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THE SITUATION ROOM

Interview with Dick Cheney; John Kerry Will Not Run in '08; Controversy Over Bush's Iraq Plan

Aired January 24, 2007 - 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: 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, Vice President Dick Cheney makes no excuses and pulls no punches on Iraq or anything else. On this day after the president's State of the Union Address, I asked Cheney some of the tough questions you want answered in an exclusive interview. You won't want to miss what he had to say on a wide range of topics, from Osama bin Laden to John McCain and Hillary Clinton.

Also this hour, big guns open fire -- top senators of both parties tear into the president's plan for a troop build-up, even as Mr. Bush struggles to sell his policy to the American people.

Plus, Democrat John Kerry makes his decision.

Is the 2004 presidential nominee in or out in 2008?

The senator's announcement. That's coming up ahead.

I'm Wolf Blitzer.

You're in THE SITUATION ROOM.

This hour the Bush-Cheney administration and the United States Senate on a collision course over Iraq. I sat down with the vice president on this day after the president's State of the Union Address.

In our exclusive and often spirited interview, Cheney quickly made it clear he isn't giving any ground to critics of a troop build- up.

(BEGIN VIDEO CLIP)

BLITZER: What if the Senate passes a resolution saying this is not a good idea? Will that stop you?

DICK CHENEY, VICE PRESIDENT OF THE UNITED STATES: It won't stop us. And it would be, I think, detrimental from the standpoint of the troops.

(END VIDEO CLIP) BLITZER: I spoke with the vice president for more than 20 minutes, pressing him on everything from Iraq to his own credibility to his Republican critics. You're going to hear all of this provocative conversation over the course of the next two hours.

Meanwhile, the Senate Foreign Relations Committee sent a message today to the president and the vice president. The panel voted 12-9 to approve a non-binding resolution against the troop build-up in Iraq. Just one Republican sided with the Democratic majority. That would be Senator Chuck Hagel of Nebraska.

He angrily urged his colleges to take a stand and stop playing politics.

(BEGIN VIDEO CLIP)

SEN. CHUCK HAGEL (R), NEBRASKA: But I would caution again, stop the impugning of people's motives, stop the political stuff, all of us. All of us.

(END VIDEO CLIP)

BLITZER: We're going to have more on Senator Hagel's controversial remarks, the committee vote. All that coming up.

Right now, though, we want to turn to a major new development in the early presidential race. Senator John Kerry, the Democrats' nominee in 2004, has just announced his plans for 2008. He's not running again.

Let's turn to our chief national correspondent, John King, for some of the latest details.

It was a surprise. We had assumed he was going to make an announcement soon. I think a lot of us were surprised to hear the word would be no today.

JOHN KING, CHIEF NATIONAL CORRESPONDENT: Well, Wolf, as recently as the Christmas holidays, Senator Kerry, the junior senator from Massachusetts, and, as you noted, the Democrats' nominee back in 2004, was telling friends and associates he had every intention of jumping into the 2008 race.

But today we learned from him directly on the Senate floor, the man who came within about 120,000 votes of being the president back in 2004, of winning the election and assuming the presidency in 2005, went to the Senate floor after a lengthy speech in which he denounced the president's Iraq plan, said it was critical that the United States Senate do everything it can to get the troops home.

Kerry said he wanted to end on a personal note and a political note. He said he was proud of the campaign he ran back in 2004, but that he will not be a candidate in 2008.

(BEGIN VIDEO CLIP) SEN. JOHN KERRY (D), MASSACHUSETTS: We came close, Mr. President, certainly close enough to be tempted to try again. There are powerful reasons to want to continue that fight now. But I've concluded this isn't the time for me to mount a presidential campaign. It is the time to put my energy to work as part of the majority in the Senate, to do all I can to end this war and strengthen our security and our ability to fight the real war on terror.

(END VIDEO CLIP)

KING: Senator Kerry reiterated that message in an e-mail he sent to supporters across the country just after finishing the speech in the Senate. He said he wanted to fight the president's war in the Senate. He also said he wanted to seek reelection in Massachusetts in 2008.

But, Wolf, we've checked in with Democratic activists, some who worked very closely with Senator Kerry in the last campaign. And they also said, over the past few weeks, he's simply also come to grips with the cold reality -- with Senator Hillary Clinton in the race; Senator Barack Obama in the race, John Edwards, who was his running mate back in 2004, already in the race; as well as six other Democrats saying they will run or are inclined to run; Senator Kerry was being told by people around the country, many of his past supporters would not be with him; that raising money would be more difficult.

In our own CNN/Opinion Research Corporation polling, 51 percent of Democrats said they do not want him to run again and he was way behind Mrs. Clinton and the others in the polls.

So, a cold political reality check, Wolf, resulting in the dramatic announcement he made just a short time ago on the Senate floor.

BLITZER: Does it help anyone in particular, like Mrs. -- like Senator Clinton or Senator Obama or somebody else, John Edwards, the fact that Kerry is out?

Who among the Democrats wins by this?

KING: Oh, some would make the argument that those who had the closest affinity to the Kerry-Edwards campaign, who might have been waiting on Senator Kerry, might -- their first choice might be to go back to Senator Edwards, if you will, to keep it in the family.

But essentially what you do have is somebody who proved he could raise some money back in 2004 out of the race. And there's a fierce competition for money, especially now that Mrs. Clinton says she won't accept the public financing.

