton's record on terror while in office, he went on the attack.

BILL CLINTON, FORMER PRESIDENT: So, you did Fox's video on the show, you did your nice little conservative hit job on me -- what I want to know is this.

CHRIS WALLACE, FOX NEWS: You don't think that's a legitimate question?

CLINTON: It was a perfectly legitimate question, but I want to know how many people in the Bush administration you asked this question of.

SNOW: While the former president last out at conservatives, one conservative evangelical leader targeted the other Clinton and her potential presidential run. At a conference of church leaders, Jerry Falwell said voters feared Hillary Clinton more than the devil. CNN obtained this tape from a group monitoring these events.

JERRY FALWELL: I certainly hope that Hillary is the candidate. She has $300 million so far. But I hope she's the candidate because nothing will energize my (INAUDIBLE) like Hillary Clinton. If Lucifer ran, he wouldn't."

SNOW: The Reverend Jerry Falwell told CNN the comments were tongue in cheek. A spokesman for Senator Clinton said, "Working for someone who believes in the golden rule we're not going to engage in such vitriolic discourse. But it seems that a new low has been reached in demonizing political opponents."

Like her husband, Senator Hillary Clinton has teamed up with conservatives like Republican Newt Gingrich. But should she run for the White House, political observers say leftover anger from the Clinton years may be stirred up.

STU ROTHENBERG, THE ROTHENBERG POLITICAL REPORT: It's a little bit like Angelina Jolie and Brad Pitt. The Clintons are the Clintons, it's the two of them. And it's hard for some people, certainly many conservative Republicans, to separate the two. They see them as really the same thing, representing the same things, after the same agenda, and equally as enemies.

(END VIDEOTAPE)

SNOW: Political observers say while Senator Clinton has improved her standing with some Republicans and conservatives, it's the core social conservatives who continue to see her as the enemy. Wolf?

BLITZER: All right Mary, thank you very much. And up next, Jack Cafferty wants to know if you agree with President Bush that the war in Iraq will be recorded as nothing more than a, quote, comma in the history books. Stay with us, you're in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: Let's go right to Jack Cafferty. Jack?

CAFFERTY: Wolf, the question is, do you agree with President Bush when he told Wolf Blitzer that the war in Iraq will be recorded as nothing more than a comma in the history books? Charles in Washington, "I'm not surprised the president would make a statement like that. His inability to understand the damage he has done is further proof that he was never up for the job to begin with. His policies will have a ripple affect on generations to come. And when all is said and done, he'll be remembered as the worst president in American history." R.J. in Saugerties, New York," of course it's just a comma, as in, "Victory in Iraq would have been easy (comma), but Bush and Rumsfeld made so many bad decisions that turned into an endless bloodbath."

Lavon in Bedford, Texas, "No, the Iraq invasion will go down in history as a war crime committed by our country." Janel in Fredonia, New York, "I can't imagine any of the families who lost a loved one in this conflict would like to think of that loss resulting from a "comma" in U.S. history. A heartless remark from a heartless commander-in-chief." Michael, "I'm disgusted by President Bush's remarks. I'm an American soldier who's had many friends killed in Iraq, I spent 15 months there. Was all this for a comma in history? President Bush should be embarrassed."

And Paul in Bohemian, New York, I believe you misunderstood the president. Didn't he say he was in a coma? At least his policy in Vietnam; make that Iraq, seems to indicate that he is." If you didn't see your email here, you can go to cnn.com/caffertyfile and read more of these online. And we have a lot of them. Wolf?

BLITZER: A lot, hundreds?

CAFFERTY: Hundreds, hundreds, maybe more than a thousand in a half hour. I mean a lot of them. BLITZER: Any of them support Bush?

CAFFERTY: No. I mean, do you think anybody's going to write in and say, gee what an intelligent thing to say when you've got families of 3,000 kids out there that might be watching this. Families of 20,000 more wounded soldiers that might be watching this. How can you make a statement like that, this will be nothing more than a comma in history? Very insensitive I think.

BLITZER: See you in one hour Jack, thanks very much. Let's go to Lou in New York -- Lou.

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