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CNN Late Edition with Wolf Blitzer

Interview With Walid Jumblatt; Interview With Robert Zoellick; Interview With Garry Kasparov

Aired October 21, 2007 - 11:00   ET

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

WOLF BLITZER, HOST: It's 11 a.m. here in Washington, 8 a.m. in Los Angeles, 6 p.m. in Baghdad. Wherever you are watching from around the world, thanks very much for joining us for "Late Edition."
A new reminder this week of what's at stake in the war on terror, with a suicide bomb attack in Pakistan only hours after the former Pakistani prime minister, Benazir Bhutto returned from an eight-year exile. U.S. officials say the attack, which left 136 people dead, bears all the hallmarks of Al Qaida.

And also there's a mystery, and it continues over an Israeli air strike on a suspicious facility in Syria. Joining us now to talk about that, Iraq and lot more, two leading members of the U.S. Congress.

In Los Angeles, Democratic Congresswoman Jane Harman. She chairs the House Homeland Security Subcommittee on Intelligence. And in Grand Rapids, Michigan, Congressman Peter Hoekstra. He's the top Republican on the House Intelligence Committee.

Congressmen, thanks for very much for coming in. And Congressman Hoekstra, I want to start with you on this mystery, this bombing that the Israelis undertook of some sort of facility in Syria. You and a handful of your colleagues have been briefed by the Bush administration what exactly happened.

And yesterday in The Wall Street Journal, you and Congresswoman Ileana Ros-Lehtinen wrote a provocative article saying, among other things, this -- and both of have you been briefed: "The Bush administration, however, has thrown an unprecedented veil of secrecy around the Israeli air strike. We are prepared to state based on what we have learned that it is critical for every member of Congress to be briefed on this incident as soon as possible."

Why is it so important, Congressman?

REP. PETER HOEKSTRA (R), MICHIGAN: What happened in northern Syria clearly can be described potentially as an act of war. I mean, you've got Israeli planes going into northern Syria and bombing some type of facility. Yes, we've been briefed.

A number of countries that may be on our radar screen, Iran, North Korea, other countries. You know, we should know what their role in this activity or what was going on in Syria. And the most important thing at this point in time, Wolf, is that, you know, the president and administration have decided that they are going to make this information public. But what they're doing is they're going through and leaking parts of this story to the media. We call that "spot declassification."

Jane and I had a discussion about this towards the end of last week. She thought maybe information should stay classified. I disagreed with her.

But I think we both would agree that if the administration is going to start leaking bits and pieces of this story to the media, at that point all members of Congress should be briefed. And I think the American people should know what has gone on.

BLITZER: Well, Congresswoman Harman, a, have you been briefed on this incident by the administration?

REP. JANE HARMAN (D), CALIFORNIA: I know what I know from the public media. And I did not know that Peter and Ileana were writing an article that was published yesterday but I have read it and I agree that selective declassification by the administration is very troublesome.

We see it all over. We see it in a piece of bogus intelligence that was circulating around the House floor when we were extending FISA in August. We see it again, something about the 10th Mountain Division in Iraq and we had a gap in coverage. I know that's not true since I was in Iraq when that was going on and I was never told there was a gap in coverage.

BLITZER: But Congresswoman, you're the chair -- you...

HARMAN: But these kinds of things, really, as far as I'm concerned, force policymakers to make bad decisions, and it is wrong.

BLITZER: But you're the chair of this important intelligence subcommittee of the House Homeland Security Committee. Have they briefed you?

HARMAN: No, they have not briefed me on what went on in northern Syria. All I know is what I've read in the media. I've had some conversations with Peter, but he's not free to reveal classified information even to me, although I have the clearances. That's just how the thing works. And we both respect that.

I just want to say about that event though, that the neighborhood has also kept quiet, which is interesting. I'm assuming there was some North Korean complicity in nascent nuclear reactors somewhere in Syria, and the Israelis and the Americans both knew about that. If the neighborhood's quiet, it means that no one has an interest in an arms race involving Syria.

BLITZER: Can you tell us, Congressman Hoekstra, if there was evidence that the Syrians working with North Korea and/or Iran were actually in the process at that facility of trying to build a nuclear bomb? HOEKSTRA: Wolf, I can't get into any of the details that we've been briefed in on. You know, that's why this spot declassification that the administration is going through is so troublesome. They can leak bits and pieces of the program. Those of us who have been briefed on the program, we can't say anything about what we know or when we knew it.

BLITZER: Because I read your article, together with Ileana Ros- Lehtinen, that you wrote in The Wall Street Journal, the impression I got, correct me if I'm wrong, you are deeply concerned about North Korea, about its commitments it's making to give up its nuclear weapons program.

You don't trust them. And as evidence, you are suggesting that what they were doing in collaboration with the Syrians potentially proliferating nuclear weaponry, if you will, that that raises alarm bells for you.

HOEKSTRA: Absolutely. I mean what we've found through the '90s and what we have found through the Bush administration is that the North Koreans, they'll always make deals but the other thing that we'll see consistently is that they will break those agreements.

And so if North Korea, or if Iran or other countries were involved in Syria, it again will be an indicator of what kind of agreement they will make and whether they would be willing to adhere to the agreements that they make in public.

BLITZER: Can you confirm, Congressman, that North Korea and Iran were involved in that facility in Syria?

HOEKSTRA: No, I cannot.

BLITZER: Because of the classification. Is that what you're saying?

HOEKSTRA: I can't confirm who or what was going on in Syria. That's exactly right, Wolf.

BLITZER: All right. Congresswoman Harman, I want you to listen to what the president said this week, some ominous words. Because the whole notion of the upshot of what he's saying raises the specter of another U.S. war. Listen to this.

(BEGIN VIDEO CLIP)

PRESIDENT GEORGE W. BUSH: If you're interested in avoiding World War III, it seems like you ought to be interested in preventing them from having the knowledge necessary to make a nuclear weapon. I take the threat of Iran with a nuclear weapon very seriously.

(END VIDEO CLIP)

BLITZER: Is that concern, the specter of World War III, the U.S. and Iran going to war over Iran's reported nuclear weapons program, is that realistic? HARMAN: Well, I think the language is very dangerous. We heard about mushroom clouds and other images before the military action in Iraq. I wish the president would avoid that.

I think that we should do everything we possibly can to prevent Iran from getting a nuclear weapon. I think we should apply our strength to their weakness. That's why I think that economic sanctions more coercive than the ones we have now are the way to go. The sanctions we have are working. There is evidence they're destabilizing the regime.

It is true that in the news the last couple days, there's a report that Larijani, who was considered a more moderate head of the nuclear program has been replaced, but our intelligence on Iran -- and I know Peter will agree with me -- is not very good. We really don't know what they're doing.

Therefore, economic sanctions, Germany has now joined France, which is much more vocal in -- both on the nuclear side and the general banking side and applying sanctions. We need to get Russia and China to be more cooperative. The U.N. is on the right page. This is the way to change the strategy in Iran, not war-mongering threats.

BLITZER: What about that, Congressman Hoekstra, the specter of World War III. Is the president's rhetoric over the top?

HOEKSTRA: Well, actually, this is a case where I probably agree a lot more with Jane's approach to this issue than I would with the president. Dealing with Iran is a very, very serious issue. You know, over the last four or five years, Jane and I have had the opportunity to travel through the Middle East, to travel to Pakistan, and we've talked about a lot of these issues.

And what we find is that as she and I have had the opportunity to talk and -- you know, not talk as Republicans or Democrats, but talk about people who are really concerned about America's security and, you know, the threat from radical Islam and the threat from places like Iran, we really can come together in a bipartisan way to address these issues.

And I encourage the speaker of the House to allow us to do that.

But I'd also encourage the president to reach out more to Congress, because when it comes to national security, really we do need to be bipartisan. The threats are too real and too big to make these political talking points.

BLITZER: All right. We're going to take a quick break, but we have a lot more to discuss with these two members of Congress. We'll discuss what's happening in Pakistan, the Iraq war strategy, a lot more.

And then a leading member of Lebanon's parliament reveals who he thinks is behind the rash of political assassinations in Lebanon. You're watching "Late Edition," the last word in Sunday talk.

(COMMERCIAL BREAK)

BLITZER: Coming up in our next hour, we're going to be speaking about where things stand in Iraq with the Iraqi government spokesman, Ali al-Dabbagh. He's here in Washington. But right now, we're continuing our conversation with two leading members of Congress, Democratic Congresswoman Jane Harman of California, and Republican Congressman Peter Hoekstra of Michigan.

Given the carnage that we saw on the streets of Karachi, Pakistan, Congresswoman Harman, this week, was it wise for the former Prime Minister Benazir Bhutto to come back?

HARMAN: Well, I'm not sure we could have predicted that her not coming back would avoid the carnage. We don't know the cause of it yet. I've heard speculation that it could be al Qaeda. She speculated that it could have been those from the regime that hanged her father.

Nonetheless, from what I read, more could have been done. She could have had jammers to prevent these IEDs from going off. And Pakistan's in for a very rough period, and so is the world.

I would predict, based on what I know, that Musharraf is in a weak point, that his election, such as it was, may not have been the best idea, doing it the way it was. And I think the U.S. would be wise -- and I trust we are doing this -- to have contingency plans in the area, especially because should he fall, there are nuclear weapons there. The tribal areas of Pakistan, which he really has no control over, are now the new staging ground or maybe the old staging ground for al Qaeda. We know that Westerners are training there. It is truly a worrisome situation.

BLITZER: Congressman Hoekstra, Pakistan, as Congresswoman Harman points out, is an Islamic country, a Muslim country. It has a nuclear arsenal. President Musharraf is in charge, but there is a strong Taliban and al Qaeda element, clearly at least in some of the western -- some of the provinces along the border with Afghanistan.

