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THE SITUATION ROOM

Democrats Accuse Republicans of Culture of Corruption; Investigations Continue in Foley Scandal; Comair Suing Federal Government Over Crash; U.N. Security Council to Vote Tomorrow on Sanctions

Aired October 13, 2006 - 16:00   ET

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


WOLF BLITZER, CNN ANCHOR: 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, House leaders threaten to expel a corrupt congressman. Republican Bob Ney pleads guilty in an influence- peddling probe, but refuses to leave office right away. It's 4:00 p.m. here in Washington, where top Republicans are feeling the heat of pre-election scandals.

Also this hour, the fallout keeps coming from the Mark Foley fiasco. The lawmaker in charge of protecting congressional pages explains himself.

And a House race in Minnesota gets close, contentious and very personal.

And in the final weeks before America votes, we're following the money. The trail of cash offers some clues about which party may win control of Congress.

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

Right now Congressman Bob Ney of Ohio is a convicted felon and a political threat to his fellow Republicans. Ney's guilty plea today in the Jack Abramoff probe was hard enough on GOP leaders, but they're downright livid right now about his refusal to quickly leave Congress when they're already reeling in from Mark Foley scandal. There's new fuel today for the fire over what top Republicans knew about Foley's online messages to pages and when they knew it. We're covering all of these stories.

Our congressional correspondent Andrea Koppel is standing by on Capitol Hill with the latest on the investigation. But first, let's go to the courthouse, where our senior political analyst Bill Schneider is standing by with more on the felony convictions -- Bill.

WILLIAM SCHNEIDER, CNN SR. POLITICAL ANALYST: Wolf, Representative Bob Ney showed up at this courthouse today to plead guilty to federal corruption charges, which makes him the latest member of Congress to get in trouble.

(BEGIN VIDEOTAPE) SCHNEIDER: Guilty as charged. That's how Ohio Congressman Bob Ney pleaded in federal court on Friday.

ALICE FISHER, ASSISTANT ATTORNEY GENERAL: Congressman Ney, in the documents, admits that he accepted a stream of benefits from Jack Abramoff and other lobbyists.

SCHNEIDER: Ney, a Republican, could face more than two years in prison and up to $60,000 in fines. He also faces pressure from his own party leaders.

REP. DEBORAH PRYCE (R), OHIO: He betrayed the trust of his constituents and of his colleagues here in the House and I do believe that he should resign.

SCHNEIDER: His lawyer says he will, but not yet. When he does, he'll be the fourth member of this Congress to resign in scandal, all Republicans.

REP. NANCY PELOSI (D), MINORITY LEADER: They have one in jail, two in rehab, one under indictment. I mean, the list goes on.

SCHNEIDER: Randy "Duke" Cunningham is serving an eight-year prison term for taking $2.4 million dollars in bribes from defense contractors. Former Majority Leader Tom DeLay was indicted in Texas for campaign finance violations. Mark Foley resigned after it was revealed that he exchanged sexually explicit messages with house pages.

REP. DENNIS HASTERT (R), HOUSE SPEAKER: We have the ethics committee doing the investigation, we have the U.S. attorney general and the FBI doing an investigation. And on Foley, we have the state of Florida doing an investigation.

SCHNEIDER: Any Democrats in trouble? Representative William Jefferson is under investigation for bribery. The FBI found $90,000 in his freezer, cold cash.

Republicans argue that corruption is not a partisan issue.

TONY SNOW, WHITE HOUSE PRESS SECRETARY: What Congressman Ney did is not only a reflection of the Republican party, it's a reflection of Congressman Ney, and he ought to step down.

SCHNEIDER: But it does seem to be hurting Republicans. Since December, the Democrats' lead on handling ethics in government has increased, mostly because more people say they don't trust either party.

(END VIDEOTAPE)

Democrats are talking about what they call a culture of corruption here in Washington. Not just the scandals, but also the fact that this Congress failed to pass major lobbying reform legislation after House and Senate Republicans were unable to come to agreement -- Wolf. BLITZER: I think that's generating a lot of anger among voters. Thanks very much. Bill Schneider reporting for us.

Let's get to the Mark Foley scandal right now. The House Republican who oversees the page board, as it's called, is the latest witness before the House Ethics Committee's investigation.

Let's check in with our congressional correspondent, Andrea Koppel.

What has happened so far today, Andrea?

ANDREA KOPPEL, CNN CONGRESSIONAL CORRESPONDENT: Well, Wolf, in all, Congressman Shimkus answered about 3.5 hours worth of questions from the House Ethics Committee today, and when he emerged from that behind closed doors Q&A, he told reporters he had been shown excerpts of e-mails that Mark Foley had sent to former page and that he confronted Foley about it and was joined by the house clerk. He was asked -- this was in the fall of 2005 and reporters asked him if he would have done anything differently.

(BEGIN VIDEO CLIP)

REP. JOHN SHIMKUS (R), ILLINOIS: I think there's stuff everybody would of done differently had -- 20/20 hindsight is always perfect. So having 20/20 hindsight, a lot of things would have been done differently.

KOPPEL: Now, Shimkus says that when he and the house clerk met with Foley last fall, they told him about this -- the inappropriate e- mails and Foley responded that he was only trying to mentor this young man, Wolf, and that there was nothing inappropriate about it or unseemly about it.

