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Iraq: Moving "Goal Posts"; President Bush on the Road; Interview With Congressman Christopher Shays

Aired July 19, 2007 - 16:00   ET

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


JOHN KING, CNN ANCHOR: And happening now, a new warning from the top U.S. diplomat in Baghdad to Americans expecting results in Iraq by September. But impatient senators fire back as time is running out.
Also this hour, Rudy Giuliani's unique appeal to Christian conservatives. They don't like his stance on abortion and gay rights. So why are so many on the right supporting him anyway?

And the poor man's candidate. Is it John Edwards or Barack Obama? The two Democratic presidential contenders are trying to one- up each other in fighting poverty.

Wolf Blitzer is off today. I'm John King.

You're in THE SITUATION ROOM.

The Bush administration is being accused again today of trying to move the goal posts for success in Iraq. The U.S. ambassador to Baghdad, Ryan Crocker, sent a message to senators all the way from the Iraqi capital. He told them, in effect, that when it comes to that September progress report everyone's been talking, don't hold your breath.

Let's go now to our congressional correspondent, Dana Bash.

Dana, some candid talk from Ryan Crocker today.

DANA BASH, CNN CONGRESSIONAL CORRESPONDENT: That's right. And much more so in private, apparently, than in public.

You know the administration has been pleading with lawmakers for patience until September to perhaps see if then the surge is working. Well, Pentagon and congressional sources tell CNN that in a private meeting at the Pentagon, the U.S. ambassador to Iraq warned lawmakers that he does not think that the Iraqi government will meet most of its benchmarks, or at least will have difficulty doing so by September.

(BEGIN VIDEOTAPE)

BASH (voice over): After privately warning lawmakers that the Iraqi government likely will not meet benchmarks showing progress, in public testimony the U.S. ambassador to Iraq tried to downplay the importance of those benchmarks, devised by his own administration as a reliable way to judge success.

SEN. JOHN KERRY (D), MASSACHUSETTS: Where do we go in looking for that political compromise if you're moving the goal posts at this point in time?

BASH: Testifying by video link from Baghdad, Ryan Crocker did talk candidly of the Iraqi government's troubles. He blamed it on scars left by Saddam Hussein.

RYAN CROCKER, U.S. AMBASSADOR TO IRAQ: If there is one word that I would use to sum up the -- the atmosphere in Iraq on the streets, in the countryside, in the neighborhoods, and at the national level, that word would be "fear".

BASH: The technology of this unusual testimony failed a few times.

SEN. JOSEPH BIDEN (D-DE), PRESIDENTIAL CANDIDATE: Baghdad, can you hear the U.S. Senate? I'll say it another way.

Ambassador Crocker, can you hear Joe Biden?

No, they obviously can't hear.

BASH: But the ambassador did hear loud and clear the growing impatience from the president's fellow Republicans.

SEN. GEORGE VOINOVICH (R), OHIO: It's urgent for them to get involved. Is there a sense of urgency? What are you doing to let them know that this time is running out? Time is running out.

CROCKER: Senator, that is a point we have made to the prime minister, to the rest of the Iraqi leadership.

BIDEN: I promise you, old buddy, forget what Joe Biden says. Listen to the Republicans.

We ain't staying. We're not staying. We're not staying.

Not much time. Political benchmarks better be met or we're in real trouble.

(END VIDEOTAPE)

BASH: Now, this hearing is part of a stepped-up effort by the administration to engage lawmakers and Congress in what's going on in Iraq, and that's something, of course, they have been accused of not doing so much in the past.

About 100 lawmakers actually went over to the Pentagon today, John, and they had a private briefing from Baghdad. They heard from the general on the ground there, David Petraeus, as well as the ambassador you just heard, Ryan Crocker.

KING: You say, Dana, only about 100 members of Congress went over to the Pentagon for that private briefing. Were all 435 -- all 535, if you include the Senate, were they invited? And if so, why didn't more go?

BASH: Well, you know, that's a bit of controversy, and it's growing here.

Apparently, most of the lawmakers, certainly all in the Senate and about half in the House, were invited. And it's really unclear why most didn't go. Or I should say many didn't go, at least.

I'll tell you that the Democratic leaders in the Senate, they are accusing the White House of essentially not letting them know and the Pentagon not letting them know. Dick Durbin, the number two senator -- Democrat in the Senate, I should say, he said that he never got any indication of it. Never got any invitation at all. Others did, too.

The Senate majority leader, though, said he does not think it's sinister. He just thought it was shoddy staff work because they are trying so hard to engage Congress. It was done at the last minute.

We're trying to find out from over at the White House and the Pentagon.

KING: Something else to argue about.

Dana Bash on Capitol Hill.

Dana, thank you very much.

And a top commander in Iraq tells Pentagon reporters today he's seen significant success in Iraqi security over the past four weeks. But Lieutenant General Raymond Odierno says he'll need at least until November to know whether that success is continuing. And Odierno urged members of Congress to be patient, warning any quick military change of strategy would put U.S. troops and the Iraqi people in danger.

Our Pentagon correspondent, Jamie McIntyre, will have much more on that a bit ahead.

Also from the Pentagon, a stinging rebuke of Senator Hillary Clinton. An undersecretary of defense reportedly argues the Democratic presidential candidate is promoting enemy propaganda by asking questions about the U.S. exit strategy in Iraq. The Associated Press reports Eric Adelman (ph) sent that biting reply this week to Senator Clinton about questions she asked the Pentagon back in May.