How worried should the U.S. be right now about what's happening in Pakistan?

HOEKSTRA: Oh, I think we should be very worried about what's happening in Pakistan. Not that it means that it's on a path to an imminent collapse, but Pakistan is critical in us being successful in taking out and defeating radical Islamists and al Qaeda.

You mentioned the tribal areas. You know, the tribal areas are just adjacent to Afghanistan. I was there three weeks ago. You know, there are continuing presence of al Qaeda in these ungoverned areas. It's making it more -- making it less stable in Afghanistan. You know, the plots that we have seen in the U.K., their roots come out of these tribal areas. It is the planning and the training ground for radical jihadists in their worldwide threat to the United States.

This is a real threat. We need a strong, stable government in Pakistan that is willing and able to assist us in rooting out this threat.

BLITZER: All right. Do you have confidence, Congressman Hoekstra, in the president, Pervez Musharraf, that he is doing everything he can, in cooperation with the U.S. and other Western countries, in going after al Qaeda, trying to find Osama bin Laden?

HOEKSTRA: I think that President Musharraf is doing everything that he can, but there are extreme limitations on that from the internal politics and the internal dynamics in Pakistan.

Again, three weeks ago, we met with President Musharraf in Pakistan. I think he's committed. I think he sees the threat, not only of radical jihadists to the West, but also to his own government and the stability of Pakistan. So I think he wants to do what's necessary.

BLITZER: You agree, Congresswoman Harman?

HARMAN: I am less sure of that. I think the deal that Musharraf made a year and a half ago or so with the tribal areas to let them govern themselves was a colossal strategic mistake for him, because these folks don't love him any better, I don't think, than they love us. And he puts surviving in power ahead of doing the right thing. And I think it will come back to haunt all of us.

I agree with Peter that those areas right now are probably ground zero for training terrorists around the world. We have our eye on that. We've tried to penetrate some of these plots. Our intelligence community is doing pretty well.

But I visited the tribal area, too, and you can see how easy it is to hide out. And the fact that we have not caught Osama bin Laden and Zawahiri six years after 9/11 means two things -- one, it means we took our eye off the ball and got bogged down in Iraq, but number two, it means that Musharraf has been a very crafty fellow, and has not protected them particularly, but protected himself in a way that made it very hard for us to get the job done.

BLITZER: President Bush really went after the Democratic leadership in Congress this week. He ridiculed, Congresswoman Harman, what the speaker is doing, what the Senate Majority Leader Harry Reid is doing. I want you to listen to this little -- these excerpts of what he told a news conference earlier in the week.

(BEGIN VIDEO CLIP)

BUSH: Congress has work to do on health care. Congress has work to do to keep our people safe. Congress has work to do on the budget.

With all these pressing responsibilities, one thing Congress should not be doing is sorting out the historical record of the Ottoman Empire.

(END VIDEO CLIP)

BLITZER: He was referring to a resolution that the speaker wanted passed in the House of Representatives, a resolution condemning the Ottoman Turks for what's called genocide of the Armenians back during World War I.

Is the president right, that this is simply a waste of time and recklessly potentially endangers U.S. relations with a NATO ally, Turkey?

HARMAN: Well, I'm a co-sponsor of that resolution, and I believe from the study I've done that there was genocide. I also have learned recently that the U.S. government at the time sent millions of dollars in aid to try to prevent the collapse of Armenia, which is a good thing.

But I am one of the people who asked the Foreign Affairs Committee a few weeks back not to report the resolution, and I said that if it came up on the House floor, I would oppose it now because of the timing.

I think the timing is simply dreadful. I visited Turkey recently, met with its leaders, but also the Armenian population inside Turkey. And, yes, I agree that -- and I think -- I'm not sure what will happen. I agree that this is the wrong timing.

Let me just add one thing -- the Armenian community in California is huge, they're passionate. I applaud that. However, they have called me a Holocaust denier. They may have called others that, too. But as one whose father's family was decimated in the Holocaust, that's pretty up close and personal for me, and I don't think this is about whether we're denying the Holocaust. I think this is about the timing of a vote in Congress.

This would be the third time the House has voted on this issue.

It voted on it in 1975 and 1984. This is not the right time to be voting on it.

BLITZER: Congresswoman Harman, Congressman Hoekstra, we got to unfortunately leave it there. We're out of time. But thanks to both of you for joining us.

HOEKSTRA: Thank you.

BLITZER: And coming up next...

(BEGIN VIDEO CLIP)

JUMBLATT: This tyrant, this butcher.

(END VIDEO CLIP)

BLITZER: You're going to find out...

(BEGIN VIDEO CLIP)

BLITZER: Walid Jumblatt, thanks very much for coming in. Welcome to the United States. (END VIDEO CLIP)

BLITZER: ... talking about. That's coming up.

And later, the former world chess champion Garry Kasparov does not have any kind words for his country's president, Vladimir Putin. My interview with Kasparov, that's coming up as well. "Late Edition" will continue right after this.

(COMMERCIAL BREAK)

BLITZER: Welcome back to "Late Edition." I'm Wolf Blitzer in Washington. It's an extremely dangerous time for politicians in Lebanon.

There have been a series of high-profile political assassinations, with many Lebanese blaming Syria's president, Bashar al-Assad and his regime in Damascus. Walid Jumblatt is a leading member of the Lebanese parliament. He's a very harsh critic of Syria.

I spoke with him here in Washington this week.

(BEGIN VIDEOTAPE)

BLITZER: Walid Jumblatt, thanks very much for coming in. Welcome to the United States.

JUMBLATT: Thank you.

BLITZER: Will there be free and fair elections in Lebanon coming up?

JUMBLATT: I hope so. But free and fair, that is not the word, because we are ahead of a crucial three weeks, and our opponents, although they are members of parliament, they have other methods to deal with us.

BLITZER: You are referring to the assassinations...

JUMBLATT: The assassinations.

BLITZER: ... the whole series over the past two years. Let me get this question out before we even move on and talk about the politics. How worried are you about you? Because you've been outspoken, as our viewers around the world know.

JUMBLATT: Three weeks ago, we lost a partner from the parliament. A member of parliament was killed. And we were 69 as a majority. We are now 68. They can kill four more of us and we will be reduced as a majority. We won't be able to vote for a free president, a president that will abide by international law and resolutions.

BLITZER: So you obviously have good security.

JUMBLATT: Good security, it's impossible to have it in Lebanon. We are hiding in our homes. The members of parliament, most of them now are in an annex of a hotel, Hotel Phoenicia. They are not even able to open the windows because of possible sniping. But we have to go along.

BLITZER: Who's behind these assassinations?

JUMBLATT: I think Syria and its ally, Hezbollah.

BLITZER: You have no doubt about it?

JUMBLATT: I have no doubt. But the problem is, I mean, how to fix up the tribunal. We are waiting for the (inaudible) tribunal, which has been fixed up for the assassinations, the late Prime Minister Hariri and others. The tribunal is an international. It will give its verdict maybe next year. I hope so.

But until next year is quite a long time. So anything can happen.

BLITZER: So you're here in Washington. You have been seeking, what, U.S., international, United Nations support for these elections in Lebanon and for a future of Lebanon that's at peace?

JUMBLATT: Yes. But at the same time I'm telling the people here and everywhere as long Bashar al-Assad in Syria feels...

BLITZER: The president.

JUMBLATT: Yes. Feels secure, as long as there are no sanctions, effective sanctions against him, military sanctions or economic sanctions, well, he will just go along in Lebanon killing us one by one.

BLITZER: The president of Lebanon, Emile Lahoud, said this the other day, and it seemed to be criticism of U.S. -- any U.S. role, U.S. help for you and others in Lebanon: "Interference by international parties," he said, "could instigate hatred and increase tension in the Lebanese scene, a thing which not only might have negative repercussions on upcoming presidential elections, but on the safety of the Lebanese as well."

You reject that criticism from President Lahoud.

JUMBLATT: Well, we've got -- thanks to the American help and international help, we have got international resolutions. Our opponents -- our so-called partners in parliament, they have a private army in Lebanon. They have private security. They have weapons provided by the Syrian regime and from the -- from Tehran.

So this is the slight difference between us and them. We have international resolutions. We are not asking for military help. We are not asking for military bases in Lebanon. They have already a base in Lebanon, Iranian-Syrian base.

And they are behind assassinations. So...

BLITZER: And you believe that President Lahoud is part of that Iranian-Syrian-Hezbollah alliance?

JUMBLATT: When we dared in 2004 to say no to the renewal of the mandate of Lahoud, started the killings. It was in 2004. And 2005 was the major killing, the killing -- assassination of Prime Minister Hariri.

So he is just a puppet of the Syrians and the Iranians.

BLITZER: You are referring to the prime minister, Rafik Hariri, who was assassinated. His son, Saad Hariri, a member of the Lebanese parliament, said this the other day: "There is a killing machine that has started killing the majority, and it has not stopped. We believe that somehow that the Syrian regime will stop the elections from happening. Do you agree with him?

JUMBLATT: Yes, I do agree. This is why we've got to stay alive, survive the next few weeks. And then if we are still a majority, we can elect one of us president that will abide by international law and also abide by the international tribunal of justice, that will one day, I hope, bring the murderers, bring Bashar al-Assad to trial.

BLITZER: The Syrian president, Bashar al-Assad, denies that Syria had anything to do with any of these assassinations, including the October 2nd. He says this: "Of course we have influence. This is normal. But having influence is different from committing crimes in Lebanon. This is not in our interest. What did we get from killing those people? That is the question that we have to ask."

Do you believe him when he denies any Syrian involvement in these assassinations?

