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THE SITUATION ROOM

Defense Secretary Donald Rumsfeld Stepping Down Amid Public Anger Over Iraq War; Henry Kissinger Interview; In Virginia Two Men Carry Fate Of Senate On Their Shoulders; Nancy Pelosi Interview

Aired November 8, 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, the aftershock from an election earthquake. Defense Secretary Donald Rumsfeld resigns and a lame duck president apparently picks a replacement.

Will there be a change of course in Iraq?

Big changes ahead in Congress, where Democrats clean house. I'll have a special interview with Nancy Pelosi, slated to serve as the first woman speaker of the House.

And a see-saw struggle for control of the Senate. One last race still too close to call.

We'll take you to the battleground in Virginia.

I'm Wolf Blitzer live on Capitol Hill, at the center of this election upheaval. You're in THE SITUATION ROOM.

A groundswell of voter outrage shocks the foundations here on Capitol Hill, and rocks the White House. The first pillar to fall, Defense Secretary Donald Rumsfeld, stepping down amid public anger over the Iraq war.

President Bush picks a replacement, but Democrats feel they can now call the shots, at least many of them.

Only one seat may stand in the way of their control of the U.S. Senate, but it's still a cliff hanger in Virginia. Take over of the House already in the works. I'll speak with the Democratic leader, Nancy Pelosi. She's set to become America's first female speaker of the House.

Standing by, our senior Pentagon correspondent, Jamie McIntyre; CNN's Michael Ware in Baghdad.

But let's begin with our White House correspondent, Suzanne Malveaux -- Suzanne.

SUZANNE MALVEAUX, CNN WHITE HOUSE CORRESPONDENT: Well, Wolf, as you know, Don Rumsfeld is out, Bob Gates is in. Is it really a stunning turnaround for this president, at least publicly. The news broke just before the press conference occurred in the East Room. Blackberries were buzzing. We had some hint of something afoot when White House officials refused to actually rule out the possibility that there would be a major announcement and a personnel announcement. And that, of course, is when the news broke.

The president making that news in the East Room. And, of course, the reason why this was so surprising, it was just a week ago that the president, in a print interview, outright rejected the possibility of Rumsfeld stepping down, saying he would take him through the remainder of his second term.

But that, of course, is not happening. President Bush acknowledged that he was less than forthcoming with reporters today, saying that he and Rumsfeld actually had a series of meetings about the possibility of him stepping down and that it wasn't until Sunday in Crawford when he met with his potential replacement.

(BEGIN VIDEO CLIP)

GEORGE BUSH, PRESIDENT OF THE UNITED STATES: In this time of war, the president relies on the secretary of defense to provide military advice and direct our nation's armed forces as they engage our enemies across the world. The secretary of defense must be a man of vision who can see threats still over the horizon and prepare our nation to meet them.

Bob Gates is the right man to meet both of these critical challenges.

(END VIDEO CLIP)

(BEGIN VIDEO CLIP)

DONALD RUMSFELD, SECRETARY OF DEFENSE: For six years -- it's been quite a time. It recalls to mind the statement by Winston Churchill, something to the effect that I have benefited greatly from criticism, and at no time have I suffered a lack thereof.

(END VIDEO CLIP)

MALVEAUX: And, Wolf, President Bush saying that the reason why he wasn't forthcoming about Rumsfeld potentially stepping down, he didn't want to influence the mid-term elections and interfere with the political climate here.

But, of course, Wolf, this is really part conciliatory, but also partly political calculation, as well. Republican strategists, as well as friends of the White House and even some lawmakers quietly going to the White House, suggesting that they needed to do something dramatic, they needed to do it quickly, that the elections essentially was a referendum on the president and his Iraq war -- Wolf.

BLITZER: All right, Suzanne, thanks very much. For almost half a dozen years, Donald Rumsfeld worked his will at the Pentagon. But voters angry over the war in Iraq have now made their will clear.

Let's go live to our senior political correspondent, Jamie McIntyre -- Jamie, what does the defense secretary's departure actually mean for the management of the war in Iraq?

JAMIE MCINTYRE, CNN SENIOR PENTAGON CORRESPONDENT: Well, it means a couple of things, Wolf.

One, of course, is it's a conciliatory gesture to Democrats on the Hill, who had been calling for Rumsfeld's resignation for quite some time. It also, obviously, does clear the decks, provides, in the president's words, a chance for a fresh perspective on what's going on in Iraq. And, by selecting Bob Gates as the new defense secretary, assuming he's confirmed, it gives more credence to the Iraq Study Group, of which he was a member, which has been studying, giving briefings, trying to come up with options for a major course correction.