Nobody thinks that there was a huge Kerry constituency out there that will go to just one candidate. But it certainly reinforces, more than anything, how the early Democratic senator by Senator Obama, Senator Edwards, and now, Mrs. Clinton, most recently, are accelerating the pace of this campaign. The fundraising challenge is daunting. The organizing challenge is daunting. And Senator Kerry, in the end, again, we are told that even his colleague from Massachusetts, Senator Ted Kennedy, told him if you run I'll be with you, but it would be a very, very difficult challenge out there.

BLITZER: First the former Virginia governor, Mark Warner; then Evan Bayh of Indiana; now John Kerry, all deciding not to run.

John, thanks for that.

KING: OK.

BLITZER: Let's turn back to Iraq and the heated debate and the vote in the United States Senate Foreign Relations Committee today.

Let's turn to our Congressional correspondent, Dana Bash -- Dana.

DANA BASH, CNN CORRESPONDENT: Well, Wolf, by a vote of 12-9, that Senate committee voted to repudiate the president on the war. It is a non-binding or symbolic resolution. But the supporters of that resolution say they hope it will get the president's attention.

(BEGIN VIDEO TAPE)

BASH (voice-over): Twelve hours after the president asked Congress to give his new Iraq plan time to work, he got his answer.

The Senate Foreign Relations Committee began debate on a resolution opposing more troops in Iraq.

SEN. JOSEPH BIDEN (D-DW), FOREIGN RELATIONS COMMITTEE: And what it is, it's an attempt to save the president from making a significantly -- a significant mistake we regard to our policy in Iraq.

BASH: The non-binding resolution says a troop increase is not in the national interests of the United States.

HAGEL: We'd better be as sure as you can be -- and I want every one of you, every one of us, 100 percent of us, to look in that camera. And you tell your people back home what you think.

BASH: The sole Republican who voted for the resolution challenged the entire Senate to engage in what he called an overdue debate about a mangled war.

HAGEL: Why are you elected? Because you wanted a safe job?

Go sell shoes.

BASH: Although nine out of 10 GOP senators voted against the measure, almost none said they support the president.

SEN. RICHARD LUGAR (R), INDIANA: I am not confident that President Bush's plan will succeed. BASH: The committee's top Republican said he was voting against the resolution because it would send the wrong signal to U.S. troops and he said the White House wouldn't listen anyway.

LUGAR: This vote will force nothing on the president. But it will confirm to our friends and allies that we are divided and in disarray.

BASH: Four Republicans on the committee said they agree with Democrats that sending more troops to Iraq is a mistake, but said they're looking for what they consider less controversial language to support.

SEN. LISA MURKOWSKI (R), ALASKA: I happen to disagree with the president on the search. I don't believe that that is the most effective way for us to move forward at this point in time.

Do I feel disloyal in saying that?

No.

(END VIDEO TAPE)

BASH: Now, there were a couple of Republicans who came out in support of the president's plan to send more troops to Iraq, saying that they simply don't see other options right now. And on the Democratic side, Senator Chris Dodd, another presidential candidate on that committee, tried to get something through the committee that he has been pushing, saying that there should be a cap on troop levels. That would be, from his perspective, an actual binding piece of legislation. He said that this kind of symbolic resolution -- it's just words and that it's time for Congress to do something.

Democratic leaders, Wolf, say that they promise to address that, but not until after the debate on the non-binding resolution. They expect that to be on the Senate floor as early as next week -- Wolf.

BLITZER: Lots of activity going on in the Senate. And Dana will watch it every step of the way.

In Iraq earlier today, fierce fighting along one of the deadliest stretches of Baghdad. U.S. and Iraqi troops battled militants as part of targeted raids aimed at trying to restore security in the infamous and volatile Haifa Street.

An Iraqi official says at least 30 insurgents were killed, 35 others were detained. U.S. and Iraqi forces now are said to be in control of the situation.

In another part of Baghdad, one U.S. soldier was killed by small arms fire. That brings the total number of military deaths for the United States since the war began up to 3,062.

President Bush is getting feedback today on his State of the Union Address. If he had hoped to make major inroads with the American public on Iraq, he's likely disappointed. Our overnight poll, conducted by Opinion Research Corporation, shows nearly half of the Americans who watched the speech, 46 percent, say they are not confident the U.S. will achieve its goals in Iraq.

Today, Mr. Bush is focusing in on one of his main domestic policy proposals in his speech last night, a plan to try to help America kick its addiction to oil.

Let's bring in our White House correspondent, Ed Henry -- Ed.

ED HENRY, CNN CONGRESSIONAL CORRESPONDENT: Wolf, if you want to get an idea of how the president's wings have been clipped a bit, two years ago, after his State of the Union Address, he raced out on a two day, five state tour to promote his signature Social Security reform plan. As you know, that didn't go anywhere.

Today, the president went pretty close by, not too far away -- Delaware, a quick stop, to promote his signature domestic plan in last night's speech, this energy plan, the 2010 Plan. As you know, he wants to cut gasoline consumption by 20 percent over the next 10 years. He wants to cut foreign dependence -- dependence on foreign oil by pushing these alternative fuels like ethanol.

The president today visiting this DuPont company facility that conducts research on biofuels. The president also issued an executive order for the federal government to find ways to save resources, conserve energy from its large fleet of vehicles, an effort to have the government set a good example.

Here's the president.

(BEGIN VIDEO CLIP)

GEORGE BUSH, PRESIDENT OF THE UNITED STATES: We're going to purchase more flex -- hybrid and flexible fuel vehicles that run on ethanol. We own a lot of cars and therefore it's one thing to say this is the goal, it's another thing to actually participate in achieving that goal, and that's what we're going to do.