JUMBLATT: Bashar al-Assad is the son of Hafez al-Assad, the one who killed my father. So they have quite -- have records, the Syrians, in killing opponents. My father was killed in 1977. Unfortunately at that time Lebanon was divided. I was obliged to fix a deal with the devil, with Hafez al-Assad, because Lebanon was divided.

So I know the family. I know the regime. So he cannot deny having nothing to do with crimes in Lebanon.

BLITZER: So you made a deal with Hafez al-Assad even though you believe he was responsible for killing your father?

JUMBLATT: I was obliged. I was obliged because Lebanon was divided. Now Lebanon is united, but the allies of Syria are not with us. They are supporting the regime of Syria, supporting the regime of murderers. We can do nothing.

BLITZER: Hassan Nasrallah, who's the leader of the Hezbollah in Lebanon, he blames Israel for all of these problems. He says: "The hand that is killing is Israel's. Israel has a sure interest in the assassinations because it is the prime beneficiary of any internal strife in Lebanon."

JUMBLATT: That's the biggest joke that I have ever heard. It seems the Israelis are killing in Lebanon the anti-Syrian people or personalities, as if the Syrians are hiring the Israelis to kill us. It's really a joke.

I mean, we oppose Syrian domination. We oppose Syrian occupation. I don't see why the Israelis should kill us.

BLITZER: So you reject what Hassan Nasrallah is saying, that Israel is responsible for all of this?

JUMBLATT: Of course not.

BLITZER: Hezbollah is making a comeback after the war last summer. This is from an Associated Press report from Beirut: "More than a year later, Hezbollah appears to again be solidly entrenched across Lebanon's south, looking, in fact, as if its fighters never really left, but merely went underground. The Shiite militia's banners hang everywhere, boasting of the divine victory over Israel, and thanking its chief sponsor, Shiite majority Iran, for helping with post-war reconstruction. Villages report the militia's recruitment of young men is booming, and its popularity is firm."

How popular, how significant is Hezbollah in Lebanon right now?

JUMBLATT: They are popular. They are getting a lot of help from Iran through the Syrian regime, a lot of money, a lot of weapons. We want Lebanon to be independent. We want Lebanon to be out of the Israeli-Arab conflict.

This is why the Lebanese-Syrian border should be secured by the army -- our army, and by international observers. Without that, Lebanon will be just a base to launch more hostilities against Israel and reprisals from the Israelis.

BLITZER: Under pressure, though, the Syrians did withdraw their military forces from Lebanon. They had been there for decades. But they did pull those out. Are they completely out or are there still Syrian military and/or intelligence officials in Lebanon?

JUMBLATT: They don't need to have Syrian military or intelligence. Maybe they have intelligence. But they have their unofficial brigade in Lebanon -- or division, which is the Hezbollah, part of the Revolutionary Guards of Tehran.

So this alliance between Iran, Syria, and Lebanon, Hezbollah, is an indirect occupation of Lebanon.

BLITZER: There has been a lot of speculation about this Israeli air strike on some sort of facility in Syria in September. The New York Times reported this week, "Israel's air attack on Syria last month was directed against the site that Israeli and American intelligence analysts judge was a partly constructed nuclear reactor, apparently modeled on one North Korea has used to create its stockpile of nuclear weapons fuel."

What do you know about this? JUMBLATT: We've heard nothing. I mean, the Israelis deny it and the Syrians deny it. I have no idea. I just have no idea. But it is possible that, well, somewhere the Syrians, through the Iranians, are trying to buy or to acquire some, let's say, nuclear technology or nuclear devices. Everything is possible.

BLITZER: What is the most important thing that you would like to see the United States do to help Lebanon?

JUMBLATT: Look, as long as we have this tyrant, this butcher in Damascus alive, we won't be able to have a democracy, a stable democracy in Lebanon. We won't be able to have an independent and free Lebanon. So this is where I'm asking and I have asked for effective sanctions against this guy, this regime in Damascus.

BLITZER: What kind of sanctions? What more do you want the U.S. to do?

JUMBLATT: Up until now, nothing has been done. It has been, of course, U.S. provided us with international resolutions and helped us with the tribunal. But this guy was afraid in 2005 when President Bush and Jacques Chirac and the international community ordered him out of Lebanon.

Now he is no more afraid. Now he should be afraid again by sanctions. What kind of sanctions? I don't know. I think people here know what kind of sanctions.

BLITZER: Walid Jumblatt, the Lebanese parliamentarian, good luck to you. Good luck to all of the people in Lebanon. Be careful over there.

JUMBLATT: Thank you.

(END VIDEOTAPE)

BLITZER: And coming up...

(BEGIN VIDEO CLIP)

BLITZER: Your security may be endangered as well. How worried are you?

GARRY KASPAROV, COMMITTEE 2008: I'm very worried, but I don't have any other choice.

(END VIDEO CLIP)

BLITZER: Garry Kasparov tells us why he fears for his life as he runs for the Russian presidency. My conversation with him, that's coming up next. And later, did any Republican presidential candidate win over conservative voters this weekend? We'll talk about that and a lot more with three of the best political team on television. "Late Edition" continues right after this.

(COMMERCIAL BREAK) BLITZER: He's a chess grand master and a former world chess champion. But Garry Kasparov is trading in the chessboard for politics, hoping to become Russia's next president.

He's also the author of a new book entitled, "How Life Imitates Chess: Making the Right Moves from the Board to the Boardroom." I spoke with him just a short while ago.

(BEGIN VIDEOTAPE)

BLITZER: Garry Kasparov, thanks very much for joining us. How serious are you about running for president?

KASPAROV: In Russia we are not fighting win elections, we are fighting to have elections. And I think running for president is more of a statement, which is very important at a time when people do not see an alternative.

BLITZER: So basically you just want to make a statement. You recognize you really don't have much of a chance of actually winning the election? The elections are what, next March?

KASPAROV: Yes, the election -- presidential election is next March. But as in America you have problems for third-party candidates to be registered. In Russia, we have the same problems with a second- party candidate.

So that's why for us it is very important to be part of the game, and to make sure that the Kremlin cannot stage elections and present it to the world as something democratic.

BLITZER: A former Soviet spokesman, Vladimir Posner, a Russian television host, said this on "60 Minutes" the other day, he said: "Everyone knows that he was a great chess player, but today they know him as a fringe, as they would say, political figure, and he could not be elected dog catcher."

Those are pretty strong words from Posner.

KASPAROV: These are absolutely very strong words. Mr. Posner had to add that if I could have a chance to be on TV programs like his, in two or three weeks the situation would change completely.

But because people like him do not want to confront regime and play like, you know, Kremlin stooges, then our chances, of course, are highly limited.

BLITZER: What is your basic issue with the current president of Russia?

KASPAROV: Russia is a police state. It is some sort of soft version of one-party dictatorship. It's presented as a big economic success, as a stability, but underneath, it's a volcano which in my view is about to erupt.

It's a growing gap with rich and poor. It's a collapsing infrastructure. It's a looming potentially banking crisis and ongoing political crisis because there is no stable political system to govern the country.

BLITZER: David Remnick wrote an article about you in The New Yorker magazine, the October 1st issue. I'm going to read a sentence because it jumped out at me when I read that article: "Kasparov, like many others in opposition, is convinced that Putin became a billionaire in office, perhaps the richest man in the country, and has entrusted Russian confederates to shelter his money in foreign banks."

First of all, do you believe that?

KASPAROV: Absolutely. I think we'll find out more when Putin is not in power. That will be one of the worst stories about dictatorships looting and robbing the country. Obviously it will take time.

But when you look at the list of Russia billionaires -- and that's the now second country in the world, ahead of Germany and Japan, just behind the United States, you'll find out that we already have dozens of billionaires. And Putin can imprison all of them in 24 hours.

Do we think that he is poor?

BLITZER: Well, what evidence -- besides your suspicion, but is there any hard evidence that he's stolen billions of Russian dollars?

KASPAROV: Look, Wolf, his cronies are in charge of the most lucrative business in Russia. His closest friends that work with him since the late '80s, and now they are "taking care," quote-unquote, of the most valuable businesses in oil, gas, and other energy sectors. They all are billionaires and that's not a big secret.

Now how about him? He is still poor?

BLITZER: Well, that is the question that...

(CROSSTALK)

KASPAROV: Absolutely. Don't worry, the independent -- independent justice in Russia will investigate it when the time comes.

BLITZER: But you are saying he has bank accounts -- Swiss bank accounts or all sorts of secret holdings, is that what you are suggesting?

KASPAROV: Look, you know, we -- what we know, for instance, that there is a mysterious owner of 37 (ph) percent of Surgutneftegaz, which is roughly worth $20 billion at the current market value. And these shares disappeared at the end of the last year from Russian registration, somewhere in the tax havens.

And there are many other similar occasions that might lead only to one person who is in charge. But again, his friends are splitting the country's national budget. They are in control of Gazprom, Rosneft, and the largest so- called state-run corporations.

BLITZER: Well, Russia is clearly making a lot of money now exporting oil with oil at $90 a barrel.

KASPAROV: It is not -- it is not Russia, there are people who are in charge. As we say in Russia, it is a bizarre combination of Karl Marx and Adam Smith. Expenses nationalized and profits privatized.

BLITZER: There is another side of the story. Let me read to you what Alexandr Solzhenitsyn told Der Spiegel back in July. He said: "Putin inherited a ransacked and bewildered country with a poor and demoralized people, and he started to do what was possible, a slow and gradual restoration." Here are some statistics that have come out recently. The Russian economy, the gross domestic product is now up 7.7 percent, real incomes up 14.4 percent, 600,000 new jobs. And this poll that came out from the Russian Public Opinion Research Center asked about approval or disapproval of President Putin's job rating -- 83 percent in this poll said they approve of the job he is doing; 10 percent disapprove.