Without Rumsfeld at the helm, the chances for a major change in policy are greater because you won't have Rumsfeld arguing for the current policy, which he continues to believe is the right one -- Wolf.

BLITZER: And what's the buzz in the corridors over there at the Pentagon?

I'm sure it must have caused quite a jolt.

MCINTYRE: Yes, a big surprise.

Nobody saw this coming, as far as I can tell. Most of the key Rumsfeld aides who came in this morning were in meetings with him and he didn't give a clue that this was up until about mid-morning, when he started to brief some of the senior people.

So, a big shock, particularly because President Bush had just given him another endorsement.

BLITZER: Jamie McIntyre, thank you very much.

So what impact will the departure of Donald Rumsfeld and the political turnabout here in Washington have on the war in Iraq?

Let's turn to CNN's Michael Ware.

He joins us live from Baghdad -- what's the likely reaction going to be, first of all, in the Iraqi government of the prime minister, Nouri al-Maliki?

MICHAEL WARE, CNN CORRESPONDENT: Well, Wolf, I mean, clearly the Iraqi government has no influence over the appointments within the U.S. administration. Indeed, the administration makes it very clear that Iraq itself is a sovereign government. I mean, really, they're just going to have to accept this, obviously, and they're going to have to work with whomever is in the position that has now seen -- been filled -- Wolf.

BLITZER: What about the insurgents or the terrorists or those who presumably might say, you know what? This is a victory for the insurgency, those who are against the United States. It's a sign of American weakness. That could cause, potentially, some serious ramifications.

WARE: Certainly. I think you will see the insurgent propaganda campaign intent to capitalize on this in any way it can. I mean it's leapt on every opportunity that has come its way in the past and as we are well aware, they monitored this election very closely.

So the aftershock, they're saying, with the departure of Secretary Rumsfeld, will have registered out in the insurgency and they'll very clearly start including that now in their information operations or propaganda.

BLITZER: And there was a strong message sent from Washington -- don't misread what is happening because U.S. resolve, according to the White House, still remains strong in dealing with the insurgency, in dealing with the war in Iraq.

On a day to day basis, though, as you talk to U.S. troops -- and you've been embedded with a lot of U.S. military personnel over these past three years plus -- what do you sense they're saying to themselves as they are on the front lines actually fighting this war?

WARE: Well, Wolf, someone here in Baghdad, be it the soldiers, be it people from the State Department, be it contractors, be it anyone involved with the U.S. mission here, the big question now is what will this mean to us here on the ground? Is this going to be a shift?

I mean there's been many schools of thought, within military circles, political circles, within strategic analytical circles about the path for this war, about assessing the true nature of this war, what the problems really are and how to address them.

So they will be asking does this change that? Is this a signal of any kind of shift in policy or in thinking? And most urgently, one wonders what the generals must be thinking?

They'll now be wondering what will happen if they ask for more troops, if they ask for a different kind of composition of their forces.

Who is going to decide? Is there a clear policy line?

Everyone is going to be asking themselves these kinds of questions -- what does it mean, Wolf?

BLITZER: Michael Ware reporting for us from Baghdad.

Michael, thank you. Let's go to Jack in New York with "The Cafferty File" -- Jack.

JACK CAFFERTY, CNN ANCHOR: "We took a whipping last night and we understand that."

That was former House Majority Leader Tom DeLay. He says the Republicans lost the majority in the House because not enough of them came out to vote and because GOP leaders didn't tell the voters what they stood for.

DeLay went as far as to say: "The Democrats didn't win, the Republicans lost." He added: "The Democrats voted against Republicans because of the war in Iraq." But he says he holds out hope for the future and thinks that if the GOP members fight for what they believe in, the public will support them and they'll have the chance to took back the House in 2008.

DeLay resigned after being indicted on state money laundering charges in Texas and CNN projects that Democrat Nick Lampson won "The Hammer's" former Congressional seat in that district in Texas.

The question is this, then. Tom DeLay says the Democrats didn't win, the Republicans lost.

Is he right?

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

BLITZER: All right, Jack, thank you.

Up ahead, a Capitol Hill cliff hanger. The plot thickens over who will control the U.S. Senate, as the Virginia Senate race lies undecided still.

Also, Nancy Pelosi poised to become the first ever female speaker of the House. I'll speak with her one-on-one about the privilege and the perils of the Democrats' newly acquired power.

And resignation ramifications -- might Donald Rumsfeld's departure signal a major turning point for the war?

I'll ask the former secretary of state, Henry Kissinger. He's standing by live.

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

(COMMERCIAL BREAK)

BLITZER: I'm Wolf Blitzer.

We're live on Capitol Hill.

A generation ago, he helped preside over another unpopular war. That was in Vietnam. He helped see it through to its conclusion.