Secondly, we're going to purchase plug-in hybrid vehicles as soon as they hit the market.

(END VIDEO CLIP)

HENRY: Now, it's important to note that unlike the president's health care initiative last night, Democratic leaders Harry Reid and Nancy Pelosi are not dismissing this energy plan out of hand. They're not happy with the entire thing, but they both say this is a good starting point. They want to reduce the dependence on foreign oil.

Also, though, Iraq, as you noted, very much on the president's mind. In the next hour, he's going to be here at the White House, meeting with the joint chiefs, as well as combatant commanders. After that, they're going to have their annual dinner together. They'll obviously talk about the war on terror and the White House is reacting to this Senate action today by saying what the president said last night, which is he wants Congress to give his plan a chance to work -- Wolf.

BLITZER: All right, we'll cover that event in the next hour, as well, when the president meets with the joint chiefs.

Ed, thanks very much.

Ed Henry, Dana Bash, John King, they are all part of the best political team on television.

And remember, for the latest political news at any time, check out our Political Ticker. Cnn.com/ticker is the place to go.

Let's go to Jack Cafferty right now.

He's in New York with The Cafferty File -- hi, Jack.

JACK CAFFERTY, CNN CORRESPONDENT: How are you doing, Wolf?

It must be contagious. The Iraqi parliament has an attendance problem. The "New York Times" reports nearly every session since November has been adjourned because as few as 65 of the 275 members show up.

And when they don't show up, well, guess what?

They still get paid. They collect their salaries and their benefits, totaling about $120,000 a year. It sounds like they've been taking lessons from the U.S. Congress.

Security, of course, one reason they're not going to work. But officials also say that members could be losing confidence in the Iraqi government. With violence on the rise, it looks increasingly to the lawmakers like their jobs are becoming more irrelevant.

And then perhaps the job just isn't what they thought it would be. One Shiite member told the "New York Times," quoting here: "Most of them were here for the game, for prestige, for the money."

The speaker of the parliament says they're going to start fining members $400 for every session they miss and replace those who aren't showing up if they don't meet a minimum requirement.

Maybe we ought to try that here.

Here's the question -- how can there be progress in Iraq when most members of parliament don't show up for work?

E-mail your thoughts to caffertyfile@cnn.com or go to cnn.com/caffertyfile -- Wolf.

BLITZER: That's a serious problem, indeed, Jack.

Thank you for that.

Coming up...

(BEGIN VIDEO CLIP)

BLITZER: The criticism is that you took your eye off the ball by going into Iraq and, in effect, reducing the focus of attention on al Qaeda and bin Laden.

CHENEY: That's just not true. I've heard that charge. It's simply not true, Wolf.

(END VIDEO TAPE)

BLITZER: Coming up next, my one-on-one interview with the vice president, Dick Cheney. You're going to want to see this exclusive and tough interview.

Also ahead, President Bush talks about a new kind of war in Iraq. We'll take a closer look at his new strategy and how it's changed over the years.

Stick around. You're in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: The vice president, Dick Cheney, sat behind President Bush during his State of the Union Address and listened to the commander-in-chief strike a more humble tone on Iraq.

But today, the vice president isn't budging an inch on the war or on a troop build-up.

I asked Mr. Cheney some tough questions about several subjects in an exclusive and often heated interview.

What got the vice president riled up?

Listen for yourself.

(BEGIN VIDEO TAPE)

BLITZER: And joining us now, the vice president of the United States, Dick Cheney.

Mr. Vice President, thanks very much for doing this.

CHENEY: Well, it's good to see you again, Wolf.

BLITZER: We heard the president mention Osama bin Laden last night in his State of the Union address.

Why can't you find this guy?

CHENEY: Well, he's -- obviously, he's well hidden. We've been looking for him for some time. I think the fact is, that he's gone totally to ground. He doesn't communicate, except perhaps by courier. He's not up on the air. He's not putting out videos, the way he did oftentimes in the past.

BLITZER: His number two, Ayman al-Zawahiri, is.

CHENEY: Zawahiri's much, much more visible, yes.

BLITZER: I mean he's on television almost as much as I am.

CHENEY: Well, I don't know if anybody is on as much as you are, Wolf, but -- no, he's more -- more of a public figure than Osama is.

But they're, you know, if you've ever been in that part of the world, it is some of the most rugged territory imaginable. I've flown over it and been on the ground in Afghanistan, Pakistan, up along the Khyber Pass and so forth. And that general area is -- is a remarkably difficult area to get people into.

BLITZER: Is bin Laden still...

CHENEY: Parts of it have never really been controlled by any...

BLITZER: Is bin Laden still alive?

CHENEY: I think so.

BLITZER: And you think he's in Pakistan, Afghanistan, on the border some place?

CHENEY: I don't want to be that precise.

BLITZER: Because this is so frustrating to so many people, more than five years after 9/11, not only that bin Laden is out there, but that his deputy pops up every now and then on television and makes these threats.

CHENEY: Yes, but look what we have done. We have not gotten Osama bin Laden, obviously, because he's very careful. I mean, say he doesn't communicate and he's not sort of in direct contact on a regular basis.

But we've taken out, several times, that whole layer of leadership underneath Osama bin Laden and Zawahiri. One of the most dangerous jobs in the world is to be number three in the al Qaeda organization because a lot of them are now dead or in custody.

So we've done a lot of damage to that senior leadership...

BLITZER: Here's a criticism...