BLITZER: Andrea, who are the next big names that will appear before this committee?

KOPPEL: There are a couple of big names that we know at this point. Next week, the House Majority Leader John Boehner will appear. And as you know, Boehner's story has changed a couple of times. He said that the first time he heard about the inappropriate e-mail -- not the sexually explicit ones -- was back last spring. And he has said that he told Speaker Hastert about it. Now, Speaker Hastert has responded, saying he doesn't recall or remember such a conversation.

The other lawmaker who's set to testify is Representative Rodney Alexander of Louisiana. His office was the first office to be contacted by that 16-year-old former page who received those inappropriate, but not X-rated, e-mails -- Wolf.

BLITZER: All right, Andrea, thank you very much.

And there's a new angle in the Foley controversy that's surfacing right now. It may or may not mean much, but we're watching it. It's an e-mail the Florida Republican sent to Governor Jeb Bush back in 2004. The then Congressman complained that he was being ignored by President Bush during his trips to Florida.

Foley wrote this to Governor Bush at the time. Let me read it precisely. "Have I done something to offend the White House? I am always getting the shaft. They came to Ft. Pierce a few weeks ago and said I was not allowed to attend, yet Joe Negron is there."

Foley's e-mail to Jeb Bush goes on to say this. "Tomorrow POTUS" -- which stands for President of the United States -- "is in Martin County and I am told I am not allowed to be there, either. I can't quite figure what I have done, but this is a continuing pattern of slights. I have constantly put the president in the best possible light on everything from Haiti to hurricanes. Sorry to trouble you and I wouldn't if this wasn't so frequent."

Adam Putman was with him today in his district. President Bush made a number of trips to Florida while he was campaigning for reelection in some -- back then in 2004, especially after several hurricanes had occurred. The brother, the Governor Jeb Bush, reportedly responded to Foley's e-mail, saying he thought the president was spending a lot of time in debate preparation and that Foley wasn't deliberately being snubbed.

Today, the White House Press Secretary Tony Snow was asked about all of this.

(BEGIN VIDEO CLIP)

SNOW: It's not unusual for members of Congress to want to be in on things but, you know, again, what you've got is an e-mail to a third party to which it really can't respond.

(END VIDEO CLIP)

BLITZER: Let's bring in our congressional correspondent, Dana Bash. Dana, you've been checking out this story for much of the day. What are you picking up about this e-mail from Foley to Governor Bush?

DANA BASH, CNN CONGRESSIONAL CORRESPONDENT: Well, Wolf, I've talked to several former and current senior Bush administration officials, as well as a former Foley official, trying to figure out if, in fact, former Congressman Foley was being snubbed, and, if so, why.

Now, first about that e-mail you read. I talked to a former Foley aide, who said that he remembers the Congressman being angry at that time, but also quickly said that he thought it was Mark being hypersensitive because he was included in, quote, "tons of other stuff."

Now, Foley was one of those congressman known inside the Bush White House as somebody who wanted to be included in virtually -- invited to virtually everything. In fact, I talked to one senior official who said, quote, "He believed that he was the dean of the Florida delegation. Any time the president was in Florida, he wanted to be there." That from one senior administration official. And I talked to another, though, who said flatly that if anyone is looking at that e-mail of Foley complaining and suggesting that perhaps the White House snubbed him because they either knew he was gay or perhaps they knew about his inappropriate behavior, this senior official says that is quote, "ridiculous."

Now, the truth is that the president was with Mark Foley several times in Florida. In fact, one of those pictures now is -- that we're looking at is infamous at this point, of Mark Foley, the president and former FEMA director Mike Brown, after one of the hurricanes a couple of years ago in Florida.

Now, what -- one thing I can tell you that Bush officials, former Bush officials especially, say is that there was some animosity towards Mark Foley, especially Wolf from the Bush political shop, even and especially Karl Rove. Why? Because several people there thought that Foley spoke out of school and used opportunities with the president to, quote, "grandstand and be a jerk," that a quote from a former Bush official.

So politically, he did make the White House on several occasions quite angry. And if you want an illustration of that, we found a quote from Mark Foley back in September of 2004 talking about the president's ability to give a speech and here's what Mark Foley said back then.

"He gets a deer in the headlights look. When he stands a podium, he's grabbing it like a lifeline." Now that is Republican, former Republican Congressman Mark Foley talking about his Republican president just a couple of months before the election. So if you're looking for an example of why the White House might not have been happy with Mark Foley, perhaps that's a good example.

BLITZER: Dana Bash, doing some good reporting for us. Dana, thanks very much. Dana Bash, Andrea Koppel, Bill Schneider, they are all part of the best political team on television. And remember, for the latest campaign news any time, check out our political ticker. Go to CNN.com/ticker.

Let's go to Jack Cafferty in New York with "The Cafferty File." You're part of the best political team on television, too, Jack.

JACK CAFFERTY, CNN ANCHOR: OK, thank you, Wolf.

Not the best news coming from the United States' closest ally in Iraq. The chief of the British army says British troops should leave Iraq soon, quote, "because our presence exacerbates security problems."