And joining us now, the former national security adviser, the former secretary of state, Dr. Henry Kissinger.

Dr. Kissinger, thanks for coming in.

DR. HENRY KISSINGER, FORMER SECRETARY OF STATE: Well, it's good to be here.

BLITZER: What do you make of this bombshell -- we'll start off with Donald Rumsfeld's resignation today on this, the day after the election?

KISSINGER: Well, Rumsfeld is a great patriot. And he must have decided he was drawing too much fire, it would be too difficult to carry out his tasks and that he wanted to provide a opportunity for a different perspective. The facts won't change, but maybe ...

(CROSSTALK)

BLITZER: Because the conclusion from the electorate, from the American people who voted, is that this war is very unpopular. An enormous amount -- it was, in effect, a referendum on the war and on the Bush presidency.

KISSINGER: Except that there are certain objective conditions which don't necessarily respond to what the vote is. I mean we don't want a Taliban in Iraq. We don't want terrorists to be trained in Iraq.

BLITZER: But that looks, to a lot of voters out there, a lot of Americans, that that's exactly what's happening, despite the enormous -- the enormous initiative, the enormous effort underway.

KISSINGER: Well, there's no doubt but the president has asked for the reassessment. And he's asked the Baker Commission to make a report. And all of us who are concerned with foreign policy and with bipartisan foreign policy will approach that effort with sympathy and with an attitude that we'll try to support it.

BLITZER: How does the United States, the Bush administration right now, convince the insurgents, the terrorists out there, that they're not winning, because a lot of them are going to conclude by the way the American public voted -- repudiating the president's policy, in effect -- and by the decision of Rumsfeld, who was one of the architects of this war, to step down, they inevitably are going to conclude they're winning.

KISSINGER: Well, that's the...

BLITZER: This is a problem.

KISSINGER: That's the problem in any guerrilla war, that the guerrillas think that just as long as they can keep themselves from losing, eventually they'll win because the support for the effort will disappear. That is the dilemma and our national debate has to be conducted on the premise of facing the consequences of whatever decisions we make.

BLITZER: You see the similarities -- you have to see the similarities between now and Vietnam.

KISSINGER: Well, there was a difference in Vietnam. In Vietnam there was a country and government. In Vietnam, in the period of the war that the administration which I served inherited -- because we didn't start that war. We inherited it from a previous administration. And the period we inherited it, there was very little guerrilla war. It was mainly a regular conventional war. And we were gaining in that guerrilla war -- in that conventional war.

So, Vietnam was an aspect of the Cold War. This is an aspect of a guerrilla war and of a terrorist effort. They are not the same situation.

BLITZER: How does the Democratic victory in the House of Representatives, and maybe even in the United States Senate, impact the final two years of the Bush administration in waging this policy, this war in Iraq?

KISSINGER: Well, these wars or no war can be run-if it isn't conducted on a bipartisan basis, whatever the election is, because when the country gets divided, then the enemy is bound to believe that he only has to hold on.

Now, the fact that there has been a Democratic victory makes the need for bipartisanship even more urgent.

But both parties have to keep in mind that after the next presidential election, the legacies of whatever happens now will still be with us, so that we should try to establish a bipartisanship, not only for two years, but for a considerable period of time, to see us through this crisis.

BLITZER: In Bob Woodward's new book, "State of Denial," he reports extensively on what he says is your extraordinary influence inside the White House, that you meet regularly with the president and the vice president to offer advice.

You're here in Washington.

May I ask you if you've met with the president or the vice president on this trip to give them some advice?

KISSINGER: No, I haven't met. And I don't come to Washington to volunteer advice.

BLITZER: But they ask you for it.

KISSINGER: When I am asked, I offer advice. But I've literally just arrived and the first person -- the second person I've seen here...

BLITZER: So you're giving us advice, right?

KISSINGER: ... it's you. So...

BLITZER: Will you be heading over to the White House? KISSINGER: Probably tomorrow.

BLITZER: Problem tomorrow.

KISSINGER: But not to see the president.

BLITZER: But, and without going into too much confidentiality, in a nutshell, can you share with our viewers what you think the administration should be doing at this critical moment right now?

KISSINGER: I think that administration should do essentially what the president today said we would do -- emphasize bipartisanship, and not just in rhetoric, but in practice.

Secondly, to try to get an assessment of the situation that a group of responsible people support. And then to design a policy that achieves as many of the objectives as our public wants. And if we find we cannot achieve all of these, to tell the public honestly, as I know they will want to, why for the sake of their children and for the sake of their own security, some modifications have to be carried out in what the -- what the public seems to have asked for yesterday.

BLITZER: We'll leave it right there.

Dr. Kissinger, as usual, thanks very much for coming in.