President Bush is returning to the White House this hour from Tennessee. Once again today, he found the Iraq war was the elephant in the room. The subject people obviously want to talk about.

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

Ed, why did Mr. Bush head down to Tennessee?

ED HENRY, CNN WHITE HOUSE CORRESPONDENT: Well, John, you know the markets are roaring right now. Mr. Bush wanted to talk up a good economy, charging that Democrats want to raise your taxes, joking even at one point because he was at a bun company -- he said, "You can't make any buns if the Democrats take all your dough." But amid all the humor, as you noted, inevitably the conversation is going to turn to the very serious subject of Iraq. And most noteworthy about the president's remarks today is he got very emotional as he introduced Sergeant James Kevin Downs (ph).

Now, he serves in the Army National Guard, lost both his legs in Iraq. And it's interesting. The President getting emotional just one day after the defense secretary, Robert Gates, last night even got more emotional, broke down at a Marine dinner.

(BEGIN VIDEO CLIP)

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: One of the young men I have met during my presidency -- I did so in my home state of Texas -- who is with us today, a man who is recovering from terrible injury but has never lost the spirit of life, Kevin Downs (ph).

(APPLAUSE)

(END VIDEO CLIP)

(BEGIN VIDEO CLIP)

ROBERT GATES, DEFENSE SECRETARY: I write notes to the families of young Americans like Doug Zimbiac (ph) for you and for me. They are not names on a press release or numbers updated on a Web site. They are our country's sons and daughters.

(END VIDEO CLIP)

HENRY: Now, despite all of that raw emotion about the human toll of this war, the White House offering up nothing new in terms of a strategy today in the president's speech. Instead, again, he was pleading for patience until that September report.

And, in fact, White House officials say that a private session on Friday that the President had with conservative newspaper and magazine columnists, the President made clear he's not shifting strategy, not going to pull out U.S. troops before the September report. But in the words of one senior official here, after that report in September, everything is on the table -- John.

KING: Everything is on the table. Words to remember. Something to keep watching.

Ed Henry at the White House.

Ed, thank you very much.

And time now for "The Cafferty File". Jack join us from New York -- Jack.

JACK CAFFERTY, CNN ANCHOR: John, Atlanta Falcons quarterback Michael Vick is going to be allowed to continue playing football pending the outcome of federal felony charges against him for sponsoring a gruesome dogfighting operation. The NFL and the team, the Atlanta Falcons, have decided to take no action against Vick, despite the NFL's personal conduct policy.

What message does that deliver?

Vick is certainly not the first professional athlete to get in trouble with the law. But this case is different.

An athlete can choose to take steroids or drive drunk or assault someone or beat up their wife or do drugs or whatever. These dogs don't have a choice. These are helpless animals that are forced to fight for their very lives.

They sustain horrific injuries, and according to the federal indictment against Michael Vick, the losing dogs in these contests either die in the ring or are electrocuted, drowned, hanged, or shot. This is how a multimillionaire professional athlete amuses himself.

And it's all done so a bunch of mentally defective morons can get their kicks by watching this utter cruelty and making bets on the outcome. It is truly pathetic.

So here's the question: Should Atlanta Falcons quarterback Michael Vick be allowed to continue playing professional football while he answers charges of sponsoring dogfights?

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

KING: Jack, it's a great question. We look forward to the answers.

And you want to stay with us as well, because later I'll ask music mogul Russell Simmons about the Michael Vick dogfighting scandal and what he thinks should happen.

Also ahead, a Republican congressman who was in a classify question-and-answer session today with the top U.S. commander in Iraq. I'll ask Chris Shays whether he left that session with new concern or new hope.

Plus, the woman at the center of the CIA leak case gets handed a legal ruling. Does Valerie Plame Wilson have a case against the Bush administration?

And it's the summer of "Harry Potter," and one presidential candidate is feeling the magic.

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

(COMMERCIAL BREAK)

KING: Dozens of U.S. lawmakers went to the Pentagon today to get a top-secret briefing from the top commander in Iraq.

(BEGIN VIDEOTAPE)

KING: Congressman Chris Shays, Republican of Connecticut, thank you for joining us today in THE SITUATION ROOM.

You were among a large member of Congress today who received a classified briefing from General David Petraeus over at the Pentagon. I know the details of that briefing, sir, are classified. But I want to get your sense.

Did you leave that briefing more optimistic or more pessimistic about the Bush administration's strategy in Iraq?

REP. CHRISTOPHER SHAYS (R), CONNECTICUT: Well, I didn't leave it less optimistic, because I haven't been all that optimistic in the last few weeks. But the bottom line for me is this: we do not have the force structure to maintain the level of troops we have in Iraq now, and certainly to increase them.

So, whatever General Petraeus tells us in September, we are still going to have to reduce the number of troops in Iraq. And that's why I think it would be wise to let the Iraqis know that now, that there will be a gradual reduction in troops.

KING: Well, you say we don't have the force structure. What should be done in the short term, then, if we don't have the force structure?

And as you await that report in September, I know you're just back from I believe your 17th trip in Iraq recently. And you sent this letter that I have here to Secretary Gates in which you think the Iraq Study Group should be reconstituted so that you have an independent assessment once General Petraeus comes forth with that report in September.

Do you, sir, simply not trust that you will get an independent or an unbiased report from General Petraeus?