The comments made by General Richard Dannatt to the "London Daily Mail," needless to say have caused quite a stir. Prime Minister Tony Blair says some of what Dannatt says may have taken out of context, but he says that he agrees with him. Blair says British troops won't stay in Iraq forever, but they will stay and get the job done in Basra. That's in southern Iraq, the area where most of Britain's 7,000 troops are stationed. Now Dannatt has since back pedaled on his comments. Suddenly, he says the word soon means two or three years. Leads you to wonder if he might have gotten a phone call from Mr. Blair. Anyway, here is the question. What does it mean for the United States when the British army chief says its time to leave Iraq soon? E-mail us your thoughts on that to CaffertyFile@CNN.com or go to CNN.com/CaffertyFile -- Wolf.

BLITZER: I think it means, in short, it's a bombshell and we're going to be talking with our Michael War. He's embedded with British troops, Jack, right now in Basra in the southern part of Iraq. That's coming up here in THE SITUATION ROOM. You're going to want to hear what he has to say.

CAFFERTY: I am indeed. It makes you wonder if we says we should leave soon and suddenly he says two or three years. That doesn't quite compute in my calculator.

BLITZER: There's a disconnect there, a little bit. Thanks Jack, very much.

Coming up, a looming showdown at the United Nations over North Korea's nuclear weapons. And new questions today about the test. Where is the radioactive residue?

Plus, the Foley factor. We'll have more on this story coming up. A Democratic candidate is making the scandal a major theme in her campaign. We're going to go live to Minnesota to find out why.

Plus, Bob Ney pleads guilty, but the congressman refuses to quit Capitol Hill. Will the scandal impact the November election? Donna Brazile and J.C. Watts, they're standing by for today's "Strategy Session." Stay with us, you're in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: There's a story just coming into THE SITUATION ROOM. Let's check in with Zain Verjee for details -- Zain?

ZAIN VERJEE, CNN ANCHOR: Wolf, Comair says that it's suing the federal government and the Lexington-Fayette Urban County Airport in this summer's crash of Comair flight 5191. Forty-nine people were killed when the plane went down the wrong runway and crashed on August 27th. Comair says it intends to reach fair settlements for the families of those killed, but it says it filed suit to make sure other parties responsible pay their fair share.

A suicide car bombing has killed a NATO soldier and eight civilians in southern Afghanistan. NATO says the bomber rammed a van packed with explosives into a NATO military patrol. The attack happened on a busy shopping street in Kandahar. It's apparently the latest in a recent surge in Taliban attacks.

Defiant words from the Palestinian prime minister. Ismail Haniyah says the militant group Hamas will never recognize Israel's right to exist. That's a key demand by the international community. Palestinian president Mahmoud Abbas has urged the Hamas-led government to recognize Israeli in order to help end crippling western sanctions.

Police are trying to figure out who killed four people found shot to death along the Florida turnpike near Port St. Lucie. Authorities say that the victims are a man, a woman, a young boy and a girl. They say that the woman was clutching the children in an apparent attempt to protect them. Police believe the victims were in a vehicle that pulled off the highway and someone in the car shot them and drove away.

A rare October snowstorm is being blamed for at least three deaths in western New York state. The storm pounded the region, downing trees and power lines and dumping up to two feet of snow. Utility crews are trying to restore electricity to about half a million customers -- Wolf?

BLITZER: My heart goes out to my fellow Buffaloians there. What a mess, Zain, thank you very much. We'll have more on that snowstorm coming up.

The United Nations Security Council plans to vote tomorrow on whether to slap sanctions on North Korea amid new questions about whether the communist regime actually conducted a nuclear test this week. U.S. government officials with access to classified information tell CNN the initial air samples over North Korea show no sign of radioactive debris. Officials emphasize this is not conclusive evidence.

Secretary of State Condoleezza Rice meanwhile announced today she will be traveling to South Korea, China and Japan next week. It's another step in a U.S. diplomatic offensive aimed at getting North Korea to drop its nuclear program.

U.N. Security Council members today are hammering out a final resolution on nonmilitary sanctions, a less tough version than previous drafts. Diplomats say the sanctions target materials for weapons, programs, and luxury goods.

And in the midst of the tensions on the Korean peninsula, the U.N. general assembly today adopted a resolution appointing the South Korean foreign minister Ban Ki-moon as the new secretary general. I'll have more on this story coming up in the next hour including a live report from Richard Roth at the United Nations.

Let's get back to the Mark Foley congressional page scandal right now. It's been having a political impact on some key house races. But one in particular stands out because of one candidate's very personal emotional concern about protecting young people. CNN's Keith Oppenheim is joining us now from Stillwater, Minnesota -- Keith.

KEITH OPPENHEIM, CNN CORRESPONDENT: Hi, Wolf. I'm in Minnesota's sixth congressional district outside the Twin Cities and this is a district that tens to lean Republican and was pretty much doing that before the Foley scandal broke. But now, it's anyone's guess who could win this one in large part because the Democratic candidate jumped on the issue.

(BEGIN VIDEOTAPE)

OPPENHEIM (voice-over): In Minnesota, Patty Wetterling is well- known. 17 years ago, her 11-year-old son, Jacob, was kidnapped and never found. She later became a national advocate for child safety. Now, Wetterling, a Democrat, is running for an open seat in Minnesota's 6th congressional district.

PATTY WETTERLING (D), MINNESOTA CONG. CANDIDATE: I want to go to Washington to be a loud, strong voice for middle class families.