Those are pretty amazing numbers.

KASPAROV: Look, you know, I don't think that we can trust opinion polls taken in a police state. People obviously are scared to answer the question about Putin or their governor. The moment you ask the same people about economy, about social security, health care, other important issues -- issues important for them, you can get a very, very different number.

Now as for Russian GDP and all other average statistics, yes, you are absolutely right. But the problem is that the country is divided into uneven parts. Fifteen percent that are living in the country you just described, and 85 percent, which is 120 million people, they are not seeing all of these benefits.

And for instance, in Moscow, which is declared by Financial Times the most expensive city for foreigners, the average income, official statistics, is just slightly over $1,000.

BLITZER: President Bush was asked the other day about his conversations with Putin, about who would succeed Putin, what is next in Russia. Listen to what President Bush said.

(BEGIN VIDEO CLIP)

BUSH: I tried to get it out of him, who is going to be his successor, what he intends to. And he was wily. He wouldn't tip his hand.

(END VIDEO CLIP)

BLITZER: Now, there is some suggestion that he has got to give up his presidency, but he might run as prime minister, in effect, have a figurehead as president where he as prime minister would really run the country.

Is that your suspicion?

KASPAROV: No. I don't think Putin will be prime minister because he said it. Now, if you look at Putin's record, everything he promised or indicated, didn't happen. So that's why I think he is trying to stay in power, no doubt about it, but he will be looking for more of the model of spiritual leader. For instance, Ayatollah Khomeini in Iran, and his probably latest visit to Tehran was one of the steps to figure out how to do it.

I don't think that the prime minister could fit Putin's aspirations, because it is a subordinate position. And in Russia, it is too dangerous to create two alternative sources of power.

So I guess it will be Putin's rule based on his mandate that he wants to receive from the parliamentary elections when he is head of the party list of the United Russia, which is the current analogue of the Communist Party.

BLITZER: You are emerging as an outspoken opposition critic of the president of the regime in Russia right now. How worried are you about this? And I ask the question in light of some incidents that have occurred -- tragic incidents in the past year or so. And I will put them up on the screen. Look at this -- Alexander Litvinenko killed; Anna Politkovskaya killed, a Russian journalist; Mikhail Khodorkovsky in a Siberian prison. He was an oligarch, a billionaire.

There are some who have suggested that your security may be endangered as well. How worried are you?

KASPAROV: I'm very worried, but I don't have any other choice. If I want to be one of the opposition leaders, I have to share the same risks as thousands of activists across the country that cannot even rely on the protection of the famous name, or they do not have financial abilities to hire security and to organize some minimal protection.

BLITZER: So you have good security when you are campaigning, when you are out on the streets in Russia?

KASPAROV: What I mean, good security, yes, I can be protected against hooligans or against spontaneous attacks. If the state wants to go after me or after anybody else, I don't think we have much to say.

I can minimize the risk. I cannot eliminate it, because I understand we are dealing with a regime that has no allergy to blood.

BLITZER: Your book, "How Life Imitates Chess," has a lot of practical examples for people to learn on how to deal with a crisis, how to deal with challenges, how to deal with opportunities. What is the single most important example you can give us that you are learning right now as you make the transition from a chess world champion to a politician struggling to change his country?

KASPAROV: There are two things I want to say now. One is that we always must stay objective. If position demands us to attack, we must do it; if position demands us to stay quiet and to defend, we must do it. So it is very important not to overestimate or underestimate your chances.

But as a professional player, I always preferred to be on the aggressive side. So that is why for those who have this opportunity, I would recommend to go on the attack, because the odds are in favor of those who are taking risks.

So it is about courage to take risk, courage to fail. That is what many people are trying to avoid. And when I hear, for instance, at a political debate in the United States, I'm surprised that the to- be leaders of this country, are trying to avoid the most important issues.

BLITZER: Garry Kasparov, good look to you. Thanks very much for joining us. The book is entitled "How Life Imitates Chess: Making the Right Moves from the Board to the Boardroom."

Garry Kasparov, thanks.

KASPAROV: Thank you very much for inviting me.

(END VIDEOTAPE)

BLITZER: And coming up next, the actor Richard Gere tells us why he thinks China is acting childish, his word.

And later this week, don't miss CNN's groundbreaking "Planet in Peril" series. The two-days special airs Tuesday and Wednesday at 9:00 p.m. Eastern, a special you will see only here on CNN.

"Late Edition" will be right back.

(COMMERCIAL BREAK)

BLITZER: Welcome back to "Late Edition." I'm Wolf Blitzer in Washington. President Bush and the United States Congress angered China this week with a ceremony honoring the Dalai Lama, the Nobel Peace Prize-winning spiritual leader of Tibet who was exiled back in 1959.

Among those in attendance was the actor Richard Gere. I spoke with Richard Gere in "The Situation Room."

(BEGIN VIDEOTAPE)

BLITZER: Why, first of all, are you as passionate as you are in trying to support a free Tibet and the Dalai Lama?

RICHARD GERE, ACTOR: Well, clearly, this is people who deserve their freedom. And as his holiness says, he's looking for meaningful autonomy so that their religion and culture can survive. And the onslaught of the Han Chinese and the communist Chinese government and policies has been destroying them now since 1959.

BLITZER: Were you surprised at how effusive, how open the president was today in his public remarks? And in the way he actually dealt with the Dalai Lama. Because, you know, presidents often meet with the Dalai Lama, but it's usually behind doors. No pictures, no nothing.

GERE: Well, you know, actually, the first president to be photographed openly with his holiness was his father, was the first Bush. And, look, this president I have a lot of problems with, but in terms of Tibet and HIV/AIDS, you know, he's done extraordinary things.

BLITZER: What about the Chinese government's reaction? Because they're saying all these things, that they're not happy about this, that there will be consequences. What do you think?

GERE: Well, it's kind of childish. I mean, they're using these kind of old-form characterizations. He's a splittist, he's, you know, these kind of childish remarks.

BLITZER: But he's not calling for an independent Tibet. He's saying it should be part of China but should have autonomy.

GERE: The autonomy is meaningful autonomy in terms of religion and culture. You have to understand this is a vast area we're talking about. Tibet is the size of western Europe. And it's a very delicate ecological place. The Han Chinese have now, the Chinese government, the communist government, has brought in over 6 million Chinese settlers, many of them subsidized. And they're...

BLITZER: To try to change the demographics.

GERE: Oh, absolutely. You know, they've done this elsewhere...

BLITZER: What should the U.S...

GERE: ... all over what is now China.

BLITZER: What do you want the U.S. government -- the Congress, the executive branch, what do you want the U.S. to do?

GERE: First, what they're doing now. In harmony, all parts of our government have said, yes, this cause is just. It's not political, it's human. It's in the area of human rights and civil rights. And the will of, and the need, the desire, the right of all of us to practice religion, to practice our own culture in a way. The riches of China, the riches of the world demand that we do this.

BLITZER: How do you get the Chinese to change? For example, there's the Beijing Olympic games coming up this summer. Where do you stand? Because some are saying maybe it's time to think about a boycott.

GERE: Boycott's difficult to me. I don't believe in isolation. I believe in speaking the truth and speaking the truth loudly in every instance. And I must say, our State Department and our executive branch has been doing that.

I think forcing strongly -- and if you'd rather say suggest strongly the meeting between the Dalai Lama and the leaders Hu Jintao in China around the Olympics would be great for Hu Jintao. It would be great for China.

They have huge problems in that country dealing with the rest of the world. Human-rights abuses are well documented. Abuse of our own people and minorities is well documented. To create a positive situation with the Dalai Lama -- and this is all resolvable. These are not huge issues we're talking about. It's freedom of religion, freedom of development of culture.

BLITZER: Richard Gere, thanks for coming in to Washington. Thanks for coming in to "The Situation Room."

GERE: Thank you.

(END VIDEOTAPE)

BLITZER: Still ahead, the Iraqi government spokesman, Ali al- Dabbagh. He discusses whether his country can head off a troop incursion by Turkey. He's standing by live.

Plus, World Bank President Robert Zoellick weighs in on the economic outlook of the developing world and the possibility the U.S. recession. "Late Edition" continues after this.

(COMMERCIAL BREAK)

BLITZER: There's much more ahead on "Late Edition," including whether Iraqi leaders are any closer to reaching key political goals.

Plus, Hillary Clinton's widening lead in the polls. Is she a lock for the Democratic presidential nomination? "Late Edition" continues at the top of the hour.

(COMMERCIAL BREAK)

BLITZER: This is "Late Edition," the last word in Sunday talk.

Iraq in the crossfire.

(BEGIN VIDEO CLIP)

BUSH: We are making it very clear to Turkey that we don't think it is in their interest to send troops into Iraq.

(END VIDEO CLIP)

BLITZER: We will talk with Iraqi government spokesman, Ali al- Dabbagh.

Sky-high oil prices.

(BEGIN VIDEO CLIP) ZOELLICK: It's a benefit for some, but it puts a real strain on others.

BLITZER: World Bank President Robert Zoellick assesses the impact on the U.S. and the world economy.

Republican presidential frontrunner Rudy Giuliani reaches out to skeptical conservative voters, while Hillary Clinton rides high in the polls.

Insight on the race for the White House and more from three of the best political team on television. This second our of "Late Edition" begins right now.

Welcome back to the second hour of "Late Edition." We will get to our interview with the Iraqi government spokesman, Ali al-Dabbagh, in just a moment. First, though, let's go to Baghdad. That's where CNN's Nic Robertson is standing by. He's following the latest violence along the border between Iraq and Turkey. A very, very worrisome development, Nic. What is the latest?