SHAYS: No, I think we'll get a very accurate report from General Petraeus. But it will be people who have been there a year ago who have been away who will now come back, and it will be fascinating to say, you know, we see this better, we don't see this going as well as it was a year ago.

So, they have a perspective that's tremendously unique. And in addition, they have the confidence of both sides of the aisle, as does Mr. Petraeus. So, if both reports seem to parallel each other, that will be very helpful, and if they don't, that will get us to ask the questions we need to ask.

KING: I know you have disagreed with the Democratic plan to set a timeline for troop withdrawal, saying that's a precipitous withdrawal of U.S. troops.

SHAYS: Right.

KING: But if you do not get an optimistic assessment from General Petraeus in September, although it seems to me you're saying even if you do, the United States can't sustain its troop levels for some time, as you know, the administration has publicly chastised the Democrats, saying it's reckless to talk about, publicly talk about withdrawing U.S. troops, and yet you are saying the administration should be in those negotiations with the Iraqis right now.

Are you prepared in September, if the administration isn't willing to move, to support measures that call for a troop withdrawal?

SHAYS: Well, I introduced, when we were taking up that resolution, I asked the Rules Committee that decides what can come before the floor when we debate a bill to allow an amendment I had to say that in April of '09, our troops should withdraw. When I went before the Rules Committee, I said, let's even move it up to the end of '08.

So I believe there should be a timeline. I believe the Iraqis should know about this timeline. I just think it should be a workable timeline.

I totally disagree with the administration that a timeline would be irresponsible, if that's what they're saying. It's the responsible thing to do.

In fact, they already know that we're going to have to reduce the number of troops. We do not have the force structure to maintain this level.

KING: While some members of Congress were over at the Pentagon getting that briefing from General Petraeus, members of the Senate Foreign Relations Committee were listening to Ambassador Crocker from Baghdad offer his assessment of the political situation in Iraq, and he said if he had to sum up in one word the mood on the streets of Iraq, that word would be "fear".

SHAYS: Right.

KING: Now, he says that traces back to still the agitation after losing Saddam Hussein, after being under the rule of a dictator. But after four years and three months, $500 billion and the deaths of 3,500 American young men and women, for the Bush administration's top diplomat to say if he had to sum up Iraq in one word, it would be "fear," what does that tell you, sir?

SHAYS: Well, I mean, it's just a very honest assessment. The Iraqis are fearful we might leave too quickly. That's one of their fears. They're fearful that they will not be able to get it to work.

You know, they're trying to build consensus among Shias, Sunnis and Kurds. They're not trying to look for 50 percent of the vote plus one.

They're doing something even the United States Senate can't do. They can't muster 60 percent of the vote. The Iraqis have to muster, like, 75 percent of the vote. They're trying very hard. They could pass something with 50 percent of the vote.

The one problem is, the Shias are learning to develop that they have to have confidence in the Sunnis and vice versa, and the Kurds. It's a process that is taking some time.

They have made improvements. But they are still very afraid.

Are the Democrats going to win? Are we going to leave precipitously, like April of next year? That's the thing to be afraid of.

KING: Let me ask you one last question...

SHAYS: Sure.

KING: ... on the war on terror, not related to Iraq.

In "The Washington Post" today, this editorial: "If Pakistani forces cannot or will not eliminate the sanctuary, President Bush must order targeted strikes or covert actions by American forces, as he has done several times in recent years."

That editorial referring to al Qaeda sanctuaries just over the line from Afghanistan into Pakistan.

A wise move for something -- for the president to consider?

SHAYS: Oh, absolutely. And the fear that might change the policy in Pakistan.

KING: And if the Pakistani government won't do more, sir, you say the United States should be prepared?

SHAYS: If the Iraqi -- if the Pakistani government will not take action, we would have to take action.

KING: Do you think the administration is prepared to do that, given the current politics in this country?

SHAYS: I'm not sure. But it's not land forces that we're talking about, it's air strikes. And that's a big difference.

KING: Congressman Christopher Shays of Connecticut.

Sir, thank you for your time today.

SHAYS: Thank you.

(END VIDEOTAPE)

KING: Coming up, her identity as a CIA operative was leaked. Does that give her a legal case against the Bush administration? A judge's answer ahead.

Plus, she stood by her man. Now he's standing by her. Bill Clinton defends his wife against barbs from Elizabeth Edwards.

Paul Begala and Bill Bennett are standing by for our "Strategy Session".

(COMMERCIAL BREAK)

(NEWSBREAK)

KING: And a new development to report today in the CIA leak case. At issue, a lawsuit by outed operative Valerie Plame Wilson against members of the Bush administration.

Our Brian Todd is standing by to cover that ruling -- Brian.

BRIAN TODD, CNN CORRESPONDENT: Well, John, two and a half weeks after Scooter Libby's sentence was commuted, more bad news for Joe and Valerie Wilson. A federal judge throws out their lawsuit against Libby, Vice President Cheney, Karl Rove and other top officials of the White House, current and former.

Judge John Bates (ph) saying essentially the Wilsons failed to show the case belongs in federal court. Judge Bates (ph) did say in the ruling that the suit raises important questions about the actions undertaken by top officials, but right now it looks like the Wilsons will have to pursue other avenues.

They had filed the suit just over a year ago alleging that Cheney, Libby, Rove and the others conspired to destroy their careers after Valerie Wilson's covert CIA identity was disclosed to the media. That, of course, coming after Joe Wilson wrote an op-ed piece questioning the Bush administration's prewar intelligence.