KISSINGER: A pleasure to see you.

BLITZER: And coming up next, celebration on hold. Democrats and Republicans hope to celebrate a win in the Virginia Senate race. But that might not happen for weeks. We're going to tell you what's going on.

And one-on-one with the woman who would become the first female secretary -- excuse me -- speaker of the House. I'll ask Nancy Pelosi how she feels about this potentially major moment in American history.

We'll be right back.

(COMMERCIAL BREAK)

BLITZER: And this just coming into THE SITUATION ROOM.

Another pickup for the House Democrats in a race that was dominated by debate about the war in Iraq.

Democrat and Iraq war veteran Patrick Murphy has won the Congressional seat in Pennsylvania's 8th District, outside Philadelphia. He defeated Republican incumbent Mike Fitzpatrick. Murphy portrayed Fitzpatrick as being willing to go along with President Bush.

Another major pick up for the Democrats in the House.

One day after election day, a Capitol Hill cliffhanger continues. In Virginia, two men carry the fate of the Senate on their shoulders right now. And in Montana, one man claims victory, while his opponent so far refusing to concede. We'll have more on that showdown out West in a moment from CNN's Dan Simon in Billings, Montana.

But first, let's go to CNN's Brian Todd.

He's watching the dramatic developments unfold in Virginia from the state capital in Richmond -- Brian.

BRIAN TODD, CNN CORRESPONDENT: Wolf, tonight, 24 hours after you brought everyone the news that this was all unfolding, almost 24 hours later, we have a situation where the Republican incumbent, Senator George Allen, is on the verge not only of losing his seat, but of losing the Republicans' majority in the Senate.

Mr. Allen, we have not heard from him today. We have heard from members of his staff. They all seem to be girding for a recount. They say that they are going to respect this process as it goes forward, as the precincts and everything is being canvassed right now to make sure the votes were tallied correctly.

But they are making statements to indicate that they believe there were some irregularities in this vote. They had some of their attorneys speak at a news conference earlier today. They're giving all indications that they will contend this vote very, very closely.

James Webb, on the other hand, Democrat, is basking in what he believes is a victory. His margin right now is only about 7,000 votes. That's less than 1 percent of the entire vote in this state. But Mr. Webb is already acting like a senator-elect and we will see, in a couple of weeks, when this recount comes to pass -- and it likely will -- what will develop -- Wolf.

BLITZER: All right, Brian, thanks very much.

I'll continue to watch it with you.

Let's go to the other nail biter out there, the Senate race in Montana. There victory is being claimed but it's not yet officially declared.

CNN's Dan Simon joining us now with the latest -- Dan.

DAN SIMON, CNN CORRESPONDENT: Wolf, while CNN and others are declaring John Tester the winner in this race, Senator Conrad Burns not ready to throw in the towel.

A few minutes ago, we received a statement from Senator Burns and it says: "John Tester ran a good race and he has the lead right now, but it is extremely close. The state of Montana has a process in place and it is our obligation to see it through. There are still votes out there that deserve to be counted."

Well, in terms of where we are right now with the vote, CNN has Mr. Tester leading by about 3,000 votes. In order to for there to be a recount, the margin of victory has to be within 1/2 of 1 percent. That would put it at only 2,000 votes. So at this point, if the numbers hold up, John Tester will be the next senator from the state of Montana.

Earlier today, he declared victory. He called on Senator Burns to concede. But at this point he's not willing to do just that -- Wolf, back to you.

BLITZER: We'll stay on top of this story, as well, Dan.

Thanks very much.

And coming up, the woman who would become the first female speaker of the House. She's reacting to Donald Rumsfeld's resignation. Nancy Pelosi telling us just how she feels about that and a lot more in my special one-on-one interview with her.

And in other Rumsfeld reactions, how are members of the U.S. military responding to the defense secretary's intention to depart his post?

Stay with us.

We'll be right back.

(COMMERCIAL BREAK)

BLITZER: It's been an election earthquake, as Democrats win control of the House and may yet do the exact same thing in the Senate.

Set to take over one of the most powerful positions in the country is Congresswoman Nancy Pelosi of California, currently the House minority leader.

I sat down with her for a one-on-one interview just a little while ago.

(BEGIN VIDEOTAPE)

BLITZER: Thanks very much for joining us.

REP. NANCY PELOSI (D-CA), MINORITY LEADER: My pleasure.

BLITZER: I don't know whether to call you Madam Speaker Designate, or what's the formal title until you're actually sworn in as speaker, what, January 3rd?

PELOSI: Well, this week, still Nancy.

BLITZER: No, I'm not going to call you Nancy, but the president, when he spoke with you on the phone this morning, he called you...