CHENEY: ... including Khalid Sheik Mohammad and many others, as well, too.

BLITZER: The criticism is that took your eye off the ball by going into Iraq and, in effect, reducing the focus of attention on al Qaeda and bin Laden.

CHENEY: It's just not true. I've heard that charge. It's simply not true, Wolf. The fact of the matter is we can do more than one thing at a time. And we have. And we've been very successful with going after al Qaeda. They're still out there. They're still a formidable force. But they're not nearly as formidable as they once were, in terms of numbers and so forth.

We have...

BLITZER: There's some experts who think they're...

CHENEY: We have...

BLITZER: ... even a greater threat today.

CHENEY: We have successfully defended the country for over five years against any further attacks. They've tried, we know, repeatedly. The president talked about it last night in his speech. We know they tried last summer to capture airliners coming out of the U.K. and to blow them up over the United States or over the Atlantic. There have been numerous attacks have been disrupted.

It's been a remarkable performance by the U.S. military and by our intelligence service and everything else.

If you had asked, shortly after 9/11, what the odds were that we could go better than five years without another attack on the homeland, I don't think anybody would have been willing to take that bet.

The fact is we've been enormously successful in that regard. We still, obviously, want to get Osama bin Laden and Zawahiri. But we've had great success against al Qaeda.

BLITZER: Here is what the president said last night.

(BEGIN VIDEO CLIP)

BUSH: We can expect an epic battle between Shia extremists backed by Iran and Sunni extremists aided by al Qaeda and supporters of the old regime. The contagion of violence would spill out across the country and, in time, the entire region could be drawn into the conflict. For America, this is a nightmare scenario.

(END VIDEO CLIP)

BLITZER: He was talking about the consequences of failure in Iraq.

CHENEY: Right.

BLITZER: How much responsibility do you have, though -- do you and the administration -- for this potential scenario?

CHENEY: Well, you know, this is the argument that there wouldn't be any problem if we hadn't gone into Iraq.

Now...

BLITZER: Well, Saddam Hussein would still be in power. CHENEY: Saddam Hussein would still be in power. He would, at this point, be engaged in a nuclear arms race with Ahmadinejad, his blood enemy next door in Iran.

BLITZER: But he was being contained...

CHENEY: He was...

BLITZER: ... as you well know...

CHENEY: He was not being contained...

BLITZER: ... by the no-fly zones in the north...

CHENEY: He was not being contained.

BLITZER: ... and in the south.

CHENEY: Wolf, the entire sanctions regime had been undermined by Saddam Hussein. He had...

BLITZER: But he didn't have stockpiles of weapons of...

CHENEY: He had corrupted the entire effort to try to keep him contained. He was bribing senior officials of other governments. The Oil For Food Program had been totally undermined. And he had, in fact, produced and used weapons of mass destruction previously, and he retained the capability to produce that kind of stuff in the future.

You can go back...

BLITZER: But that was in the '80s.

CHENEY: You can go back and argue the whole thing all over again, Wolf. But what we did in Iraq in taking down Saddam Hussein was exactly the right thing to do. The world is much safer today because of it. There have been three national elections in Iraq. There's a democracy established there, a constitution, a new democratically elected government. Saddam has been brought to justice and executed. His sons are dead. His government is gone. And the world is better off for it.

You can argue about that all you want. That's history.

BLITZER: Right. Well...

CHENEY: That's what we did, and you and I can have this debate. We've had it before. But the fact of the matter is, in terms of threats to the United States from al Qaeda, for example, attacks on the United States, they didn't need an excuse. We weren't in Iraq when they hit us on 9/11. They -- the fact of the matter was --

BLITZER: But the current situation there is...

CHENEY: The fact of the matter was that al Qaeda was out to kill Americans before we ever went into Iraq. BLITZER: The current situation there is very unstable.

CHENEY: It is.

BLITZER: The president himself speaks about a nightmare scenario right now. He was contained, as you repeatedly said throughout the '90s, after the first Gulf War, in a box, Saddam Hussein.

CHENEY: He was -- after the first Gulf War, had managed -- he kicked out all the inspectors. He was providing payments to the families of suicide bombers. He was a safe haven for terrorism, one of the prime state sponsors of terrorism, designated by our State Department for a long time. He'd started two wars. He had violated 16 U.N. Security Council resolutions.

If he were still there today, we'd have a terrible situation.

Today, instead...

BLITZER: But there is a terrible situation there.

CHENEY: No, there is not. There is not. There's problems -- ongoing problems -- but we have, in fact, accomplished our objectives of getting rid of the old regime...

BLITZER: And...

CHENEY: ... and there is a new regime in place that's been there for less than a year, far too soon for you guys to write them off. They have got a democratically written constitution, the first ever in that part of the world. They've had three national elections. So there's been a lot of success.

We still...

BLITZER: How worried are you, Mr. Vice President...

CHENEY: We still have more work to do to get a handle on the security situation...

BLITZER: How worried...

CHENEY: But the president has put a plan in place to do that.

BLITZER: How worried are you of this nightmare scenario -- that the U.S. is building up this Shiite-dominated Iraqi government with an enormous amount of military equipment, sophisticated training, and then, in the end, they're going to turn against the United States?

CHENEY: Wolf, that's not going to happen. The problem is you've got...

BLITZER: They're very -- very -- warming up to Iran...

CHENEY: Wolf...

BLITZER: ... and Syria right now.