Now, the Wilsons' attorney, Melanie Sloane (ph), just a short time ago issued a statement saying, "While we are obviously very disappointed by today's decision, we have always expected that this chase would ultimately be decided by a higher court. We disagree with the court's holding and intend to pursue this case vigorously to protect all Americans from vindictive government officials who abuse their own power for their own political ends."

A spokeswoman for Vice President Cheney would only say that he is pleased that the court dismissed the suit. We have not yet heard from Scooter Libby's attorneys -- John.

KING: So, a big ruling, but not the last word.

TODD: Probably not, no.

KING: Brian Todd, thank you very much.

Up next, some say Rudy Giuliani could never win the GOP nomination because of his moderate views on social issues. Are Christian conservatives ready to prove those predictions wrong?

And Fred Thompson is positioning himself as a tried and true conservative. But now a past job is raising questions about the presidential prospect's stance on abortion.

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

(COMMERCIAL BREAK) BLITZER: Happening now, rooting out al Qaeda and the Taliban from the tribal regions of Pakistan. There's said to be a fresh offensive under way by the Pakistani military, but U.S. officials wonder if it will work.

More fears about the safety of some Chinese products. First it was the shocking report saying cardboard was being used in a popular snack in China. Now there's a new twist to that story.

And as football player Michael Vick faces dogfighting charges, music mogul Russell Simmons says he wants anyone found guilty of dogfighting to be harshly punished.

Russell Simmons will join me.

Wolf Blitzer is off today. I'm John King.

You're in THE SITUATION ROOM.

Republican presidential candidate Rudy Giuliani swings through Iowa hoping for support to win the state's first-in-the-nation caucuses. Giuliani says he would lead the United States away from foreign oil, partly with increases in ethanol production. Iowa, go figure, is the leading ethanol-producing state.

Yesterday he visited conservative western Iowa, saying if he became president, he'd appoint judges who strictly interpret the Constitution.

CNN Senior Political Correspondent Candy Crowley joins me now from Charleston, South Carolina, where our YouTube debate is up Monday night.

Candy, all this, I assume, part of Mayor Giuliani's effort to reach out to skeptical conservatives.

CANDY CROWLEY, CNN SR. POLITICAL CORRESPONDENT: Absolutely. And what's interesting, John, is you know that it used to be an article of faith and politics that the Christian right, in particular Evangelicals, would only vote for anti-abortion candidates. But in 2008, Rudy Giuliani may change that.

(BEGIN VIDEOTAPE)

CROWLEY (voice over): Allen Rawley owns a printing shop in Spartanburg, South Carolina.

ALLEN RAWLEY, SOUTH CAROLINA VOTER: My dad was a pastor. I grew up in a Christian home. And those values were absolutely most important to me. Pro-life is extremely important to me.

CROWLEY: Ad yet here, deep in the Bible Belt, this self- described conservative Christian right voter says he might vote for Rudy Giuliani.

RAWLEY: And I believe Giuliani would be the kind of leader that would be resolute and recognize that there's a threat there, we have to face it.

CROWLEY: Richard Land is a leading voice of Evangelicals who says he would never vote for Giuliani but understands why others will.

RICHARD LAND, PRESIDENT, SOUTHERN BAPTIST CONVENTION ETHICS AND RELIGIOUS LIBERTY COMMISSION: Well, we are in a war. And I -- I personally think that -- that, for many voters, whatever their moral values are, they're going to say to themselves, which one of these people do I think will make me and my family safer?

CROWLEY: A June CNN/Opinion Research Corporation poll found that, among Christian conservatives, Giuliani led the other potential Republican candidates.

DAVID WINSTON, REPUBLICAN CONSULTANT: This gets to sort of a broader concept, in terms of the sort of Republican social conservative base, is, while they're concerned about these issues, they are not being dogmatic about these issues.

CROWLEY: The willingness of the religious right to consider Giuliani is part terrorism, part pragmatism, which is to say, they want to win.

RAWLEY: Facing reality, Giuliani, at this point of announced candidates, is probably our best shot at electing a good, reasonably conservative, strong leader for America.

CROWLEY: But it's not just about finding someone who can win. It's about finding someone who can make sure that Hillary Clinton loses.

LAND: Social conservatives really want a social conservative they can support. But a lot of them also really want to beat Senator Clinton. I think she's the unseen candidate in the Republican primaries.

(END VIDEOTAPE)

CROWLEY: And, in fact, if they are on the Christian right or more moderate Republicans, if you talk to them, you will find out that the big galvanizing force within the Republican Party right now is Hillary Clinton -- John.

KING: And, Candy, South Carolina traditionally has been a decisive state for the Republicans in a contentious nominating battle. How important is it for the Democrats?

CROWLEY: Well, it's huge. You know, I talked to Jim Clyburn, a congressman from -- in fact, whose district includes the Citadel, where this YouTube debate, CNN debate is going to take place, and the fact of the matter is, he can give you a scenario whereby let's say Hillary Clinton wins New Hampshire, John Edwards wins Iowa, and yet you come into South Carolina, and the dynamic can change.

It's very important now that the calender is the way it is, because South Carolina may be the last state where the paid media is not that big a deal. So, they are looking here to be what George Bush once called a firewall. You know, in the Republican Party, George Bush was saved here in South Carolina. And a lot of Democrats think that South Carolina's the first really diverse primary in the primary season, really can play a pivotal part here.