PELOSI: He called me speaker elect, but technically a caucus still has to act. Once they act, and then it's the speaker is a constitutional officer elected by the House of Representatives, so that happens in the first week of January. BLITZER: I'll call you congresswoman for the time being.

PELOSI: There we go.

BLITZER: But they'll be plenty of time later to call you speaker.

It's obviously an historic moment, a woman becoming speaker of the House of Representatives. What is the impact? What does that mean for you?

PELOSI: Well, what it means for our country, I think, is something very important. The Congress is, of the United States, as you know, Wolf, is an institution steeped in history and tradition. For a woman to break through what I call the marble ceiling here is something quite remarkable. It sends a message that women can do anything.

BLITZER: And do you feel a special responsibility knowing that, historically, this has never happened in our country before, that a woman becomes the speaker of the House?

PELOSI: I do. I feel a very special responsibility. I feel a responsibility to have the most honest and open Congress, to have a Congress that has civility as its hallmark, bipartisanship in our debate and our deliberations, and fiscal soundness as a woman would want to have, not heaping mountains of debt on future generations.

And as the first woman speaker, I would want to conduct myself, perform my duties, in a way that would be sure that it wouldn't be too long before we'd have another woman speaker of the House.

BLITZER: It puts a little added pressure on you, but we'll get back to that.

Let's talk about the news of the day. Lots of news, but we'll start with Donald Rumsfeld. A bombshell announcement. Only a few days ago, the president said he was doing a fantastic job, together with the Vice President Dick Cheney. Is this what you wanted, Rumsfeld to step down?

PELOSI: Yes, well, there were two major interventions since the president's last reaffirmation of his support for Secretary Rumsfeld. One was, of course, the vote and the voice of the American people yesterday, rejecting the stay the course policy of the president in Iraq.

And just before that, the voice of the military in the Army, Navy, Air Force and Marine Corps Times, saying that "Rumsfeld must go," to use their words. The president got the message, thank heavens, and I think it signals a new change, I hope, for the better in Iraq.

BLITZER: What do you think of his designated successor, the former CIA director, Robert Gates? PELOSI: Well, this is a matter for the Senate to deliberate on, and the president has proposed, they will confirm, and I very much look forward to the hearings on that nomination.

BLITZER: But fundamentally, do you think there will be a real change in U.S. policy toward Iraq, or this is simply changing the cast of characters? Will the president, in other words, do what you want him to do?

PELOSI: Well, first of all, the president is the commander in chief. Donald Rumsfeld and whoever the president appoints are -- gets confirmed -- Mr. Gates, in this case -- is an employee of the president. So the policy is the president's. The implementation of the policy is Mr. Rumsfeld's, and that's why I think it was very important for him to go.

BLITZER: If the president pursues the current policy, as you call it, stay the course, which he no longer uses that phrase, one option would be, in the House of Representatives, the power of the purse, to cut funding for the war in Iraq. Is that on the table?

PELOSI: Not really. We would never...

(CROSSTALK)

BLITZER: Why isn't it on the table?

PELOSI: Well, because our troops are in harm's way. They have been sent there, whether you agree with the policy or not, and I certainly did not agree with the resolution to go to war. We would not withhold our funding for the troops there.

BLITZER: So what can the House of Representatives do, as you -- with you as speaker, if the president, over the next two years, continues the strategy, the policy as is?

PELOSI: Well, what we have done in the House and Senate now, with a majority -- a Democratic majority in the Senate, I anticipate, Senator Reid and I, the Democratic leader there, have put forth some principles for solving the problem in Iraq.

BLITZER: You can make recommendations, basically.

PELOSI: Yes.

BLITZER: But there's not much more if you're not going to use the power of the purse. There's not much more that you could do. You could do some oversight.

PELOSI: Well, the oversight will be very important because then the truth would be revealed. But remember that stay the course has with it -- whether it's the president changed the slogan, he hasn't changed the strategy or the approach. And on the -- stay the course also implies staying the course as having a one-party policy in Iraq. Even his own Republicans, in some cases, are deserting him on this. So I think in the interest of our national security and protecting the American people and bringing stability to the region, and to honoring our commitment to our troops, we need a different approach. And extending the hand of partnership to the president -- not partisanship, but partnership -- to say let's work together to come to some common ground where we can solve the problem in Iraq.

BLITZER: Can you work with this president?

PELOSI: Sure.

BLITZER: Because he was asked at the news conference earlier today about some things you've said of him. Our Suzanne Malveaux asked a very pointed question to the president, quoting some of the remarks, "a liar," and "misleading the country."

PELOSI: I never called the president a liar. I never called him that.

BLITZER: But do you have a problem working with this president? Is all that in the past now? Are you ready to start fresh in working as the incoming speaker?