CHENEY: Wolf, you can -- you can come up with all kinds of what- ifs. You've got to be deal with the reality on the ground. The reality on the ground is we've made major progress. We've still got a lot of work to do. We've got a lot of provinces in Iraq that are relatively quiet. There's more and more authority transferred to the Iraqis all the time.

But the biggest problem we face right now is the danger than the United States will validate the terrorists' strategy, that, in fact, what will happen here, with all of the debate over whether or not we ought to stay in Iraq, with the pressures from some quarters to get out of Iraq, if we were to do that, we would simply validate the terrorists' strategy that says the Americans will not stay to complete the task...

BLITZER: Here's the...

CHENEY: ... and that they don't...

BLITZER: ... Nouri Al-Maliki...

CHENEY: That we don't have the stomach for the fight.

BLITZER: Here's the problem we have...

CHENEY: That's the biggest threat right now.

BLITZER: Here's the problem that I see -- and tell me if I'm wrong -- that he seems to be more interested right now, the prime minister of Iraq, in establishing good relations with Iran and Syria than he is with moderate Arab governments, whether in Jordan or Egypt or Saudi Arabia.

CHENEY: I just think you're wrong, Wolf. He's been working with all of them. They're all in the neighborhood. He's got to develop relationships with all of them, and he has.

BLITZER: Because he's a Shia and these moderate Arab governments are Sunni.

CHENEY: He's also -- he's also an Iraqi. He's not a Persian. There's a big difference between the Persians and the Arabs, although they're both Shia. You can't just make the simple statement that he's Shia, therefore he's the enemy.

The majority of the population in Iraq is Shia. And for the first time we've had elections and majority rule will prevail there.

But the notion that somehow the effort hasn't been worth it or that we shouldn't go ahead and complete the task is just dead wrong.

(END VIDEO TAPE)

BLITZER: Coming up, what does the vice president think about his fellow Republicans, some of whom are now abandoning the White House over the war in Iraq?

We're going to have much more of this exclusive interview with the vice president. That's coming up in a few moments right here in THE SITUATION ROOM.

Also, is President Bush changing his strategy on Iraq?

I'll ask our senior political analyst, Bill Schneider.

Stick around. You're in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: To our viewers, you're in THE SITUATION ROOM, where new pictures and information are arriving all the time. Happening now, Dick Cheney defending his credibility, calling the suggestion that Republicans think he blundered on Iraq, in his word, "hogwash."

The vice president takes on his critics, including me. More of our exclusive interview. That's coming up ahead.

President Bush is taking his taking his State of the Union message on the road. He went to Delaware to promote his plan to reduce gasoline consumption of greenhouse gasses. And he signed an executive order to cut back on the federal government's energy use.

Senator John Kerry decides to sit out the 2008 presidential race. The Democrat announced his decision today, saying he'll focus on trying to change the administration's Iraq policy as a senator.

Will Kerry's absence be felt?

We'll ask J.C. Watts and Paul Begala.

They're standing by live four our Strategy Session.

I'm Wolf Blitzer and you're in THE SITUATION ROOM.

President Bush's State of the Union address is another marker in his long and difficult struggle to try to convince the American public he was right in Iraq and has a good strategy to move forward.

Our senior political analyst, Bill Schneider, is joining us now to consider Iraq then and now -- Bill.

WILLIAM SCHNEIDER, CNN SENIOR POLITICAL ANALYST: Wolf, President Bush has what he calls a new strategy for Iraq. That's because it's a new war.

(BEGIN VIDEOTAPE)

SCHNEIDER (voice-over): Here's how President Bush made the case for war in Iraq in his 2003 State of the Union speech.

(BEGIN VIDEO CLIP, 2003) GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: Saddam Hussein has gone to elaborate lengths, spent enormous sums, taken great risks to build and keep weapons of mass destruction.

(END VIDEO CLIP)

SCHNEIDER: Those weapons were never found. So, President Bush made a different argument in his inaugural address two years later.

(BEGIN VIDEO CLIP, 2005)

BUSH: The survival of liberty in our land increasingly depends on the success of liberty in other lands.

(END VIDEO CLIP)

SCHNEIDER: This month, the president acknowledged that the mission in Iraq did not go according to plan.

BUSH: The violence in Iraq, particularly in Baghdad, overwhelmed the political gains the Iraqis had made.

SCHNEIDER: In this year's State of the Union speech, President Bush made this startling statement.

BUSH: This is not the fight we entered in Iraq, but it is the fight we are in.

SCHNEIDER: It's a different war, requiring a new argument.

BUSH: If American forces step back before Baghdad is secure, the Iraqi government would be overrun by extremists on all sides.

SCHNEIDER: The enemy is now chaos.

BUSH: And out of chaos in Iraq would emerge an emboldened enemy with new safe havens, new recruits, new resources, and an even greater determination to harm America.

SCHNEIDER: Which we helped create, critics say.

SEN. JAMES WEBB (D), VIRGINIA: We are now, as a nation, held hostage to the predictable -- and predicted -- disarray that has followed.

SCHNEIDER: So, what is the U.S. fighting for now in Iraq?

BUSH: ... that America must not fail in Iraq, because you understand that the consequences of failure would be grievous and far reaching.

SCHNEIDER: We are fighting not to lose.

(END VIDEOTAPE)

SCHNEIDER: This is a different war from the one that brought down Saddam Hussein. Some Democrats are arguing, a new war should require a new authorization from Congress -- Wolf.

BLITZER: As you know, Bill, in our post-State-of-the-Union- address CNN/Opinion Research Corporation poll, 41 percent of those asked who actually saw the speech reacted very positively to what the president had to say. What do you make of that?