NIC ROBERTSON, CNN CORRESPONDENT: The latest is that 12 Turkish soldiers have been killed, 17 wounded, in what Turkish officials are describing essentially as an ambush by the PKK, Kurdish fighter they call -- the United States as well -- calls terrorists. According to Turkish officials, the PKK had put explosives under a bridge. When a Turkish army convoy drove over the bridge, they detonated the explosives.

There are still Turkish troops missing. And not long after that, a civilian bus, a bus carrying people going to a wedding was hit by a mine again. Turkish officials saying that was a PKK attack targeting these civilians, 12 people wounded there.

But we've heard very strong language coming from Kurdish officials today. The president of the Kurdish region, Massoud Barzani, the president of Iraq, also a Kurd, Jalal Talabani, telling the PKK, who are essentially fighting for exactly the same thing the Kurds have fought for all these years, which is independence, telling them that they must lay down their weapons. But also sending a strong message to Turkey, that Turkey must deal with the PKK and with its issue through dialogue. If they try and invade and come into Iraq, the Kurdish regional president saying they, the Kurds, will stand up and fight the Turks -- Wolf.

BLITZER: And what happened in Sadr City today, in Baghdad? Because clearly, that's a source of significant tension as well.

ROBERTSON: It is. There was a large U.S. military-led operation in Sadr City. They were chasing down what they said was a leader of an Iranian-backed kidnap group operating in Sadr City. The U.S. military went in with forces. They were attacked as they were leaving. They called in air support.

According to the U.S. military, some more than 40 people associated with this kidnapping group, criminals, were killed in this attack. Now, according to police sources and the Interior Ministry here and the mayor of Sadr City, they say civilians were killed. The U.S. military says it is not aware of any civilians being killed, according to the Interior Ministry. Fifteen civilians were killed in that attack. Many more wounded, they say -- Wolf?

BLITZER: Nic Robertson on the scene for us in Baghdad. Nic, thanks very much.

Let's get some immediate reaction to both of these developments. Joining us here in Washington is the spokesman for the Iraqi government, Ali al-Dabbagh. Thanks very much for coming in.

Let's talk, first of all, about Turkey. How worried are you that this situation along the border between your country, Iraq, and Turkey is going to explode into all-out warfare?

ALI AL-DABBAGH, IRAQI GOVT. SPOKESMAN: Again, Wolf, we are asking the Turkish leader not to take any -- not to react in this way, because there would be a sequence of not good results for Turkey and Iraq, definitely. Let allow for the dialogue between Iraq through the bilateral arrangements, the minister of defense going to meet them in Ankara, and definitely we are committed and we are liable to take any step which we had agreed upon in the joint committees.

BLITZER: The president of Turkey, Abdullah Gul, he said this on Wednesday. He said: "Terrorism cannot be presented as excusable in any way, and Turkey will obviously take any measure to stop these heinous attacks."

You can't blame the Turkish government if PKK rebels are crossing the border from northern Iraq, Kurdistan, into Turkey, killing Turkish soldiers, they have got to do something about that.

AL-DABBAGH: They are against Iraq even. We do recognize those -- they are a terrorist organization, and we are ready to take any steps, which is within our capacity, but...

(CROSSTALK)

BLITZER: The Turkish government says the Iraqi government, especially the Kurds in the north, they are not doing enough to stop the PKK.

AL-DABBAGH: We can't stop it. Even Turkey, they can't stop the PKK. This is mountainous, rough area. Fifteen years now, the struggle with Turkey. Twenty-four times Turkey had to cross the border and could not get rid of the PKK. Now, one more crossing the border won't solve the problem. It will be great problems for all of us.

We are urging Turkey not to take such a step. Again, this is the sovereignty of the country. They can't do it by a one-sided step. It should be through arrangements.

BLITZER: But what happens -- there are thousands, maybe tens of thousands of Turkish troops massed along the border with Iraq right now. What happens if they cross the line, they go into Iraq? You say there could be a chain of events that would occur. What would happen?

AL-DABBAGH: Well, definitely, we are not in a position to confront with this military. We don't have that capacity. But definitely, this won't help in having good relations with Iraq. This is, again, international, all community, they had object. The United States had object, the European community had object, and this is going to create not good relation with Turkey.

BLITZER: Do you regard the PKK, this Kurdish separatist group that goes into Turkey and goes after Turkish soldiers, do you, as the spokesman for the Iraqi government, regard them as terrorists?

AL-DABBAGH: We had declared that clearly. They are a terrorist organization, threatening Iraq and threatening Turkey as well.

BLITZER: Are the Kurds in the north, Iraqi Kurds, doing enough to deal with the PKK?

AL-DABBAGH: I think the KRG (ph), they are committed what government of Iraq, what the central government had committed, and this is in the constitution, and they are liable to respect the constitution that no shelter will be provided for such organizations that threat Turkey.

BLITZER: The president of Syria, Bashar al-Assad, he said this on Wednesday, and it got some outrage from Jalal Talabani, the president of Iraq. He said -- "We understand that such an operation would be aimed toward a certain group which attacks Turkish soldiers. We support decisions that Turkey has on its agenda. We are backing them."

Now, Jalal Talabani, the president of Iraq, who himself is a Kurd, said this has crossed the red line, and that Bashar al-Assad should not be making these kinds of statements. Are you willing to go that far?

AL-DABBAGH: Definitely. That Bashar al-Assad or anybody else is not entitled to allow any foreign troops to cross the border and come to Iraq. This is, again, the sovereignty of the country. We do support Turkey to whatever steps being taken against PKK in their border, in their country, in Turkey. But crossing the border I think is an offensive step.

BLITZER: And let me get your reaction, because I know you've been on the phone with high-ranking Iraqi officials back in Baghdad. Nic Robertson just reported on this latest incident, this firefight that's going on in Sadr City, which has been a hot bed of Muqtada al- Sadr's supporters over there, U.S. forces going in, and according to some killing civilians there. What's going on based on the information you have?

AL-DABBAGH: There's a great tension in the Iraqi government. Just now a meeting, security meeting being over, with the prime minister and General Petraeus, and they had clearly mentioned that this excessive force in this way...

BLITZER: Excessive force by who?

AL-DABBAGH: By the American, by multinational forces, used against the civilian, it is not creating a good atmosphere. We have today, again, one more problem created, you know, it's a sequence of an attack last month in Jizani (ph), nearby neighborhood of Diyala, and the people uprising today and they are creating problem. You can't get, you know, killing the civilians in this way.

I do understand that a lot of people violating our law, and then there are criminals, but not use the power in this way. There should be an arrangement with the Iraqi government.

BLITZER: Let me just be clear. You're saying that the prime minister, Nouri al-Maliki, has just met with General David Petraeus...

AL-DABBAGH: Yes.

BLITZER: ... the U.S. military commander in Iraq, and he protested what the U.S. military did in Sadr City, is that what you're saying?

AL-DABBAGH: Yes. Yes. And then they are making a measure now, a joint committee, that whenever such thing happens, there should be an arrangement with the Iraqi government in order to -- not to have any excessive force, not to kill any civilian, not to create such tension. There's a tension in the parliament today, and it is for the first time now there is a great anger in the country in Baghdad against killing such civilians, 49 civilians being killed until now.

BLITZER: I interviewed last week the head of Blackwater, the company that has these private security contractors that protect thousands of American diplomats and other U.S. citizens in Iraq right now, Erik Prince. Listen to what he said.

(BEGIN VIDEO CLIP)

ERIK PRINCE, CEO, BLACKWATER USA: There was no deliberate murder, deliberate violence by our guys. They have done 16,500 personal security detail-type missions just like this one on September 16th, 16,500 since 2005. Less than 1 percent resulted in any discharge of a firearm by our people.

(END VIDEO CLIP)

BLITZER: What do you want the U.S. to do with these private American security contractors like Blackwater, given the incident that occurred early last month, in which, what, 17 Iraqi civilians were killed under disputed circumstances?

AL-DABBAGH: We do need Blackwater should be out of Iraq. This is first.

BLITZER: All of Blackwater?

AL-DABBAGH: I mean, at the end, they should subject to justice. There is a crime now, and people are killed unnecessarily. And then definitely, we don't want any security company to leave, definitely. But we do need them to subject to certain rules and standards.

BLITZER: I'm a little confused. Do you want Blackwater to leave the country or not leave the country?

AL-DABBAGH: We are not forcing them to leave, but there is anger involved, an anger against them. There's a tension against them. They should be subjected to justice, to accountability. They cannot...

BLITZER: So you want the private American security contractors -- and there are thousands of them -- to be subject to Iraqi civilian law.

AL-DABBAGH: Whether Iraqi or Americans. Now, I do understand Blackwater got a special case because they are connected with the State Department, with the Pentagon. They are with the full extension of forces, multinational forces. But we have to implement a rule. No country in the world allows a security company to move in the country in this way, what we have in Iraq.

BLITZER: In the meantime, though, until this dispute over this incident is resolved, can Blackwater security guards operate in Iraq?

AL-DABBAGH: We are waiting the final report of this joint committee, and accordingly, the measure will be taken whether to allow them to operate in Iraq or should be banded.

BLITZER: Ali Al-Dabbagh, thanks very much for coming in.

AL-DABBAGH: Thank you.

BLITZER: Up next, the World Bank President Robert Zoellick tells us if record-high oil prices will hurt the world economy.

And later, are conservatives ready for a third-party candidate if Rudy Giuliani becomes the Republican nominee? Insight from three of the best political team on television. "Late Edition" continues right after this.