KING: Candy Crowley for us today in South Carolina -- Candy, thank you very much.

And, as Candy just noted, the next presidential debate will be this coming Monday, July 23, at the Citadel in Charleston, South Carolina. CNN is teaming up with YouTube for that debate, the first debate where all of you can submit your questions directly to the candidates online.

New developments today involving another presidential prospect, Fred Thompson. His past work could put him in a bind with crucial conservative voters he's been trying to court.

Our Tom Foreman is following that story.

Tom, what are we learning?

TOM FOREMAN, CNN CORRESPONDENT: Well, John, it comes down to the question, how much does abortion really matter to these folks? And, depending on the answer, it looks like an old job could spell new trouble for the probable presidential hopeful.

(BEGIN VIDEOTAPE)

FRED THOMPSON, FORMER U.S. SENATOR: Belief in the sanctity of human life, these things that have been...

(APPLAUSE)

FOREMAN (voice-over): Fred Thompson certainly sounds like a conservative opposed to abortion rights. And, when he officially jumps into the race for the White House, he's counting on the support of values voters.

But billing records show that, in 1991 and '92, Thompson spent some 20 hours lobbying for a group that was trying to ease federal laws that restricted apportion counseling. The records detailing his work for the National Family Planning and Reproductive Health Association were first reported Thursday by "The New York Times" and also obtained by CNN.

Earlier this month, in response to a "Los Angeles Times" story, Thompson said he had no recollection of doing anything to aid the abortion-rights group. But, last week, the former senator from Tennessee and longtime Washington lobbyist backtracked from that statement.

STUART ROTHENBERG, EDITOR AND PUBLISHER, "THE ROTHENBERG POLITICAL REPORT": I think the controversy is a potential significant problem. Part of his appeal is that he's a Ronald Reagan conservative. And there's a contradiction between that ideal and the reality of his work on the issue of abortion.

FOREMAN: Thompson is already feeling the heat. A posting on YouTube shows his answer in a 1994 Senate debate to a question about supporting or opposing abortions on demand.

(BEGIN VIDEO CLIP, 1994)

THOMPSON: I do not believe that the federal government ought to be involved in that process.

(END VIDEO CLIP)

THOMPSON: What is that problem?

FOREMAN: But Thompson's voting record in the Senate was consistently anti-abortion. So, will the right give him a pass on this current controversy?

ROTHENBERG: The conservative wing of the Republican Party really wants to be able to support somebody. And, because of that, they may be able to move past this.

(END VIDEOTAPE)

FOREMAN: Thompson's spokesman tells us again today that Thompson has no recollection of doing work for the abortion rights group. He goes on to say that it's not unusual, however, for a lawyer, when asked by a colleague, to provide assistance on matters that he personally may disagree with -- John.

KING: Tom Foreman -- Tom, thank you very much.

And Tom Foreman and Candy Crowley are both, of course, part of the best political team on television.

And, remember, for the latest political news at any time, check out the Political Ticker at CNN.com/ticker.

Coming up: Presidential candidates compete to attract attention to a major problem. Poverty is playing a big role in this presidential race. Our Bill Schneider will tell us who is talking most about it.

And Bill Clinton defends his wife from a surprising political attack. You will find out just what the former president had to say.

Stay right here. You're in THE SITUATION ROOM.

(COMMERCIAL BREAK)

KING: John Edwards is trying to put the problem of poverty in America on the political map. He's been touring some of the neediest parts of the country. But now Barack Obama is saying, not so fast. He says Edwards isn't the only Democrat who wants to help the poor.

Let's bring in our senior political analyst, Bill Schneider. Bill, tell us what's happening to the issue of poverty.

WILLIAM SCHNEIDER, CNN SENIOR POLITICAL ANALYST: Well, you know, the Bible says the poor will always be with you. But poverty has been conspicuously absent from recent presidential campaigns, until now.

(BEGIN VIDEOTAPE)

SCHNEIDER (voice-over): Poverty is not a new issue for John Edwards. He talked about two Americas when he ran for president in 2004.

JOHN EDWARDS (D), PRESIDENTIAL CANDIDATE: We have still got two Americas in this country.

SCHNEIDER: This year, Edwards has competition.

SEN. BARACK OBAMA (D-IL), PRESIDENTIAL CANDIDATE: This kind of poverty is not an issue I just discovered for purposes of a campaign. It's the cause that led me to a life of public service almost 25 years ago.

SCHNEIDER: Edwards has just finished an eight-state poverty tour, explicitly evoking Robert F. Kennedy's tour in 1968.

EDWARDS: Poverty looks different now than it did when Bobby Kennedy went throughout Appalachia.

SCHNEIDER: Barack Obama evokes the same image.

OBAMA: When Kennedy turned to the reporters traveling with him, with tears in his eyes, he asked a single question about poverty in America: How can a country like this allow it?

SCHNEIDER: Why is poverty back on the agenda?

EDWARDS: Well, some -- some of the inspiration comes from what America saw happen in the Ninth Ward of New Orleans.

SCHNEIDER: It also has to do with something middle-class and poor people share, economic insecurity in a globalized economy.

OBAMA: Every American is vulnerable to the insecurities and anxieties of this new economy.