OPPENHEIM: In September, Wetterling's race against Republican opponent Michele Bachmann was losing stream.

MICHELE BACHMANN (R), MINNESOTA CONG. CANDIDATE: Now, I wanted to come by and say hi.

OPPENHEIM: Bachmann, a conservative state senator, was ahead in the polls by nine points.

BACHMANN: I want to get rid of the death tax for people in this country and do some major changes on capital gain.

OPPENHEIM: Political scientist Steven Smith says Bachmann appeared confident and Wetterling unsure, often relying on her notes.

STEVEN SMITH, WASHINGTON UNIVERSITY: Until she starts talking about child safety issues and then her intensity ratchets up a few notches, you can see her energy level rise. She becomes very, very effective.

OPPENHEIM: In a strange twist, Wetterling knew Mark Foley.

UNIDENTIFIED MALE: Patty Wetterling.

OPPENHEIM: She had worked on child safety legislation with him, so when the scandal broke, Wetterling believed she had the credibility to take a big swing and ran this ad.

UNIDENTIFIED MALE: Congressional leaders have admitted covering up the predatory behavior of a Congressman who used the Internet to molest children.

OPPENHEIM: The Bachmann camp cried foul, saying Republicans never admitted to a cover-up.

BACHMANN: My opponent took this issue and rather than being interested in making sure that children were protected, she was busy lopping off the head of Republicans.

OPPENHEIM: Still, analysts say Wetterling gained. and in the latest polls she is just three points behind Michele Bachmann.

BACHMANN: Thank you for your vote.

SMITH: This is a dead heat. I think this was a race that Michele Bachmann was likely to win and now you'd have to say it's a tossup.

(END VIDEOTAPE)

OPPENHEIM: Wolf, these candidates are very different. One is a conservative Republican, and the other a moderate to left Democrat. But they have a similarity: they are moms with large families. Patty Wetterling has four children, including her lost son Jacob. She is also a grandmother of a 2-year-old. And Michele Bachmann is the mom of five kids, and she and her husband have helped raised 23 kids in foster care. Interesting.

Back to you, Wolf.

BLITZER: It's very interesting, Keith. So it's clearly crucial this seat for both the Democrats and the Republicans. They're pumping in a lot of money.

OPPENHEIM: You are absolutely right. Both camps have spent more than $2 million on this campaign and that is on each side, so this contest could go down as one of the most expensive congressional races in Minnesota history.

BLITZER: Keith Oppenheim, reporting for us from the heartland of America, Minnesota. Keith, good work.

Up next, 25 days until Election Day. Where are the two parties putting their campaign cash? And are more seats now in play? I'll ask two experts, Amy Walter and Stu Rothenberg. They're standing by live.

And later, in the battle for Congress, will the negative ads make the difference? Find out in today's "Strategy Session." Lots more coming up. You're in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: Welcome back to THE SITUATION ROOM. I'm Wolf Blitzer in Washington. Only 25 days left until America votes and decides if there will be a power shift in the U.S. Congress. It's time for our weekly update on some of the hot races and which party is making or losing headway.

We're joined, once again, by Stuart Rothenberg of the "Rothenberg Political Report," and Amy Walter of the "Cook Political Report." Guys, thanks very much for coming in. Good discussion last week, another discussion today.

Amy, was there, in this past week, any major shift that you saw in either the races for the House or the Senate?

AMY WALTER, "COOK POLITICAL REPORT": Well, there couldn't have been anything but a bad week for Republicans last week. I mean, it was the worst week they've had in a long time. But fundamentally, yes, we're seeing a significant shift in the number of seats now that Democrats can put into play. Now, I don't want to blame it all on Foley or these other scandals. I think this was building for some time. I think the Iraq war is still a very big piece of this, why these races are now becoming more competitive and the trouble that voters have right now with Congress, the frustration with Congress.

It's just that the spotlight has shown so brightly for the last week-and-a-half -- I guess we're now at two weeks -- on sort of dysfunction in Congress that we're starting to see so many of these races lose traction for Republicans.

BLITZER: So, in other words, some of those races that seemed to be very close up in the air, all of a sudden, Republican leaders are suggesting, you know what? It's not worth putting a lot of money into those races. They are effectively giving up.

STUART ROTHENBERG, "ROTHENBERG POLITICAL REPORT": There are three different categories, Wolf. One is there were races that were second tier, third tier races that we are now paying attention to and rating.

Second of all, there were races we were already paying attention to that have increased risk for the Republicans.

And then, third -- yes, absolutely right. You're right. There were races, Colorado, open seat, for example, some races in Indiana, I believe, Pennsylvania, that we felt were very competitive that we have now pushed to the Democratic side, so three kinds of changes.

BLITZER: All right. Let's talk about some specific races. Arizona 8th -- the 8th congressional district in Arizona. This is the seat that Jim Kolbe is giving up, the only openly gay Republican member of the House of Representatives. Randy Graf versus Gabrielle Giffords, what do you make of this race?

WALTER: Well, there is a category here, if we're going to talk about categories, of seats that Republicans right now are running behind, that they're effectively going to lose, that they really shouldn't be losing. This is a Republican-leaning district where Republicans should be playing and they should have a good chance here.

Right now, they got the wrong candidate that came out of the Republican primary in Graf and Republicans have essentially written this race off. No outside money from the parties is coming into this race.