(COMMERCIAL BREAK)

BLITZER: Welcome back to "Late Edition." I'm Wolf Blitzer in Washington. When Robert Zoellick became president of the World Bank three months ago, his first task was to smooth over tensions created by the former president, Paul Wolfowitz.

So far, Zoellick has been getting some good marks from his staff, but he still has a huge job head of him. Earlier this week, I went over to the World Bank and spoke to him about some of the major challenges facing the bank, just as the annual World Bank IMF meetings were getting under way here in Washington.

(BEGIN VIDEOTAPE)

BLITZER: Mr. Zoellick, thanks very much for joining us.

ZOELLICK: Pleased to be here. BLITZER: You've got a tough job. Let's get right to it. First of all, the U.S. economy. So much of the world economy depends on what is happening in the United States right now. How worried are you about a possible recession in the United States?

ZOELLICK: Well, you know, I follow the comments by Secretary Paulson and Ben Bernanke, who obviously watch this much closely than I do, where I think we are in a situation where there will be some slowdown in the United States.

There's still some uncertainty because of the housing sector and going through the credit repricing, the degree of it. Now, for my interest with the developing world, the United States still remains a vital engine of growth. And so that is something we try to watch closely.

But it's also interesting to see that over the past couple of months, you've seen a continuation of growth in many of the developing countries. So while I don't think you have a decoupling that some people talk about, you do see some second (ph) sources of growth, which is a good thing.

BLITZER: Here's what Ben Bernanke, the chairman of the Federal Reserve, said the other day. He said: "The further contraction in housing" here in the United States "is likely to be a significant drag on growth in the current quarter and through early next year."

And the treasury secretary, Henry Paulson, said: "The housing decline is still unfolding, and I view it as the most significant current risk to the economy. The longer housing prices remain stagnant or fall, the greater the penalty to our future economic growth."

So, what you're suggesting, even though there is not necessarily a direct spillover completely on the world economy, you still acknowledge it does have a huge impact on your work, what the economic situation in the United States is.

ZOELLICK: It could. It depends on how much the slowdown becomes -- if it becomes more serious. But what's interesting, you know, in the financial problems of the summer, in contrast with past periods, was you didn't see the big increase in interest rates, or spreads as people call it, in the developing world.

You saw some increase, but it's started to come back down. So there's something interesting happening out there, and I think it's part of the phenomenon of globalization that I work with, where you're now getting different sources of growth that will be important for the stability of the world economy.

BLITZER: So when I hear you saying, in the old days they used to say what -- something along the lines when the United States had a cold or sneezes, the rest of the world gets pneumonia. You're saying that is not necessarily the case right now?

ZOELLICK: Well, I don't want to say that it won't catch a cold, but maybe not pneumonia. But it depends on the degree. I mean, the United States is still 25 percent of the world economy. You can't ignore that. But you have to look at Europe, Japan, but increasingly other players as well.

BLITZER: On "Late Edition" a couple of weeks ago, I interviewed the former chairman of the Federal Reserve, Alan Greenspan. And he said that in his estimate the U.S. was approaching a near 50-50 chance of a recession.

ZOELLICK: All I could say is that, you know, he's a very experienced person. I tend not to make forecasts because unfortunately they tend to often be wrong.

BLITZER: One of the problems -- maybe it's not a problem, but let me ask you if it is a problem, $88, $89 a barrel for oil, approaching $100 a barrel, which only recently that would have been considered unheard of. And that's a bonanza, obviously, for the oil- exporting countries, whether the Saudis or Iran, Iraq for that matter, Russia. But it's a serious drain on a lot of other countries.

How big of a problem is oil approaching $100 a barrel?

ZOELLICK: Well, it's interesting you mention it, because the two areas from the perspective of the developing world that I have been trying to anticipate or be -- have some concern about are both that and world food prices.

Again, in both cases, it's a benefit for some, but it puts a real strain on others. And I think in the energy market, my particular concern has been that if you look at the overall spare production in the international economy, it's expanded a little bit over the past year, but it's still very, very tight.

And what this means is that if you are in an environment where something goes wrong and there's, you know, major problems in some production area, you get this spike effect.

So part of what you've seen here, I think, is a psychology and markets because of some of the events that have happened in Turkey and elsewhere.

BLITZER: Now, one of the countries that is going to be making a lot of money as a result of oil exports is Iran. The World Bank -- and correct me if I'm wrong -- right now has nine government projects in Iran totaling $1.35 billion. Is that about right?

ZOELLICK: I think the amount is less. The projects -- we haven't had any new projects since 2005. The projects that are in place are ones that dealt with some of the earthquake recovery and some of the environmental issues from the past.

BLITZER: But it's a least a billion dollars?

ZOELLICK: It may be a little bit less. I just don't know for sure. BLITZER: Here's what Fred Thompson, the former U.S. senator, a Republican presidential candidate, said on September 25th: "I'm all for the World Bank financing projects that are intended to reduce poverty and help others abroad. But American taxpayers' money shouldn't be used so that Tehran can divert its own money into a nuclear weapons program, long-range missile development, terrorist operations throughout the region, and most heinously, providing arms and support to those who are killing American soldiers in Iraq."

BLITZER: You want to respond to Senator Thompson?

ZOELLICK: Well, I think the point is, is that, you know, the board of the bank, which included the United States, made loans in the past. I have emphasized and I've written this to the U.S. Congress that whatever the U.N. Security Council does, we need to be well- aligned with.

And so, I actually asked our general counsel to write the legal authorities of the U.N. to make sure that whatever we do is -- complies with any actions they take. So far, the U.N. Security Council has made exceptions for humanitarian and development. But as I said, we don't have any other projects in the line.

Existing projects are the ones that frankly are the types of things that date from years ago that are dealing with issues like earthquake recovery.

BLITZER: So would it be fair to say that you're not anticipating any increased World Bank activity beyond what you already have right now in Iran?

ZOELLICK: Yes, that would be fair to say.

BLITZER: All right. Let's talk about China right now. And I'll read to you from a Washington Post editorial on September 21st: "China, a magnet for foreign private investment and its central bank is sitting on $1.3 trillion in reserves, $1,000 for every Chinese man, woman and child. So why is the World Bank, a poverty-fighting institution, still lending to China and other so-called middle-income countries?"

Which is a fair question.

ZOELLICK: Oh, it's a very fair question. And I think there is a good answer. First off, if you look at where the poor are in the world, China, India and the so-called middle-income countries that they refer to are still home to 70 percent of the poor.

So if we're going to be an institution that addresses poverty, we need to deal with those countries.

BLITZER: So why can't...

ZOELLICK: Second -- can I just...

BLITZER: ... the Chinese government... ZOELLICK: Let me finish, and then I'll give you -- is that, second, obviously there is a great interest in topics like climate change and how one deals with energy and the environment.

In 2005, China was on -- every two days on average, building a new coal-fired electricity-generating plant of about 100 megawatts. So if we are going to deal with the issue of climate change, we are going to also have to deal with the countries like China...

BLITZER: But why can't the Chinese...

ZOELLICK: But third -- third...

BLITZER: ... government take the lead in this? Why does -- when they are sitting on so much money, why do they need the World Bank to come in and help them do what they should be doing anyhow?

ZOELLICK: Well, it is exactly that point. The loans that we give them are rather modest. What they're primarily getting is the knowledge services that are packaged with the loans. So about 70 percent of our projects in China now deal with the environment.

So when they -- they don't need to borrow from us. They borrow from us partly as a way to compensate us for dealing with the different (ph) projects we have. But with developing countries like China, we are trying to expand the ways that we would be compensated for applying this expertise.

And whether it be health-care projects or environmental projects, some can be done by fees, some can be done for services for asset management, some can -- the Chinese happen to like a package for loans.

And I will explain -- it's interesting. The way that they draw on the World Bank is they often use us as a demonstration effect. So we do a project, we test it rigorously with them, and then they expand it more generally.

And they believe, and I don't think this is an unsound view, if we also have money at risk, it will be a better-run project.

BLITZER: Here is the...

ZOELLICK: So the -- but the last key point is this, and it's a fair question, but you have got to give me a chance to answer it too.

BLITZER: Go ahead.

ZOELLICK: OK. Is, is that, look, we now live in a world where, if we ignore the Brazils, the Indias, the Chinas, what I've seen in the world of diplomacy and political security affairs is that we are not going to have a very effective multilateral system.

I partly want to work with those countries because then when we deal with other issues like Africa, I would like to have them be as better partners. So it's in part issues of poverty, issues of energy and environment, issues of development around the world, we need to have good relations.

But it isn't -- it is a mistake to see it primarily as a lending issue.

BLITZER: Because here's the criticism, and you have heard it, that by devoting your resources -- and this is important for you to these so-called middle income countries, whether India or China or Brazil or whatever, you're neglecting real poverty in Africa, for example.

Let me read to you what a former World Bank research economist, William Easterly, said to The New York Times on October 12th: "Here is your most important client, Africa, with its most important sector, agriculture, relevant to the most important goal -- people feeding their families -- and the bank has been caught with two decades of neglect."

ZOELLICK: He is saying a different point than you're saying, though. And he's saying a point that is fair, that we have to address. That would be a problem if we didn't have access to financial resources. But that isn't our constraint.

We're well-capitalized, both IFC, our private sector arm, and IBRD. So frankly, the bank's portfolio has been shrinking. We should be growing to try to deal with some of these development challenges. And we have room to grow to help China and India as well as Africa.

Now most African countries are helped with something called IITA, which is not the way that China borrows. China borrows at market rates from us. IITA is either grants or concessionary loans.

So actually I'm trying to work with the U.S. and other developed countries to increase the contributions we get to IITA, which we try to do every three years. And I also boosted the World Bank contribution. And guess what, some of the World Bank contribution comes from the revenues that we have from (inaudible)...