PELOSI: Absolutely. You know, the campaign is over. Democrats are ready to lead, prepared to govern, and absolutely willing to work in a bipartisan way in partnership, not partisanship, with the Republicans in the Congress and with the president of the United States.

BLITZER: The vice president said the other day the president has made clear what his objective is. It's victory in Iraq and full speed ahead on that basis, and that's exactly what we're going to do. Do you consider that statement that was pre-election still operable?

PELOSI: I would say to the vice president that it's a little too late for full speed ahead. We've been in Iraq three-and-a-half years, longer than the U.S. was in Europe during World War II, so full speed ahead, I don't think so. Right now, again, we need a new direction that brings stability to the region and makes the American people safer.

BLITZER: The power that you will have as the majority is subpoena power, when you conduct your investigations, your oversight. You said on "Meet the Press" back on May 7th, "Well, we will have subpoena power. Investigation does not equate to impeachment. Investigation is the requirement of Congress. It's about checks and balances."

Tell us how you plan on pursuing using this subpoena power.

PELOSI: Well, first of all, others have said to us, do the Democrats want to get even now that we're in the majority? We're not about wanting to get even. What we want to do is to help the American people get ahead, not to get even with the Republicans.

And so, as we go forward with our hearing process and -- which is the normal checks and balance responsibility of Congress, it will be to what is in furtherance of passing legislation that makes the policy better, that improves the lives of the American people. In order to make important decisions, you have to base them on facts. That's the only way your judgment...

(CROSSTALK)

BLITZER: So you'll use that subpoena power as appropriate?

PELOSI: Well, it's not a question -- well, subpoena power is a last resort. We would hope that there would be cooperation from the executive branch in terms of investigating the pre-war intelligence. I don't know -- those decisions will be made by our caucus with the wisdom of the committees of jurisdiction.

They may or may not be a priority. We're a brand-new caucus, we have many new, excellent members coming in and we will establish our priorities together. But we will not abdicate our responsibility as the first branch of government, Article I, the legislative branch and our checks and balances responsibilities.

BLITZER: I asked the question about subpoena power because the vice president once again made clear if you subpoena him, he's not necessarily going to play ball. "I have no idea that I'm going to be subpoenaed," he said the other day, "and obviously we'd sit down and look at it at the time, but probably not in the sense that the president and vice president are constitutional officers and don't appear before the Congress."

PELOSI: Well, as you know, President Ford did and he wasn't subpoenaed because he came without a subpoena, but why are we even talking about this? We're so far from that. We're at a place where we're here about the future.

Whatever information we need to make the future better, to go forward, whether it's to protect our country, to end our engagement in Iraq, to make our economy fair, whatever it is -- we need to move towards energy independence, I might add -- that's where our priorities are. Information is central to that. So we would have hearings to obtain information.

BLITZER: As we speak right now, the majority in the House will be the Democrats. Right now, it looks like the Democrats have an excellent chance in the Senate as well, assuming that Virginia goes to Jim Webb. It's still unclear, but if it does, the Democrats will be the majority in the Senate.

Here's what you said on "60 Minutes," back in October: "This election is about them. This is a referendum on them. Making them lame-ducks is good enough for me."

PELOSI: Well, that was an answer to their question about impeachment. I said impeachment is off the table, that making the president a lame-duck, that is to say not a president with total power where there is no Congressional questioning, oversight or hearings about his policy when there should be. So, we will now. We will work together. The campaign, as I said, is over. We're ready to lead, prepared to govern, and look forward to working with them.

BLITZER: We're almost out of time, but a couple of housekeeping questions -- the majority leader in the new Congress. We know Steny Hoyer wants it, John Murtha, an outspoken critic of the war in Iraq, wants it. Who do you want to be the majority leader in the House?

PELOSI: I'm not -- I haven't finished counting the votes from last night. We don't even know how many Democrats we have. We know it's in the mid-to-high 20s. When we know who we are as a caucus, we can move forward with those races, but right now, right now we're not at a place where I would even talk about such things.

BLITZER: So you're not ready to endorse or support anyone at this point?

PELOSI: I don't even know completely who's running. All kinds of ambition emerges after you win a majority, as I am learning, and so when we see all of that we'll go forward. But I will say though, both of them have served our party very well.

Steny Hoyer I've known since we were interns in Senator Brewster's office here. I'm from Maryland, as you know. And then Jack Murtha performed a great service to the country in blowing the whistle on this war about a year ago.

BLITZER: And, finally, can we assume that the ranking members -- now the minority members -- of the various committees will automatically step up and become the chairmen of those committees?