BLITZER: And he's very conservative, and he's very outspoken on the issue of illegal immigration. Is that making him potentially a loser? Is that what you're suggesting?

ROTHENBERG: That is part of the problem. He is probably too conservative for this district. Wolf, this district is over. You can put it in the bank for the Democrats.

BLITZER: All right, what about this other district, Texas 22, Tom DeLay's district that he gave up. Shelley Gibbs versus Nick Lampson. It looks like Nick Lampson is now way ahead.

WALTER: Yes, Shelley Gibbs isn't even on the ballot. She has to win as a write-in candidate in electronic voting, which is even harder than it seems. Again, this is a number -- if we're talking about the playing field expanding, these two races right here are ones that Democrats can essentially put in the bank.

So they're starting election night with already at least six, eight, maybe even 10 races that right now I think they're going to win. We're not even talking about what the environment is going to look like on the election so that's adding a whole 'nother layer on top of that.

BLITZER: And they need 15 to become the majority in the House of Representatives so if they could take this district in Texas, in Houston, Tom DeLay's old district, Sugarland, that would be a significant bonanza for the Democrats.

ROTHENBERG: Wolf, a year, year-and-a-half ago if you said the Democrats were going to win this district, we would have just laughed you out of the room. We would have just thought you were crazy, but they're likely to win it. This is a good example. There's a handful of races like this that shouldn't be on the table. They're not only the table, the Democrats are taking them off the table for their side.

BLITZER: All right, let's talk a little bit about the Senate. First of all, in Missouri, a close contest, I think everybody agrees, the incumbent senator, Jim Talent, the Republican, versus Claire McCaskill. How's that going?

WALTER: Well, we talked about this a little bit last week, about this firewall strategy, and the fact, right now, that, when it comes down to control of the Senate, there are these three or four seats that Republicans are using right now to protect their majority. Missouri is one of them. The other one is Tennessee, is -- which we will be talking about, I'm sure, and Virginia.

BLITZER: We're going to get to that?

ROTHENBERG: Yes.

BLITZER: But what about Missouri?

ROTHENBERG: Well, they're -- the Republicans -- both sides are playing heavily with money.

Talent, Jim Talent, Senator Talent, has gone up on the air with a nursing home ad, the same kind of message that defeated Claire McCaskill when she ran for governor a couple of years ago. This should be a relatively easy race for the Republicans. The environment stinks. And it is an absolute dead heat.

BLITZER: Did that debate they had have any impact, based on what you can tell?

(CROSSTALK) ROTHENBERG: I don't think it fundamentally changed the race, though it's really hard to move numbers, actually, this late in the election, with only a few weeks to go. People have seen weeks of ads already. They know who the candidates are. You need a particular message, something to cut through.

BLITZER: Tennessee, an important race, Bob Corker running against Congressman Harold Ford Jr. This is Senator Bill Frist's Senate seat that he is giving up. How is that looking?

(CROSSTALK)

WALTER: Well, that is another one that has gotten a great deal of national attention in the last couple of weeks, simply because people didn't expect it to continue to be as competitive as it is once Corker won the primary.

The fact that Harold Ford, the Democrat, is staying in contention here, that this is a very close race, again, another dead-heat, tossup kind of race, is pretty remarkable. And, again, I agree with Stu that it's really in this last week or so, when these races start to break, that seats like this, you're going to start to see...

(CROSSTALK)

BLITZER: The fact that a Democrat is potentially at play in a red state like Tennessee, especially an African-American Democrat, that has a potential resonant -- people are going to be paying attention, closely...

ROTHENBERG: Absolutely.

BLITZER: ... if this happens.

ROTHENBERG: First of all, Harold Ford is actually ahead in this race by a few points. It's close. It's competitive, but he's ahead.

Second of all, he has probably run one of the best campaigns in the country. I mean, you want to talk about Michael Steele or Tom Kean, but you have to say Harold Ford is up there. He has been a terrific candidate. And he may actually have won this race in August, July, August, and September.

Corker, up until the -- early August, was distracted in a primary, has not sufficiently attacked him, painted him as a liberal. This would be a significant upset, if Harold Ford could pull it off. And I think he absolutely has a reasonable chance of doing that.

BLITZER: Three-and-a-half weeks to go.

Virginia, this was not supposed to be...

WALTER: That's right.

BLITZER: ... a close race at all. The incumbent, George Allen, he is fighting for his life right now against the former Navy Secretary Jim Webb.

WALTER: Well, and it's -- really, the question remains, can he use these next couple of weeks here -- he being George Allen -- to get himself back on the offensive?

If we think about this firewall strategy, again, Republicans cannot afford to lose all three of these seats that we just talked about. So, being able to hold on to one or two of those is going to provide the margin for them. Whether -- I think, a while back, it was considered that it was Tennessee was going to be that place. Right now, it looks like Virginia is going to be just as important.

BLITZER: People think Virginia is a Southern state, but the northern part of Virginia has been booming in recent years. A lot of people have moved in from all parts of the country.

ROTHENBERG: Absolutely.

And the Democrats recently won the governorship. Allen is on now with a new TV spot featuring his wife, saying George Allen is a wonderful husband and a wonderful father and a wonderful senator.