SCHNEIDER: Well, it looks like a pretty good figure, very positive response, but, actually, it's a bit less positive than the response to President Bush's previous State of the Union speeches, in each case, among those who watched the speech.

One of the interesting things here is that the audience for this speech was not as Republican as the audience for his previous speeches. Normally, a president mostly collects an audience of people from his own party, who are obviously fans. This time, it was evenly divided between Republicans and Democrats.

Why? A lot of Democrats wanted to watch last night, because they wanted to see the new Democratic Congress and they wanted to see the new Democratic speaker, Nancy Pelosi. So, it was a more evenly balanced audience. And the response not as positive as it has been in the past.

BLITZER: All right, Bill -- Bill Schneider crunching the numbers for us, as he always does.

Coming up: Israel's president right now under incredible pressure to step down. We are going to tell you why. That's coming up.

Also, a major battle breaks out in the streets of Baghdad. Our Arwa Damon was on the front lines as U.S. troops fought it out with Iraqi insurgents. Her report is coming up right at the top of the hour, right here in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: Our Carol Costello is monitoring the wires, checking in with our producers and reporters, keeping an eye on all the video feeds coming into THE SITUATION ROOM from around the world.

She's joining us now live from New York with a closer look at some other important stories.

Hi, Carol.

CAROL COSTELLO, CNN CORRESPONDENT: Hi, Wolf. Hello to all of you.

Israel's president, Moshe Katsav, is defiantly refusing to step down, in the face of allegations that he committed sex crimes, including rape. Israeli Prime Minister Ehud Olmert is among those calling on him to step down.

But, in a fiery news conference just a short time ago, Katsav offered to temporarily give up power, but said he would resign only if formally charged. He calls the allegations against him -- quote -- "poisonous and horrible lies."

For the second time this month, the U.S. military has launched an airstrike in southern Somalia. Military officials are now confirming that, earlier this week, an AC-130 gunship launched a strike targeting a so-called mid-level al Qaeda operative. The operative reportedly survived the attack and was taken into custody by Ethiopian troops in the region. Around six other people are believed to have been killed.

Two weeks ago, a bill to increase the minimum wage breezed through the House of Representatives. But now the Senate is saying, not so fast. In a vote on the Senate floor today, the legislation, as it's currently written, failed to advance. Opponents say, it must be accompanied by new tax breaks for restaurants and other businesses that rely on cheap labor. The bill would raise the minimum wage from $5.15 to $7.25 an hour.

The former lead prosecutor in the sexual assault case against three Duke University lacrosse players is facing more ethics charges. The North Carolina state bar now says the Durham district attorney misled the judge and withheld DNA evidence from the defense. He already faces ethics charges stemming from comments he made to the media about the case.

Rape charges against those players were dropped last month, but they still face sexual assault and kidnapping charges.

That's a look at the headlines right now -- Wolf.

BLITZER: See you back here in a few minutes. Carol, thanks for that.

And coming up: Vice President Dick Cheney takes issue with suggestions that there's a backlash among Republicans over the war.

(BEGIN VIDEO CLIP)

BLITZER: Some of your good Republican friends in the Senate and the House, are now seriously questioning your credibility, because of the blunders, of the failures. Gordon Smith -- Gordon Smith...

CHENEY: Wolf -- Wolf, I simply don't accept the premise of your question. I just think it's hogwash.

(END VIDEO CLIP)

BLITZER: Straight ahead in the next hour, our correspondent in Iraq will take a closer look at the front lines in the battle for Baghdad -- that, more of my interview with Dick Cheney, all coming up, right here in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: Let's return now to my exclusive interview with the vice president of the United States, Dick Cheney.

We pick up with Iraq once again and the Democratic and Republican criticism of the administration's war policy and plans for a U.S. troop buildup.

(BEGIN VIDEOTAPE)

BLITZER: Here's what Jim Webb, the senator from Virginia, said in his Democratic response last night.

(BEGIN VIDEO CLIP)

WEBB: The president took us into this war recklessly. We are now, as a nation, held hostage to the predictable and predicted disarray that has followed.

(END VIDEO CLIP)

BLITZER: And -- and it's not just Jim Webb. It's -- some of your good Republican friends in the Senate and the House are now seriously questioning your credibility because of the blunders, of the failures.

Gordon Smith -- Gordon Smith...

CHENEY: Wolf, Wolf, I simply don't accept the premise of your question. I just think it's hogwash. Remember...

BLITZER: What, that there -- there were no blunders?

CHENEY: The -- remember...

BLITZER: The president himself says there were...

(CROSSTALK)

CHENEY: Remember me -- remember with me what happened in Afghanistan. The United States was actively involved in Afghanistan in the '80s, supporting the effort against the Soviets. The Mujahedeen prevailed. Everybody walked away.

And, in Afghanistan, within relatively short order, the Taliban came to power. They created a safe haven for al Qaeda. Training camps were established, where some 20,000 terrorists trained in the late '90s. And, out of that, out of Afghanistan, because we walked away and ignored it, we had the attack on the USS Cole, the attack on the embassies in East Africa, and 9/11, where the people trained and planned in Afghanistan for that attack, and killed 3,000 Americans.

That is what happens when we walk away from a situation like that in the Middle East.

BLITZER: But there were -- but there were blunders that were made.