PELOSI: Well, again, that will be a decision of the House Democratic Caucus. Merit, seniority, diversity, and the support of the caucus are some of the criteria that are spelled out in our own rules. Most of them, I think, will go forward, but I can't speak for the entire caucus.

BLITZER: What about the Intelligence Committee?

PELOSI: What about it?

BLITZER: Do you think Jane Harman would be the appropriate chair, Alcee Hastings would be the appropriate chairman?

PELOSI: What you have to understand about the Intelligence Committee is the speaker of the House and the minority leader, on the first day of Congress, appoint a whole new Intelligence Committee each term. Sometimes they reappoint the same people. Sometimes they don't, but there is no seniority on the Intelligence Committee.

BLITZER: Let me just congratulate you and wish you the best of luck. This is going to be an exciting ride. We started off that you are going to be the first woman to be the speaker of the House. So you have an enormous amount of responsibility that comes with the job, a little bit extra because you're making history.

PELOSI: Well, I appreciate your saying that and I think one of my first acts as -- post-election, will be to become a grandmother for the sixth time. We're anxiously awaiting the birth of our grandchild, who is due the first week in November, so a good omen. We get ready for our new grandbaby as we get ready for a new Congress.

BLITZER: Well, we'll wish you only the best on that front as well.

PELOSI: As well, thank you. Thank you, Wolf.

BLITZER: Thank you.

(END VIDEOTAPE)

BLITZER: And up next, the Virginia Senate race. The Senate's balance of power spins on the close contest. Our senior legal analyst Jeffrey Toobin, will take us there and walk us through what's going on.

Also, our senior political correspondent Candy Crowley will join us to prime the pump for 2008. All that coming up in our 7:00 p.m. eastern hour. Stay with us.

(COMMERCIAL BREAK)

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

LOU DOBBS, CNN ANCHOR: Wolf, thank you very much. Coming up at 6:00 p.m. eastern here on CNN, we'll have the very latest on the resignation of Defense Secretary Donald Rumsfeld, we'll also be reporting on the likelihood of a recount in the Senate race in Virginia, a race that will determine who controls the U.S. Senate.

And Americans sending a powerful message to elected officials as the war on the middle class is escalating, voters demanding an increase in the minimum wage, new measures to protect private property rights. And will the Democrats' election victory make it easier for the president to push his amnesty agenda for illegal aliens through Congress? We'll have that special report and a great deal more at the top of the hour here on CNN. Please join us. Back to you, Wolf.

BLITZER: Lou, before I let you go, what do you make of this notion that there's probably going to be a recount in Virginia, about 7,000 votes separating George Allen and Jim Webb right now? Is this a good idea for Senator Allen to be asking for such a recount?

DOBBS: Well, it's, I think, in human nature terms and political terms, it is -- it's understandable. At the same time, we are being told by everyone from common cause to e-voting machine experts that it's going to be a very difficult recount, and could be tantamount to another Florida 2000 in Virginia this time.

So you know, personally, Wolf I would urge Senator Allen and I would say this, if the roles were reversed between he and James Webb, I think the gracious and caring thing for this country would be to exceed to the will of the people and forgo the recount. As difficult as that may be for him, this is a time in our country's history Wolf, I truly believe it, it's a time for graciousness, it's a time for class and forbearance of self-interest.

BLITZER: Because the Republicans will argue it's not just Senator Allen's seat that's at stake. It's the Republican majority in the United States Senate.

DOBBS: I think there's something else at stake. I'm animating here Wolf, and that is, it's for the good of the country, and it would be nice to see George Allen set a solid foundation for the future, for his future, for the Republican Party's future and for the good of the country and to forgo that recount.

BLITZER: Lou is going to be coming up right at the top of the hour and he's going to be staying with us throughout our 7:00 p.m. hour as well. Lou working a little bit harder but he's a young guy he can certainly do that. Lou, thanks very much.

DOBBS: Partner, it was great being with you throughout the election day and night, and morning. You're the best!

BLITZER: Well, thank you very much, Lou. We'll see you at the top of the hour. See you at 7:00 p.m. eastern as well. Lou Dobbs, coming up.

Let's check in with Zain for a quick check of some other stories making news. Zain?

ZAIN VERJEE, CNN ANCHOR: Wolf for the first time in six years the Supreme Court has heard oral arguments in a landmark abortion case. Justices today heard lawyers for the Bush administration and abortion rights group debate the constitutionality of a federal law banning certain late-term abortions. It's unclear how the court will rule, when. At one point an anti-abortion protester was removed from the court chambers when he tried to disrupt proceedings.

Life in prison for six murders in Maryland. That's the sentence delivered today to convicted sniper Lee Boyd Malvo, now 21. Malvo was one of two men found guilty of a three-week shooting sniper spree that terrorized suburban Washington, D.C. In all, 13 people were shot in the 2002 rampage. Malvo pleaded guilty last month to carrying out the spree with companion John Allen Muhammad, who's already been convicted.