(CROSSTALK)

BLITZER: So what you are saying is...

ZOELLICK: ... to these other countries.

BLITZER: ... you could do both?

ZOELLICK: Yes. We can and should. And that question goes to the agriculture development issue. And on that, he's right, because we have a report that's coming out that shows the fact that the benefits for poverty reduction, of growth in agriculture, are about four times that of other sectors.

So the challenge now in Africa and agriculture isn't just expanding the area under cultivation. It's improving the productivity and the support systems. BLITZER: We're almost out of time, but I want to get your quick thought on corruption around the world. Money that the World Bank gives various countries, a lot of it, as you know, simply disappears or goes into bad hands.

The Volcker Report that came out in September: "A lack of common purpose, distrust and uncertainty has enveloped the anti-corruption work of the bank, the economic losses to corruption are enormous overall, and further, aid effectiveness is much lower in corrupt environments."

And Senator Evan Bayh, Democrat of Indiana, says: "The motto of the World Bank is 'working for a world free of poverty,' but there is a real question as to whether the bank as currently constituted is an effective instrument for alleviating poverty. Bank officials are too willing to accept corruption as just another cost of doing business in certain countries."

Is that criticism fair?

ZOELLICK: I think some of the criticism has been fair. And that is why the Volcker Report was requested by the World Bank. And he came up with a series of recommendations which I think are pretty good.

They are quite complex because some of them deal with how we make sure the internal investigations unit works effectively with people on the staff, but how we not only use investigations, but how we use preventative measures.

So the core point about having good governance and anti- corruption policies is critical to governance and to development. It's not only important for the countries that support us in the United States and Europe and elsewhere, but who gets hurt most?

It's the poor who this money gets stolen from.

BLITZER: So this is a priority for you. What's the most important thing that you as the president of the World Bank can do right now to deal with this issue of corruption, whether in the Third World or elsewhere?

ZOELLICK: It isn't one thing. And the reason why is it has to be integrated, everything we do. And let me just give you a good example, is that we have a "doing business" report, and it shows about how you can reduce regulations and licensing and other things that help draw businesses.

Those are also the reasons why many people have corruption. You create out of that regulatory structure. So frankly, it has to be in our projects, it has to be in our investigations, it has to be in our transparency. So everything we do in this institution has to have at core the notion that governance and anti-corruption has to be built into the development strategy.

BLITZER: Got to leave it there. You've got a tough job, as I said before. Good luck.

ZOELLICK: Thank you very much. Thanks, Wolf.

(END VIDEOTAPE)

BLITZER: And coming up, our political panel analyzes some new CNN polls showing Hillary Clinton up, Fred Thompson down.

And later this week, don't miss CNN's groundbreaking "Planet in Peril" series. The two-day special airs Tuesday and Wednesday, 9 p.m. Eastern. A special you'll see only here on CNN.

"Late Edition" will be right back.

(COMMERCIAL BREAK)

BLITZER: Welcome back to "Late Edition." I'm Wolf Blitzer in Washington.

We will get to our political panel shortly, but we are also keeping a very close eye on what's going out in California. Some serious wildfires that seem to be escalating. Fredricka Whitfield is joining us from the "Late Edition" update desk. What's the latest, Fred?

FREDRICKA WHITFIELD, CNN ANCHOR: That's right, pretty serious wildfires under way right now in Southern California. And these live pictures just coming in right now, live along with taped pictures, pretty vivid images of how destructive these fires are, particularly in the Malibu section. All being fueled by these powerful Santa Ana winds. You can see the heavy dark smoke covering large areas. At least one home has been destroyed right now. Fire threatens hundreds of homes in some of Malibu's upscale neighborhoods.

Pepperdine University Malibu's campus also being threatened. Students are being told to stay in their dormitories, as well as faculty and staff members are being asked to go to the Tyler campus building, and a condor preserve also being threatened there in the Malibu area.

Power is out in some areas, and wind-driven flames also closing sections of the famed Pacific Coast Highway.

Earlier, we spoke with the Forest Service official.

(BEGIN VIDEO CLIP)

STANTON FLOREA, U.S. FOREST SERVICE: The water ducts are a little less effective when the winds are high, just because the water dissipates with high winds. Safety is just going to be our primary concern.

WHITFIELD: Oh, absolutely.

FLOREA: We are trying to fight the fire on the ground using existing dozer (ph) lines and engines and some of our hotshot crews.

(END VIDEO CLIP)

WHITFIELD: So this is a 50-acre blaze burning out of control in the Malibu area. And, Wolf, there's another pretty significant wildfire under way there in the Los Angeles County area, and that's at the Los Angeles National Forest. But the Malibu blaze is the one of most concern, because it's threatening so many structures, particularly homes, and Malibu, home to a lot of famous folks, such as Olivia Newton-John, Dick Van Dyke, even Mel Gibson.

BLITZER: It's a beautiful area indeed. Pepperdine University in danger...

WHITFIELD: Yes, really is striking.

BLITZER: ... as well right now. All right, we will stay on top of this with you, Fred, and update our viewers as more information becomes available. Let's hope it scales back.

Coming up here on "Late Edition" -- Republicans are fighting over who is the most conservative candidate to win those key first few primaries. We are going to analyze what's coming up with our best political team on television. We'll be right back.

(COMMERCIAL BREAK)

BLITZER: Some key developments here in Washington and on the presidential campaign trail this week. So let's get right to it with three of the best political team on television. CNN senior political analyst Gloria Borger. CNN White House correspondent Elaine Quijano. And CNN senior political analyst Bill Schneider. Guys, thanks to all of you for coming in.

Elaine, the president had a news conference this week in which he underscored this point. Let me play this little clip.

(BEGIN VIDEO CLIP)

BUSH: I will sprint to the finish and finish this job strong. That's one way to ensure that I am relevant.

There's a lot of unfinished business. And, you know, I'm really looking forward to the next 15 months. Looking forward to getting some things done for the American people.

(END VIDEO CLIP)

BLITZER: You know a president is in trouble when he has to say, "I'm relevant." That surprised a lot of us to actually hear him say that.

QUIJANO: Well, you know what, I think some people are going to disagree with what I'm about to say here. Because yes, he did address that issue of relevancy, which, of course, are echoes of Bill Clinton.

At the same time, though, look at what happened this week. Democrats were unable to muster up enough support to override his veto on SCHIP, the children's health program. We also saw the president come out very forcefully, mocking even in that same news conference Speaker Nancy Pelosi's Armenian genocide revolution, and then she backs away, lo and behold, from her promise to bring that to a vote.

Not to mention, on the foreign policy front, look, he's still commander in chief. We are not just talking about Iraq, either. There are a host of other foreign policy challenges out there. Pakistan we have seen. So certainly, 15 months is still a long time for this president (inaudible).

BLITZER: And he proved this week he is, in fact, still relevant, because he got his way on a couple of these issues.

But, Bill, listen to what the former president, Bill Clinton, said back in '95. Echoes, or at least foreshadowing what this president said.

(BEGIN VIDEO CLIP)

BILL CLINTON, PRESIDENT OF THE UNITED STATES: The Constitution gives me relevance. The power of our ideas gives me relevance. The president is relevant here.

(END VIDEO CLIP)

BLITZER: All right, so we have heard this relevant talk before.

SCHNEIDER: After each of those presidents lost the midterms. 1994 for Bill Clinton, 2006 for George Bush. They both lost control of Congress. But they both had something else in common that kept them relevant. Bush has retained the loyalty of his Republican base, and Clinton retained the loyalty of his Democratic base, even when he faced impeachment. The loyalty of your base is absolutely crucial. Your base have been defined as the people who are with you when you're wrong. If you have people who will stick with you through thick and thin, then you have something to go on, and the loyalty of Bush's Republican base has really kept him going an stymied the Democrats in Congress over and over again.

BLITZER: Gloria, what's your take?

BORGER: Well, presidents are always relevant. It would be ridiculous for any of us to claim that the president of the United States is not relevant.

But the folks who are really directing the Republican agenda right now are the presidential candidates on the campaign trail. And what Bush is trying to do in taking on these fights is aid them on the campaign trail, trying to talk about things like lower taxes. So, you know, he is relevant, but he's trying to sort of give them some support there as they go out and campaign in New Hampshire and Iowa.

BLITZER: Does the president, Elaine, because you cover the White House, does he feel bad that these Republican presidential candidates, when they go out and deliver their stump speeches and they make their appearances, whether at debates or elsewhere, they are really not talking too much about him and not trying to ride his coattails?

QUIJANO: Well, you know, it's funny, because well before this point, President Bush said, look, I understand -- in sort of private conversations -- I understand, I'm a politician. He knows what the situation is like, that at some point this would happen.

I think what's interesting to note is that it's happened so early. Of course, we have seen these candidates, as you noted, they are trying to distinguish themselves, sort of distancing themselves from these policies. No one is going out there saying, look, I will continue carrying out the policies of this two-term Republican president.

But the president doesn't certainly express disappointment about that. He understands the political reality of it.

BLITZER: Let's talk about the Republican presidential candidates. They were -- all of them were here meeting with religious right, Christian conservatives at a conference here in Washington. They had a straw poll, Bill, at the end. And here are the results: Romney came in on top with 28 percent; Huckabee 27 percent; Ron Paul had 15 percent; Fred Thompson, 10 percent. Everybody else down in single digits. So what do we take from this conference?

SCHNEIDER: Well, first of all, 28 percent was the winner. That means they're all over the place. And it was a very narrow win for whatever it represented for Mitt Romney over Mike Huckabee.

The people who were there in the room voted overwhelmingly for Mike Huckabee. We don't know who voted. A lot of people were voting online. And they could do that starting last August. We don't know if this was representative of the larger Christian conservative community. It's hard to draw...