SCHNEIDER: In the 1960s, LBJ's war on poverty drove the middle class and the poor apart. Edwards and Obama argue, their interests are the same, working Americans trying to make ends meet in an uncertain world.

EDWARDS: Today, about twice as many people who are working full time live in poverty.

OBAMA: What we can't do is retire the phrase working poor in our time.

(END VIDEOTAPE)

SCHNEIDER: Edwards and Obama are not just squabbling with each other. They are both trying to overtake the front-runner in the polls, Senator Hillary Clinton, who has not yet come out with an explicit anti-poverty program -- John.

KING: I suspect she will feel some pressure now to do so.

Bill Schneider for us.

SCHNEIDER: Yes, she will.

KING: Bill, thank you very much.

And Hillary Clinton learned many years ago that virtually anyone and everyone to be -- have a connection to her may wind up in the legal or media spotlight. That's currently the case for one of the presidential candidate's top political advisers.

Brian Todd is back with that.

Brian, there's a new development in a story you have been following about senior Clinton strategist Mark Penn. What is it?

BRIAN TODD, CNN CORRESPONDENT: That's right, John.

Earlier this month, we reported on lawsuits involving Mr. Penn. He's the chief strategist for Hillary Clinton's presidential campaign. The case never involved Mrs. Clinton or the campaign, but Mark Penn's long association with Bill and Hillary Clinton made the suits newsworthy.

Penn's firm was accused by a former associate, Mitchell Markel, of trying to hack into Markel's BlackBerry. Penn and the firm accused Markel and another former partner of trying to steal their clients.

Now both cases have been settled. It turns out Penn's firm Actually owned the BlackBerry it was accused of wiretapping. And the claims against Markel and his partner were dropped by Penn after Markel and that former partner paid them an undisclosed amount of money.

This information comes to us from Mr. Penn's firm. We have called attorneys for Markel and the other former partner to get their version of this. We have not heard back -- John.

KING: Now, Brian, Mitchell Markel has got his own consulting firm now. Any high-profile clients?

TODD: Well, none that we know of at the moment. And we spoke to them also a couple of weeks ago. They didn't have any back then. The clients he was accused of trying to steal from Penn's firm at time, those included the National Hockey League, Estee Lauder, and, ironically, the makers of BlackBerry. All those clients remained with Penn's firm, we're told.

KING: Emphasis on "ironically."

(LAUGHTER)

KING: Brian Todd for us on a bizarre case -- Brian, thank you very much.

Up next in the "Strategy Session": After four-plus years of fighting in Iraq, the U.S. ambassador to Iraq sums up the mood there this way.

(BEGIN VIDEO CLIP)

RYAN CROCKER, UNITED STATES AMBASSADOR TO IRAQ: If there is one word that I would use to sum up the -- the atmosphere in Iraq, on the street, in the countryside, in the neighborhoods, and at the national level, that word would be fear.

(END VIDEO CLIP)

KING: Should the Bush administration have more to show than fear?

And Senator Clinton's idea that the Pentagon should start plans for withdrawing from Iraq gets a blistering response. Did either side overstep the line?

That's all from Paul Begala and Bill Bennett -- coming up right here in THE SITUATION ROOM.

(COMMERCIAL BREAK)

KING: The American ambassador in Baghdad, Ryan Crocker, says the word he would use to sum up the atmosphere in Iraq is -- quote -- "fear."

Here to talk about that in today's "Strategy Session" are CNN political analyst and Democratic strategist Paul Begala and CNN contributor Bill Bennett, also of the Claremont Institute.

Bill, I want to start with you. Ryan Crocker, talking about the mood on the street, saying, after Saddam Hussein, with all the instability politically now, and from a security standpoint now, if he had to use one word, it would be fear.

Now, he's talking about a legacy of Saddam Hussein and all the issues in Iraq. But, after four years and three months, $500 billion, 3,500 Americans killed in Iraq, that's a pretty damning statement for the Bush administration, isn't it?

BILL BENNETT, CNN CONTRIBUTOR: It is damning. It should be better. I wish it were better.

But we have got to recognize it could be worse. It could be a lot worse. And, if we leave, it will be a lot worse. John Burns was talking to Charlie Rose and said, if we leave, it's a cataclysm, a cataclysm of violence is what we expect. There are some bright lights, though. There are some encouraging signs in Iraq. And that is the stuff we're hearing from generals, from General Petraeus, from General Lynch and others.

Your own Starr...

KING: Barbara Starr, right.

BENNETT: Barbara -- on CNN yesterday pointed out to what was going on in Anbar Province and Ramadi. Extraordinary, she said, the success and effort that's being made.

There's tremendous progress being made on the surge. It's a tough situation. The point is, can it get worse? Shakespeare says it's not the worst as long as you can say it's the worst, and it can get a lot worse.

Right now, given these encouraging signs, we have got to let the surge work. Will things work out? Will things resolve? Will we find some real measure of peace? I don't know. But the alternative seems to be catastrophe.

KING: Do you agree?

(LAUGHTER)

PAUL BEGALA, CNN POLITICAL ANALYST: No, of course not.

KING: Yes, I thought I would see if...

(CROSSTALK)

BEGALA: But let me talk about the political strategy, which I think is really interesting here.

You know, the president's credibility is shot. And, so, they are trotting out Ambassador Crocker, who is an able career diplomat and a very experienced hand in the Middle East. They are trotting out General Petraeus, you know, who is the commander on the ground there.