CHENEY: Now, you might -- you might have been -- you might have been able to do that before 9/11. But, after 9/11, we learned that we have a vested interest in what happens on the ground in the Middle East. Now, if you are going to walk away from Iraq today and say, well, gee, it's too tough, we can't complete the task, we just are going to quit, you will create exactly that same kind of situation again.

Now, the critics have not suggested a policy. They haven't put anything in place. All they want to do, all they have recommended is to redeploy or to withdraw our forces. The fact is, we can complete the task in Iraq. We're going to do it. We have got Petraeus -- General Petraeus -- taking over. It is a good strategy. It will work. But we have to have the stomach to finish the task.

BLITZER: What if the Senate passes a resolution saying, this is not a good idea. Will that stop you?

CHENEY: It won't stop us.

And it would be, I think, detrimental, from the standpoint of the troops, as General Petraeus said yesterday. He was asked by Joe Lieberman, among others, in his testimony, about this notion that somehow the Senate could vote overwhelmingly for him, send him on his new assignment, and then pass a resolution at the same time and say, but we don't agree with the mission you have been given.

BLITZER: So, you're moving forward, no matter what the Congress does?

CHENEY: We are moving forward. We are moving forward.

The Congress has control over the purse strings. They have the right, obviously, if they want, to cut off funding. But, in terms of this effort, the president has made his decision. We have consulted extensively with them. We will continue to consult with the Congress.

But the fact of the matter is, we need to get the job done. I think General Petraeus can do it. I think our troops can do it. And I think it's far too soon for the talking heads on television to conclude that it's impossible to do; it's not going to work; it can't possibly succeed.

(END VIDEOTAPE)

BLITZER: We're going to have much more of my interview with the vice president. That's coming up here in THE SITUATION ROOM.

What does the vice president think about the prospects of Senator Clinton in the White House? More of the interview, that's coming up in the next hour.

But, up next, our "Strategy Session," the Cheney interview, among other things -- as you just heard the vice president say, more U.S. troops will be on the ground, no matter what the Senate passes, as far as resolutions are concerned. We will get to that in the "Strategy Session."

Also: Senator John Kerry, the one-time Democratic presidential nominee, now bowing out of the 2008 race for the White House. Did he flinch from a fight with a front-runner, a front-runner named Senator Hillary Clinton? We will ask Paul Begala and J.C. Watts. They're standing by in our "Strategy Session."

(COMMERCIAL BREAK)

BLITZER: Vice President Dick Cheney strongly sticking to his guns, as far as the war in Iraq is concerned.

And a major critic of the president's Iraq policy, Senator John Kerry, now saying he's not going to run for president again.

In our "Strategy Session" today: reaction to both of these political developments.

Joining us, former Republican Congressman J.C. Watts and Democratic strategist Paul Begala.

Guys, thanks very much.

If the president's tone last night, as far as Iraq was concerned, Paul, was somewhat humble -- and I think it was -- the vice president today, he's not budging at all. In our interview, he's very firm in defending the decisions and insisting this strategy can still work.

PAUL BEGALA, CNN POLITICAL ANALYST: Really, it's stunning. It's a great interview, and -- because we saw the real Dick Cheney, you know, a really remarkable, probably historic, combination of arrogance, incompetence and dishonesty.

This is a man who, when he took office, Richard Clarke, the chief counterterrorism czar, told him that bin Laden was going to try to attack America. He ignored it. The president told him to chair a task force on terrorism. He refused to even convene it until after 9/11. He was too busy helping his friends at Enron and Exxon with his energy task force.

He told the country that Iraq was an imminent threat. He was wrong. He told us that they had a nuclear program -- he was wrong -- biological stockpiles, chemical stockpiles, that there were links to al Qaeda, that there were secret meetings between Mohamed Atta, the leader of the hijacking ring that attacked us on 9/11, and Saddam Hussein's government; they had a secret meeting in Prague. That was a fabrication as well -- on and on.

It really is staggering, the -- the level of this man's mendacity and arrogance, in the face -- if he had any decency, he would simply resign, Wolf. He would give you an interview. He would say: You know, I give up.

BLITZER: He was...

BEGALA: I have ruined -- I have ruined the country in my first term. I'm ruining the world in my second term.

BLITZER: He -- he...

BEGALA: I'm out.

BLITZER: In fairness to the vice president, he was twice elected by the American people to get...

BEGALA: He was once elected.

BLITZER: He was twice elected by the American people.

Go ahead, J.C.

J.C. WATTS, CNN POLITICAL ANALYST: And -- and -- and I do, Wolf, think my friend is extremely unfair to the vice president.

When you consider -- forget about what happened on 9/11, 2001, under the -- under -- under the Bush administration, with Cheney as vice president. The vice president just pointed out all the things that happened in the Clinton administration, bombing of the USS Cole, bombing of the African embassies, the World Trade Center in New York. I mean, there's a lot of different things we can point to. But...

(CROSSTALK)

BLITZER: The first bombing in '93.

WATTS: I'm -- I'm sorry. That's right, the first bombing in '93.

But, be that as it may, that is not the issue. The issue is, we are in a war. I think the president and the vice president just laid out the consequences of failure.

I think they did it very well last night in the State of the Union address. I think the vice president pointed out some things to you in that interview to say: Guys, we're in a war. And -- and I think we have to conduct ourselves accordingly.

BLITZER: All right.

WATTS: We can't afford to lose it.

(CROSSTALK)

BEGALA: There's another war going on, not just a civil war in Iraq, the civil war in the Bush/Cheney White House, which -- which I had no idea was going on.

I don't -- don't have the sources inside that White House that you do. But the -- the Scooter Libby trial -- the vice president's top aide is under trial for federal charges of perjury.