His problem is, he doesn't have a lot of wedge issues against Jim Webb, the Democratic candidate. And, so, now that the race is close, he is having a hard time blowing it open again.

BLITZER: The one Senate race where a Democrat, an incumbent Democrat, is in trouble is New Jersey, Bob Menendez. He is fighting for his life against right now against Tom Kean Jr.

WALTER: Yes. But I would much rather be a Democrat in this political environment than a Republican. And I would certainly much rather be a Democrat in a really blue state like this one.

I mean, I think that alone is helping him. We have seen recent polls that show that Menendez is -- is up a few points here. So, I think when you're talking about where the momentum is shifting, don't you think that Menendez is the one who is...

(CROSSTALK)

ROTHENBERG: Yes.

(CROSSTALK)

ROTHENBERG: Right.

I think Menendez is a narrow favorite here. He's up by a few points.

But it's interesting. Kean -- and this also holds for Michael Steele in Maryland -- they have been able to swim against the tide by running as outsiders, talking about change, talking about ethics. Most Republican candidates are just being swept away by the change message. The only Republicans who have a chance are being able to -- are portraying themselves as outsiders. BLITZER: Stu and Amy, thanks very much.

WALTER: Thanks.

BLITZER: We will be seeing you right here in THE SITUATION ROOM next week, and every week, as we come closer to November 7.

WALTER: Great.

BLITZER: Thanks very much.

Up next: Bob Ney pleads guilty, but refuses to quit Congress, at least for now. Will the culture of corruption influence voters in November? I will ask Donna Brazile and J.C. Watts in today's "Strategy Session."

Plus: some controversial comments from a congressman facing a very, very tough reelection. We are going to tell you what Chris Shays is saying in today's "Political Radar."

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

(COMMERCIAL BREAK)

BLITZER: Welcome back.

He has just pleaded guilty in the Jack Abramoff lobbying scandal, but, so far, Bob Ney is still a member of the United States Congress. That has got leading Republicans vowing to kick him out, if he doesn't go voluntarily.

Joining us now to discuss this and other issues, our political analysts, Democratic strategist Donna Brazile, and former Republican Congressman J.C. Watts.

Here's a joint statement, J.C. I want you to react to this, from what the -- the leadership in the House said: "Bob Ney must be punished for the criminal actions that he has acknowledged. He betrayed his oath of office and violated the trust of those he represented in the House. There is no place for him in this Congress. If he chooses not to resign his office, we will move to expel him immediately as our first order of business when Congress resumes its legislative work in November."

These are the House Republican leaders.

J.C. WATTS, CNN POLITICAL ANALYST: Well, and, Wolf, what other course of action do they have, if the member has said, I'm guilty; I'm guilty, Your Honor?

BLITZER: He pleaded guilty.

(CROSSTALK)

WATTS: He did. And, so, I don't know. It -- it puts on the leadership in somewhat of a difficult position to have to do that to a colleague, but, if the colleague has said, I'm guilty, what else do you do? I do think that's the appropriate action to take.

BLITZER: He's awaiting sentencing right now, because he -- he was in court earlier today.

How should the Democrats deal with this, if they should at all?

DONNA BRAZILE, CNN POLITICAL ANALYST: Well be, first of all, Nancy Pelosi also put out a statement today that Mr. Ney should step down.

And she -- I'm sure if the speaker decides to call a special session next week to expel him, I'm sure the Democrats will come back to Washington for a couple hours to expel him. I think he should step down. That's the honorable thing to do. He pleaded guilty.

BLITZER: Well, the Republicans say they want to wait until November, after the elections.

BRAZILE: I don't think they should wait one more hour. He pleaded guilty. He should step down. There is no reason why he should stay in Congress right now.

BLITZER: What do you think?

WATTS: Well, I -- Wolf, again, I think...

(CROSSTALK)

BLITZER: I mean, should they come back early and give up the campaigning to expel him right away?

WATTS: Well, you know, I think they can deal with it next week. They can deal with it after the elections. But I do think it's the right thing to do for the speaker, for the leadership to issue that statement today, simply -- what -- they have no wiggle room.

This is a shut -- a slam-shut case, slam-dunk case. So, if they come back next week, that's fine, but I don't think the American people are going to be upset if they don't. I mean, he is guilty.

BRAZILE: Well, they drafted a letter for Mr. Foley. And, apparently, Mr. Foley signed it when he resigned a couple of weeks ago.

They should draft a letter for Mr. Ney and say, sign this letter. There's no reason for him to stay on. I'm sure he has collected his congressional pay for the month of October. It's time for him to move on and prepare for two-and-a-half years in jail. That's what -- he has been sentenced to 27 months in jail.

WATTS: And I think, from a -- you know, from a budgetary standpoint, it would be much easier to draft a letter.

I mean, having everybody come back into the district -- I mean, come back into Congress, disrupt schedules, family schedules, campaign schedules, everything else -- you know, good point. Draft a letter. Say, sign this. It's over.

BLITZER: Let's shift gears, talk about a very close Senate race that is shaping up right here outside of Washington, D.C., in the state of Maryland.

Michael Steele is the Republican. Ben Cardin is the Democrat. This is the Sarbanes, the Paul Sarbanes, seat that he is giving up, as he retires.

Let's listen a little bit of their most recent ads. Watch this.