They are going to be trotting out everybody they can, because, when -- frankly, when President Bush speaks, we don't listen. And, when we do listen, we don't believe him, and for good reason. You know, he's a man who was once at 90 percent in the polls, and now he's collapsed, because the country believes he misled us about this war.

And, having broken those bonds of trust, it's very hard to repair them. So, he can trot out Ambassador Crocker or these other very decent, very able people. At the end of the day, it's the president's war. The country doesn't like it. They want a change in direction.

KING: Let's talk about political strategist, but let's shift to the Democrats. You say the president's political strategist, he's trotting out the diplomat -- your words -- and the general, because he can't speak credibly anymore. Let's talk about the Democrats, though. They had a vote in the Senate, one more attempt to try to force a timeline for withdrawing the troops on the White House. The Senate doesn't have the votes. So, the Democratic leader decides to stop the debate. He could have brought to the floor a Republican proposal that says, let's bring back the Iraq Study Group, which would have been a slap at the White House, not what the Democrats want, not strong -- as strong as they want, but would have been a criticism of the White House and Republicans.

Could have brought the proposals from Senators Warner and Lugar, again, two Republicans, leading Republicans, to the floor, saying, Mr. President, you need to come up with a plan to get the troops. Doesn't have a timeline, but, again, you could have a headline in the paper today that says, Republicans put pressure on White House. Instead, it says Democrats pull their -- pull their Iraq plan from the floor.

A mistake?

BENNETT: Well, talk about credibility.

Yes, George Bush's credibility has been seriously damaged. And we know his approval ratings are 33 percent, more than twice Harry Reid's credibility. I mean, a slumber party may be the right thing over which he should preside.

This was the worst-managed thing. I mean, all week long, the buildup was, more Republicans are defecting. It looks like a run. Republicans are abandoning the ship. At the end, they had four Republican votes, virtually the same four they had going in, except there would have been three or four more -- three or four others, according to Gordon Smith, if the thing had been managed right.

But the thing was managed so, so ineptly. George Bush is at 33. Harry Reid is at 14. Now, we're talking about war and peace, and the credibility and support ratings don't matter so much as doing the right thing.

But the Democrats are not -- I think are not making any headway on this. And, at the end of the day, I don't think this is a win for the Democrats...

(CROSSTALK)

KING: Why not allow votes on other proposals and get a big bipartisan vote? Why does it have to be Harry Reid's way or no way?

BEGALA: Because he actually wants to change the policy.

First of all, keep in mind, I used to have a law professor who said, a brick is not a wall, right, and a tactic is not a strategy. Today, they are not voting on it. They will. And my guess is a whole lot of different options will be on the table and for votes.

I think it's very important -- what Reid has done here is very important. He's shone a light on why it is, after seven months, the Democrats have been in charge, we're still at this war, with no significant change in policy. It is because the country now sees the Republicans are obstructing it. The Republicans have filibustered against a change in policy.

That was an important teaching moment. It was an important debating moment. It was not at all a slumber party. I mean, I'm -- I'm -- I think there's no more important thing for these senators to be doing than to be staying there day and night. They have very nice cots, a lot nicer than those soldiers have in Iraq.

I wish they would go around the clock until they change this policy.

BENNETT: Fine. Debate on the merits. Debate on the facts on the ground. Debate about the number of suicide attacks. Debate about the number of fatalities going down. Debate about the progress in Anbar and Ramadi. Listen to the generals.

You're right. Let's stipulate. You guys don't listen to Bush. We don't listen to Reid. Let's listen to the people on the ground. The vast majority of the American people also believe, Paul, we should wait until September 15. Let's give the surge -- let's see what happens September 15, and then reevaluate.

KING: Want to change the subject to something I assume will not be all that remembered when we get to the end of campaign 2008, but it's causing a few eyebrows to lift right now.

And that is a bit of a fight between Elizabeth Edwards and Hillary Clinton that has the intervention of your former boss Bill Clinton. It started this way. Elizabeth Edwards says this about Hillary Clinton: "Sometimes, you feel you have to behave as a man and not talk about women's issues. I'm sympathetic. She wants to be commander in chief, but she's just not as vocal a woman's advocate as I want to see. John is."

That's Elizabeth Edwards saying her husband is a better candidate for women than the woman candidate in the race.

Then, Bill Clinton goes on ABC's "Good Morning America" this morning to fire back.

Let's listen.

(BEGIN VIDEO CLIP, "GOOD MORNING AMERICA")

BILL CLINTON, FORMER PRESIDENT OF THE UNITED STATES: I don't think it's inconsistent with being a woman that you can also be knowledgeable on military and security affairs and be strong when the occasion demands it. That's -- I don't consider that being manly. I consider that being a leader.

(END VIDEO CLIP)

(LAUGHTER)

KING: Some sort of an attack role for Elizabeth Edwards in this campaign, does this mean anything?

BENNETT: Do you want me?

KING: Sure.

BENNETT: All right. Well, let me make news -- if not news, precedent-breaking. Let me support Hillary Clinton here and back up Bill Clinton.

I don't know what's gotten into Elizabeth Edwards here.

But John, in a very compassionate way -- she's got this terrible affliction. We all feel compassion for her. But he ought to tell her, in a compassionate way, to stop this stuff. This manly woman stuff has no place in politics.