In the opening statements and the first couple of witnesses, the prosecution, at least, and the defense are starting to paint a picture of an effort to smear Joe Wilson, the ambassador who had put out that President Bush didn't tell the truth in his -- in his State of the Union address, when he said Iraq was trying to buy uranium, an effort to smear him, directed not by political hacks, who I always thought was behind it, but by the vice president himself.

A CIA official testified today that the vice president's chief of staff called him and -- and really gave him a very hard time...

BLITZER: We're going to...

(CROSSTALK)

BEGALA: ... about -- about that whole Valerie Wilson situation.

BLITZER: .. have a -- a report in our next hour on this latest development.

But go ahead, quickly, because I want to speak about John Kerry.

(CROSSTALK)

WATTS: But -- but you can't say -- you can't take a snapshot of something that happens in a trial, and say, oh, the vice president is guilty. We need to let this thing play out.

BEGALA: We need him to testify.

WATTS: They obviously...

(CROSSTALK)

BEGALA: I can't wait to see him...

(CROSSTALK)

BLITZER: He will be testifying.

(CROSSTALK)

WATTS: ... rebuttal on that. And I think it's fair...

(CROSSTALK)

WATTS: ... to the vice president to say, let this thing play out before we start throwing arrows.

BEGALA: I want to see him testify.

BLITZER: He will. He told me today he will be testifying, and that's why he doesn't want to comment on it.

BEGALA: You bet.

BLITZER: But let's talk about John Kerry.

Among the Democratic candidates, who wins by John Kerry's announcement today he's not going to run?

BEGALA: You know, I'm not sure, to tell you the truth. But perhaps it's -- it's John Edwards or -- or Barack Obama. I think probably not Hillary Clinton. I think, actually, Senator Clinton, as the front-runner, benefits from a large field, because there is an anti-Hillary vote in my party. And there is certainly in the Republican Party.

And I guess she probably would rather see that divided up among five or 10 or 20 opponents. I think a bigger field helps Senator Clinton.

And I will say, for Senator Kerry, it at least shows, first, that he's more grounded in the reality-based community than President Bush is, that the -- the groundswell for him was not there, but also that he's committed to taking the fight on Iraq. He spoke for 50 minutes about Iraq. He really gave a -- a beautiful and heartfelt speech about that.

So, I think he can help his party and the cause even more without running.

BLITZER: What do you think, J.C.?

WATTS: I -- I think John Edwards benefits from it.

And I think, when you consider what John Edwards has established at this point, with his relationship with the unions, John Kerry was very well established there. So, the -- the -- the short and -- the quick and easy is, I think John Kerry (sic) does.

BLITZER: John Edwards.

WATTS: I mean John Edwards -- John Edwards.

BLITZER: John Edwards.

And, by the way, I just want viewers to know that Edwards is now responding formally to the decision by John Kerry to go ahead and step down, and not run for election for the White House.

Edwards issued a statement just a little while ago about the -- his running mate back in 2004.

Let me read it to you: "Elizabeth and I forged a special friendship with John and Teresa in the 2004 campaign, both as competitors and as teammates. We will be forever grateful to them for the opportunity to work and fight together in our common effort to change the course of our country."

Guys, thanks very much for coming in.

(CROSSTALK)

BLITZER: And still to come: "The Cafferty File." How can there be progress in Iraq, when most parliament members in Baghdad don't actually show up for work? Jack with your e-mail -- when we come back. (COMMERCIAL BREAK)

BLITZER: Let's check back with Jack Cafferty in New York for "The Cafferty File" -- Jack.

CAFFERTY: Wolf, the question this hour is: How can there be any progress in Iraq, when most of the members of parliament don't bother to show up for work?

Dave writes from California: "Jack, it has never been likely this so-called Iraqi government could accomplish anything. Think about it. They exist only in the fortified Green Zone. They're set up with some buildings, some rooms with flags, some pens and paper, and some phones. And then we bark at them to fix the militia problem. What we can expect from that situation is exactly what we're going to get: nothing."

Steven in Astoria, Oregon: "How many U.S. lawmakers would attend sessions if there were serious risk to life and limb? The fact that so few manage to make it to the assemblies could well be a sign of just how dangerous Iraq has become."

John in Philadelphia: "This is the government we get after four years of war and after losing over 3,000 American lives? This is the government that's supposed to unite the country and end a civil war? The poor attendance by Iraqi members of parliament, yet another measure of how ineffectual that government is and how futile the effort to base our exit on their success is."

Michelle in Dothan, Alabama: "My husband just returned from a six-month tour in Iraq in November. I think he took off one day during the entire six months. How about this idea? Every day, someone take a roll call in the Iraqi parliament and determine the attendance percentage. The next day, that same percentage of U.S. soldiers will show up to protect Iraqi citizens. Everybody else can have the day off, get some much-needed rest, catch up on e-mail to family and friends."

Spencer in Nova Scotia writes: "The Iraqi members of parliament know their government is totally illegitimate, and that is why they don't attend. Anybody even slightly aware of international law knows, an election cannot be legal if a country is under occupation when the election is held."

And Jay in Birmingham, Alabama: "Looks like our efforts to bring American-style democracy to Iraq are finally succeeding: corruption, poor border control, a do-nothing legislature. All they need now is a war-mongering president, and the transformation will be complete. Freedom is on the march."

(LAUGHTER)

CAFFERTY: Wolf.

BLITZER: Jack, thank you for that.

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