(BEGIN VIDEO CLIP)

NARRATOR: The truth about Michael Steele? Check the facts. Recruited by Bush and Cheney, taken $6 million in special interest, money, supports Bush's plan to privatize Social Security and Bush's war in Iraq. Now Steele wants you to believe he will follow his own convictions. The truth?

LT. GOV. MICHAEL STEELE (R-MD), MARYLAND SENATORIAL CANDIDATE: The standard bearer of these convictions is George W. Bush.

NARRATOR: Michael Steele, right for Bush, wrong for Maryland.

BEN CARDIN (D), MARYLAND SENATORIAL CANDIDATE: I'm Ben Cardin, and I approve this message.

(END VIDEO CLIP)

(BEGIN VIDEO CLIP)

STEELE: Smell it? Trash from my opponent. Time to take it out.

First, Ben Cardin's team hacks into my credit report, steals my Social Security number. Oh, yeah. They pled guilty in federal court.

Then, the personal smears. You know the type?

Now he says I'm in the president's hip pocket.

Listen for me, Mr. Cardin. I think for myself. After 40 years in office, Ben Cardin can't change Washington.

But you and I can.

I'm Michael Steele, and this is my message. Smell it?

(END VIDEO CLIP)

BLITZER: All right, let's assess those two commercials.

What do you make of them? Both pretty good.

BRAZILE: Well, look, early on, Lieutenant Governor Steele had an ad with -- using his dog, and basically said that they're going to accuse me of not liking pets. And, then, of course, the Democrats came back with an ad, saying it's not the pets we're worried about; it's your record.

So, I think this is going to be one of those interesting...

BLITZER: It's not so much his record. What they're complaining about is, he is in line with Bush.

BRAZILE: Oh, no question.

And President Bush is a liability in Maryland. Maryland is a reliable blue state. And I do believe that Michael Steele is trying to distinguish himself by saying: I'm going to be an independent voice.

But Ben Cardin is tying him to George Bush, George Bush policy, and the Republicans in general.

BLITZER: What do you think?

WATTS: You know, Wolf, I can see them, you know, pointing to George Bush, and trying to tie him to George Bush. But let's separate that out. If they want to talk about Michael Steele's record, he's got a very good record.

I think Michael Steele has been a very nontraditional Republican, in terms of what he has tried to do for all communities. He's reached out to the African-American community. He's reached out to Democrats. I think Michael Steele has been a good representative for the people.

Now, that ad, you know, I don't like it, because Michael Steele is a friend. Now, that's the nature of the beast this time of the year. And those things are going to happen.

BLITZER: Do these attack ads -- at this point in an election, three-and-a-half weeks out, do these attack ads -- you're a former congressman -- work?

WATTS: Wolf, they do.

BLITZER: That's why they do them.

WATTS: Unfortunately...

BRAZILE: Absolutely.

(CROSSTALK)

WATTS: ... they do.

And it -- right. That's why they do them. And I think -- but in this type of atmosphere, or during a campaign, you have got to respond. That was Michael's response that we saw as well. And I thought it was a good response. But...

BLITZER: It was a pretty good response, don't you think? Forget about Democrat, Republican. From his perspective, Michael Steele, that was a pretty good response.

BRAZILE: Well, everyone expects you to run attack ads.

What they expect the candidates to do is try to also lay out the facts. And what the ad failed to do is to say: Look, I may support the president on these issues, but I don't support him on this.

And I think what Michael Steele ultimately will have to do is to distinguish himself from the Republicans in Washington, and to President Bush as well.

(CROSSTALK)

BLITZER: Some of his other ads, by the way, he does criticize Republicans and Democrats, trying to establish himself as an independent.

Guys, we got to leave it right there, because I'm told we are completely out of time.

WATTS: Out of time?

BLITZER: Yes. But I'm going to say this to both of you.

Donna Brazile and J.C. Watts are part of the best political team on television.

(LAUGHTER)

BLITZER: And, remember, for all the latest campaign news at any time, check out the Political Ticker. J.C. and Donna do it all the time. They go to CNN.com/ticker.

Coming up: Al Gore does something he hasn't done in six years. Find out what that is in today's "Political Radar."

And Britain's top army commander drops a bombshell about the war in Iraq -- why the British prime minister, Tony Blair, apparently now says he agrees with him. That's coming up in our next hour.

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

(COMMERCIAL BREAK)

BLITZER: Here is what on our "Political Radar" this Friday.

Former President Bill Clinton campaigned in California today for Proposition 87, calling it the state's way to energy independence. The measure would tax companies drilling for oil until $4 billion is raised to fund alternative energy research.

Former Vice President Al Gore also promoting Proposition 87 on the airwaves. Gore is appearing in his first political ad since he ran for president back in 2000. The oil industry is fighting the ballot initiative. And recent polls suggest it's losing support among voters.

Congressman Chris Shays appears to be standing behind a controversial claim that the Abu Ghraib prison scandal in Iraq was not about torture; it was about a sex ring. The Connecticut Republican made that claim during a debate Wednesday against his Democratic opponent, Diane Farrell. The Associated Press contacted Shays today. He reportedly told AP that a National Guard unit run amuck for sex abuse and pornography was at work at Abu Ghraib.