We had this on our team with -- you know, with Jeane Kirkpatrick and Margaret Thatcher, you know, female impersonators. Of course women are strong leaders. Of course they should talk about these issues. Of course they should run for president and will be president some day. It's absolutely ridiculous. And John Edwards needs -- needs to...

KING: The very strong woman in my ear tells me I'm out of time.

You have got 10 seconds.

BEGALA: Let me take up for Elizabeth Edwards, though.

BENNETT: Right.

BEGALA: She said something wholly unremarkable. She supports her husband. Good for her. I mean, there's nothing wrong with saying that. I didn't take that -- I support Hillary. I love Hillary. I worked for her husband.

(CROSSTALK)

BEGALA: I didn't take it as a shot at Hillary.

BENNETT: A brick is not a wall. It's an attack.

KING: Guys, guys...

BENNETT: Come on.

(LAUGHTER)

KING: This guy is going to listen to the now angry woman in my ear and stop.

BENNETT: OK. All right.

(CROSSTALK)

KING: And let's move on. And Jack Cafferty wants to know if a football player, Michael Vick, should be allowed to keep playing as he faces dogfighting charges. Jack has your e-mail.

Also, finished with one tough job, starting up another. Former British Prime Minister Tony Blair steps into his new role as special Mideast envoy.

And a -- and a football player facing dog charges -- back to the Michael Vick story -- music mogul Russell Simmons say this may be a prime opportunity for Michael Vick to speak out about the brutal sport. Russell Simmons will join us right here in THE SITUATION ROOM.

Stay with us.

(COMMERCIAL BREAK)

KING: "Harry Potter and the Deathly Hallows" hits bookshelves at midnight tomorrow. But, despite the best efforts of the publishers to keep the book carefully guarded, what appears to be leaked copies are popping up online.

Internet reporter Abbi Tatton is here with the ending, right, Abbi?

ABBI TATTON, CNN INTERNET REPORTER: No, no way. I'm not giving anything away here. You're safe here if you're a "Harry Potter" fan.

But, online, it's a different story. And the "Potter" fans are mad, because things are popping up all over the place. Imagine. They have been waiting 10 years to finally work out what happens to Harry, and then they click on the wrong Web site, and it's all spoiled.

What's circulating online, photographs of what purports to be every single page of the new "Harry Potter" book, "Harry Potter and the Deathly Hallows." There are also book reviews. And we have even seen a YouTube video that claims to reveal every major part of the book, complete with page numbers.

Well, J.K. Rowling is responding at her site, urging fans to preserve the secrecy. She's going to be doing a live reading tomorrow night in London -- John.

KING: What about the publisher, Abbi? Doing anything to try to stop these leaks?

TATTON: Well, the U.S. publisher, Scholastic, is saying they're pursuing legal action against two companies they say shipped copies early, before the release date. We have already seen on eBay people posting copies that they claim are those early releases -- John.

KING: Abbi Tatton -- thank you very much, Abbi.

And the boy wizard named Harry has created public in the publishing world; 325 million copies of "Harry Potter" books have been sold worldwide, about a third of them sold right here in the United States, more than 121 million copies.

The "Potter" phenomenon translates globally. The books have been published in more than 60 languages. Anticipation for the new book, "Harry Potter and the Deathly Hallows," is so intense, its first printing is a record-setting 12 million copies.

And Jack is in New York now with "The Cafferty File."

Hi, Jack.

JACK CAFFERTY, CNN ANCHOR: The woman who writes those is a billionaire as a result of those sales. Pretty phenomenal stuff.

The question this hour is: Should the Atlanta Falcons quarterback Michael Vick be allowed to continue playing professional football while he answers charges of sponsoring dogfights?

Libby writes from New York: "Maybe Michael Vick should go into the ring with the dogs. He should be jailed. Being allowed to continue playing shows the moral bankruptcy of his team's owners and the NFL."

Marie in Texas writes: "The real animals are the people who stand around and watch this horrific spectacle. They have no souls. Of course Vick shouldn't play. But our country operates on the almighty dollar, not from a sense of morality. We will see how badly the Atlanta Falcons feel they need him to keep the money rolling in."

Darren, San Anselmo, California: "Jack, if Michael Vick is found guilty, he ought to be forced to get in the ring with a couple of those dogs he trained. The guy is subhuman. The fact that his NFL team is not going to at least suspend him until the guilty verdict comes back is par for the course. Remember, this is the league for whom steroid use and its testing is just a pesky annoyance that only gets attention if it affects their TV ad revenue."

Sheldon in Ohio writes: "Unfortunately, there are too many things -- thugs in sports. However, they are still Americans, and therefore, are owed the same rights as all of us, innocence until guilty is proven. Therefore, he should be allowed to make his living. On the other hand, it would be smart business for the Falcons to deactivate him with pay until this thing is cleared up one way or the other."

Milt in San Luis, Colorado: "Jack, Vick should be smeared with liver pate, placed in a small enclosed area with 50 hungry pit bulls, and then turn out the lights. Talk about an animal."

James writes from Schenectady, New York: "People who engage in cruelty to animals in any degree should not see the light of day for many, many years. Our pets give us years of unconditional love and companionship. Love is something Mr. Vick is missing from his empty soul" -- John.

KING: Jack, thank you very much.

And you're in THE SITUATION ROOM. TO ORDER A VIDEO OF THIS TRANSCRIPT, PLEASE CALL 800-CNN-NEWS OR USE OUR SECURE ONLINE ORDER FORM LOCATED AT www.voxant.com

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