Israeli leaders have expressed regret of the deaths of civilians during an attack on Gaza today. Eighteen people including eight children were killed in the Israeli artillery barrage on a densely populated neighborhood. They were members of a prominent Palestinian extended family. The angry exiled leader of Hamas called off a cease- fire. Militants called for attacks on Americans. Hamas leaders in Gaza quickly distanced themselves from those calls -- Wolf.

BLITZER: Thanks very much Zain for that.

Up ahead, what really happened yesterday? The former House majority leader Tom DeLay says, and I'm quoting now "The Democrats didn't win, the Republicans lost." Jack Cafferty asks, is he right? We're taking your e-mail. And next, he's been their for boss six years. How are the armed forces taking news that Donald Rumsfeld is resigning? We'll check with the military blog. Stay with us. You're in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: Check in with Jack Cafferty, he's got "The Cafferty File." Jack?

CAFFERTY: Wolf, the former House majority leader Tom DeLay crawled out of the woodwork this morning and made the following pronouncement, "The Democrats didn't win, the Republicans lost." Do you think he's right in that assessment is the question we asked.

Jonathan in Glen Falls, New York wrote, "Jack, this guy isn't even in the mix anymore. Isn't he one of the main reasons that the GOP got slaughtered last night? Why is anyone giving this scandalous weasel any airtime at all?"

Deb writes from Wimberley, Texas, "The Republicans lost because of those just like Tom DeLay. The Democrats won because Americans are desperate for change and want some sort of hope for our future. Middle America and many others in this crazy world have lost a lot because of the neocons fascist views of all of us. Tom DeLay and his gerrymandering and his outright pandering to special interests have harmed many lower income Texans, like my family. I hope Mr. DeLay crawls back into the swamp he crawled out of so I never have to look upon his lizard face again."

Jennifer in Pontotoc, Mississippi, "Tom DeLay is right. It is certainly a great loss for us and it will make it harder for the president to get Congress to pass vital bills. Even though I'm a woman I believe that men should be the leaders and I dislike the idea of a madam moderator in the House."

Sue in Clarksville, Georgia, "The Republicans didn't win, neither did the Democrats. America won. It's time to realize our political parties need to work together for the welfare of America and not for the individual parties. That's the message American sent to Congress last night."

And Chris in Warden, Illinois writes, "Jack, when the Cardinals won the World Series, you didn't hear the Tigers saying, oh, the Cards won just because we lost. That is just stupid."

If you didn't see your e-mail here, you can go to CNN.com/CaffertyFile and read some more of these online -- Wolf.

BLITZER: All right, Jack, thank you.

So what are members of the United States military saying about Donald Rumsfeld's resignation? Our internet team is standing by to show us. Stay with us.

(COMMERCIAL BREAK) BLITZER: So how are members of the United States military reacting to Donald Rumsfeld's resignation? Our internet reporter Jackie Schechner is monitoring the situation online. Jackie what are you seeing?

JACKIE SCHECHNER, CNN INTERNET REPORTER: Wolf, we're starting to see reaction just coming in. We've got some from the front lines in Afghanistan, from a sailor who's actually helping out with the U.S. Army on the ground. Wondering about the overall change in leadership, not just Rumsfeld leaving but the Democrats coming in and wondering if this means now the development of an exit strategy. Really just curiosity and wonderment at this point.

It's a little early to get reaction coming out of Iraqi blogs on the front lines. Our servicemen on the front lines just because the news broke so late in the day for them. But we are getting plenty of military bloggers here in the United States that are reacting. This is a soldier who served in Ramadi, he was a sniper and he's now recovering from some wounds in New England, but he says this is a double edged sword for him. That for somebody who supports the war, that it's tough to see the architect of the war depart.

Now, we've also got James Hamsen who goes by Uncle Jimbo, he blogs at blackfive.net, he's retired special ops. He's actually very angry at President Bush, he says why not make this Rumsfeld announcement before the election instead he managed to alienate some moderate Democrats and Republicans who would otherwise be supportive of the war on terror and he's very, very angry at the president for waiting on that one.

And we've also got Patriot, who's an anonymous U.S. Army, he's 34 years old blogging at a soldier's perspective, talking about Robert Gates coming in, how it's actually going to be good to have somebody with military experience stepping in and somebody with the intelligence experience of the CIA. But they're saying if it wasn't somebody who was military, Wolf, that Rumsfeld was a good one.

BLITZER: Jackie, thank you very much.

And we'll be back in one hour. Much more of our coverage coming up. In the meantime let's go to Lou in New York -- Lou.

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