And a new poll in New Hampshire shows Senator John McCain and Hillary Rodham Clinton are the most popular potential presidential candidates for their party's nomination in 2008. McCain drew the most support among New Hampshire Republicans, with 32 percent support. His nearest GOP rival, Rudy Giuliani, got 19 percent. Hillary Clinton was favored by 30 percent of New Hampshire Democrats -- John Edwards, a distant second, with 16 percent.

Up next, Jack Cafferty is standing by. He's wondering about some stunning comments by America's closest ally in the Iraq war. What does it mean for the U.S. when Britain's top army commander says it's time to leave Iraq soon?

Stay with us. Jack will be back. That's coming up next.

(COMMERCIAL BREAK)

BLITZER: Here is a look at some of the "Hot Shots" coming in from our friends at the Associated Press, pictures likely to be in your hometown newspapers tomorrow.

Jerusalem: Israeli police on horseback scuffle with a group of Palestinians waiting to cross a checkpoint into the West Bank.

In California, Senator Barbara Boxer embraces former San Francisco Mayor Willie Brown Jr. at a fund-raiser.

Alajuela, Costa Rica: Children dressed as chickens and eggs celebrate what is called World Egg Day.

And, at a zoo in Santiago, Chile, a veterinarian shares a moment with a young giraffe -- some of today's "Hot Shots," pictures often worth 1,000 words.

Jack Cafferty is back with us with "The Cafferty File" -- Jack.

CAFFERTY: National Egg Day, I missed that one.

BLITZER: Have you been celebrating it?

CAFFERTY: No. I wasn't aware we had such a thing. But I will put it on my calendar for next year.

BLITZER: Good.

CAFFERTY: What does it mean, is the question this hour, for the United States when the British army chief says it's time to leave Iraq soon?

Cy in Arlington, Virginia, writes, "It means the coalition of the willing is becoming the coalition of the dragged kicking and screaming."

John writes: "It seems clear to me that leave soon means leave soon. They have heard their own people, who overwhelmingly disapprove of Blair's support of the war. And he is on the way out."

Jason in Washington says: "It means that some of the British leaders are not on as tight a leash as Bush administration officials. Sometimes, they slip up and tell the truth. We could use some of that accidental honesty here at home."

Dan in Cincinnati: "Hi, Jack. His statement means pull out the size 50-dress, reinforce the stage floor, because the fat lady is about to sing."

Jenny in New York: "It means Laura and Barney better not go wobbly on George, or it's all over."

(COUGHING)

CAFFERTY: Excuse me.

And Ben in Miami Shores, Florida: "It's pretty clear to me that this new statement by the British official means, Jack, he can expect an invite from Dick Cheney to go fox hunting."

This weekend, on "IN THE MONEY," a political economist, Greg Valliere, handicaps the upcoming midterm elections, talk about what issues are likely to drive voters to the polls.

"IN THE MONEY" airs Saturday at 1:00, Sundays at 3:00 Eastern time. And we invite you to join us.

Greg is a very bright guy. And he has some interesting thoughts on what may be the determining factors in this election -- Wolf.

BLITZER: He has always got a lot of good insight. It's a good show, "IN THE MONEY WITH JACK CAFFERTY," Saturdays and Sundays.

I want our viewers to check it out, Jack.

CAFFERTY: Thank you, Wolf.

BLITZER: All right. Good work.

Still to come: President Bush takes aim at terrorists and some gamblers. We are going to tell you what he has been up to today.

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

(COMMERCIAL BREAK)

BLITZER: Let's check back with Zain. There's a story developing right now -- Zain.

VERJEE: Wolf, authorities in Burlington, Vermont, say that they found the body of a woman.

They are temporarily I.D.ing this body as Michelle Gardner-Quinn. That's the missing University of Vermont student. She was missing since October the 7th. Police say that they think it's a homicide. They have a suspect in custody. They haven't released any more details, Wolf, but we will bring you more when we get it.

BLITZER: What a heartbreaking story that is, Zain. Thank you very much for that.

President Bush says, a new law he signed today shows, the U.S. is determined to protect America's seaports from terrorists. He says the measure allows for high-tech inspections of millions of shipping containers that enter this country from foreign ports, without having to open them.

One aspect of the port security bill was not mentioned by President Bush today, an unrelated amendment seeking to clamp down on Internet gambling. The provision was attached to the ports bill at the last minute, as Congress scrambled to finish business before going home to campaign.

So, how is the lucrative online gambling industry responding?

Abbi Tatton standing by with details -- Abbi.

ABBI TATTON, CNN INTERNET REPORTER: Wolf, this legislation follows the money behind online gambling. And there's a lot of it. It's a $12 billion industry. Estimates put about half of that revenue as coming from here in the U.S., although many of these Web site, these companies, are based overseas, making them, in the past, hard to regulate.

Now, the legislation signed by President Bush today prohibits U.S. players from using U.S. credit cards and other accounts to pay for their online wages. And it's going to prohibit the banks and ask the banks and other financial institutions to block those transactions.

Now, we're already seeing some repercussions online. This U.K.- based betting site, Sportingbet, updated its site this morning to say it's no longer accepting payments from U.S. citizens. It also said it sold its entire U.S. operation for $1 today.

But other sites are not going so quietly -- poker players online saying theirs is a game of skill, and so, they should not be affected by this legislation -- Wolf.

BLITZER: Abbi, thank you.

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