BLITZER: This is not a scientific poll. Is that what you're saying?

SCHNEIDER: It's hard to draw a conclusion from this.

BLITZER: Giuliani spoke before this group. And he's the only Republican presidential candidate who supports abortion rights, gay rights. He didn't necessarily hide that, but he did try to couch it in a certain way. Here's a little clip, Gloria, of how Giuliani addressed this issue.

(BEGIN VIDEO CLIP)

RUDOLPH GIULIANI, REPUBLICAN PRESIDENTIAL CANDIDATE: You and I, and I believe almost all Americans, share the same goal -- a country without abortion, achieved by changing the minds and hearts of people.

(APPLAUSE)

(END VIDEO CLIP)

BLITZER: He got some applause there as you heard. What do you think of the way he handled this and other sensitive subjects before this Christian conservative group? BORGER: Have you ever heard of threading the needle? That's exactly what he was trying to do. And I think he did pretty well. He also said, look, I'm a man of principle. Wouldn't you rather have somebody who actually tells you what he believes than somebody else who flip-flops all over the place, which is, of course, what he's talking about is Mitt Romney.

He's never going to be the favorite of the Christian conservatives. He's not going to be their candidate. So what you have right now is all of the other Republican candidates trying to say, who's going to be the one to take Giuliani's place? BLITZER: Because if Giuliani were to get the Republican nomination, a lot of conservatives, social conservatives either might not vote for the Republican, have a third-party candidate. Tony Perkins, I spoke with him earlier in the week. He's the president of the Family Research Council. Listen to what he said.

(BEGIN VIDEO CLIP)

TONY PERKINS, PRESIDENT, FAMILY RESEARCH COUNCIL: I would not vote for a pro-abortion candidate, even if it's the only choice I have as a Republican voter.

(END VIDEO CLIP)

BLITZER: What do you think about this?

SCHNEIDER: I think that Giuliani is trying to make it clear in that constituency that he respects them. He doesn't agree with them. He respects them. And he hopes that that may be enough for them to at least tolerate him and not run a third-party candidate.

The most importance sentence in his speech was when he said, "Please know this. You have absolutely nothing to fear from me." I wonder what he meant by that? I am hoping he will explain it perhaps in a debate. What did he mean by saying, you, Christian conservatives, have absolutely nothing to fear.

BLITZER: Because he made it clear, Gloria, and Elaine -- and I want you both to weigh in. Gloria, you first -- that he would nominate Supreme Court justices who -- like Samuel Alito, like Clarence Thomas. He gave specific names trying to reassure this constituency out there that he'd be with them, in effect.

BORGER: And you know, that's one of their key issues. And I spoke with a key conservative evangelical leader this week who said we are one vote away on the Supreme Court from overturning Roe v. Wade. And that is what we should be thinking about and not throwing this election away to a Democrat like Hillary Clinton.

BLITZER: Because if there was a third-party Republican candidate out there, let's say Giuliani got the Republican nomination, and they went ahead with the third-party, anti-abortion candidate, in effect that would certainly almost guarantee the election of the Democrat, assuming that's, let's say Hillary Clinton. But some people are saying the principle is more important than the politics. QUIJANO: Yeah, and you know, I want to bring into the debate here the issue of immigration, because that is one of President Bush's sort of political legacies. Of course, this was the ugly debate that happened, and we saw the results.

We saw Sam Brownback say that, you know, look, I understand that my position on this comprehensive immigration bill hurt me. We have seen John McCain come out and say, look, I know that this is not particularly popular with some social conservatives. They see this as amnesty. And this is something that President Bush fought very hard to try and accomplish. It did not pan out. And now we are seeing some Republicans paying the price.

BLITZER: All right, guys, stand by. We have a lot more to talk about. And we will talk about it, including what's happening on the Democratic presidential front.

Also coming up, comedian Stephen Colbert announced he's running for president of the United States. You're going to find out what his message is, the message to voters. That and more in our "in case you missed it" segment. "Late Edition" will be right back.

(COMMERCIAL BREAK)

BLITZER: Welcome back. We're talking about the week's hot political stories with our White House correspondent, Elaine Quijano, and our senior political analysts, Bill Schneider and Gloria Borger.

Sam Brownback, the Republican senator from Kansas, he was a presidential candidate. He dropped out this week. Any of you venture to speculate who might be the next Republican candidate to announce that -- you know, Tommy Thompson has dropped out, Jim Gilmore dropped out.

They're dropping. They're beginning to drop. Who might be next? Who should we watching for, Bill?

SCHNEIDER: I'm not in the business of expelling anybody from this race, so I'm not going to answer that.

BLITZER: You don't want to speculate.

QUIJANO: I don't know that you necessarily want to count anybody out at this point either. I think that's something that we've certainly seen, anything can happen.

BLITZER: Anything can -- what do you think?

BORGER: Well, you know, I don't know. I think Newt Gingrich was talking about getting in, and he said he wasn't going to get in.

BLITZER: He dropped out before he dropped in.

BORGER: Yeah, that's right. And now Fred Thompson looks like he's not doing so well. So maybe Newt will think about it again. I think we've got the field we've got for a while. BLITZER: Let's talk about John McCain for a moment. He's trying to position himself as the really true conservative, the faithful. He's going after that conservative element. This is what he said earlier this morning. Listen to this.

(BEGIN VIDEO CLIP)

U.S. SENATOR JOHN MCCAIN, R-ARIZONA: I'm proud to stand on that record as really the only one right now conservative that can beat Senator Clinton when she's the nominee.

(END VIDEO CLIP)

BLITZER: That's what they're all saying, basically. Giuliani keeps saying it, that he could beat Clinton. They're all assuming that Hillary Clinton's going to get the Democratic nomination.

BORGER: Sort of like "mirror, mirror, on the wall, who's the truest Republican of us all?" Right? And I think that's because each of them wants to be the alternative to Rudy Giuliani, whom they believe is not a true Republican.

And so they believe Giuliani eventually will falter, that he's doing well in the national polls but that in state contests, he won't do as well. And so someone like McCain wants to be there, ready and standing tall when Giuliani does falter.

SCHNEIDER: You know, they're all trying to be the true conservative and every one of them has problems with conservatives. McCain has serious problems with conservatives because he was an advocate of campaign finance reform, which they're angry about, and immigration reform, which some of them will never forgive him for.

BLITZER: Here's what Romney said this morning on "Face the Nation." Listen to this.

(BEGIN VIDEO CLIP)

MITT ROMNEY, REPUBLICAN PRESIDENTIAL CANDIDATE: They're not going to accept my religion necessarily, but they will certainly see me as someone who can be one of those who can carry the standard of conservatives for major social issues.

(END VIDEO CLIP)

BLITZER: Now he's doing well, Elaine, in the straw polls. He's doing relatively well in Iowa, in New Hampshire in the polls there. But in the national polls, he's still not doing all that great.

In our latest CNN Opinion Research Corporation poll. Giuliani has 27 percent, 19 percent for Fred Thompson, 17 percent for McCain, 13 percent for Romney. Everybody else down in single digits. But Romney is creating a niche for himself out there.

QUIJANO: He is creating a niche for himself. It remains to be seen whether he can overcome a lot of doubts that some -- particularly evangelical Christians have about his faith. He did talk about that. We heard him sort of joke about that, saying, well, you know, look, I understand your discomfort.

QUIJANO: Because after all, Senate Majority Leader Harry Reid is Mormon, too. So he tried to make light of it. But there's a sense that, you know, he didn't really necessarily seriously tackle it in a way that would assuage those kinds of concern.

BLITZER: Obama the other night was on "The Tonight Show," and he joked about Hillary Clinton. Listen to this.

(BEGIN VIDEO CLIP)

U.S. SENATOR BARACK OBAMA, D-ILLINOIS: Hillary is not the first politician in Washington to declare "mission accomplished" a little too son.

(END VIDEO CLIP)

BLITZER: All right. He's got a challenge, though, ahead of him. Because, if you look at the Democratic poll, our CNN Opinion Research Corporation poll, right now she's up at 51 percent, Obama 21 percent. That's a 30-point spread. Fifteen percent for Edwards. Everybody else down in single digits. He's got to do something.

BORGER: Right. She is creating this sort of sense of inevitability about her nomination. What Obama has to do is win Iowa. He has to do very well somewhere in a single state early on. He has to either beat Hillary Clinton or come within one or two points of her, or she is going to run the table.

SCHNEIDER: You know, it's interesting. When I see Democrats, they all raise their hand and ask a single question: Can Hillary get elected? And right now, the answer looks like she can. So they say, well, all right then, Hillary.

When Republicans ask the question, they raise their hands and they say, who can beat Hillary Clinton? Well, right now Giuliani claims he's the one who can do it, but they're all competing to make that claim. Hillary Clinton is at the very center of the contest in both parties.

QUIJANO: And Hillary Clinton also trying to burnish her national security credentials because the issue of Iran, which we have heard is sort of coming to the forefront here. She has taken some heat for being the only one to support the president's move to try and designate the Revolutionary Guard Corps a terrorist organization. And so she's trying to defend against that. BLITZER: All right, guys, we've got to leave it right there. Good discussion. Thanks to all of you for coming in. We'll take a quick break. Much more "Late Edition" right after this.

(COMMERCIAL BREAK)

BLITZER: There's a dramatic fire near Malibu in California. These are pictures that are just coming in to CNN. Paul Vercammen is right in the middle of everything out there. Set the scene for us, Paul. What's going on?

PAUL VERCAMMEN, CNN CORRESPONDENT: Well, we've got nasty (inaudible) dastardly winds and, Wolf, they were roaring through this part of Malibu Canyon when we came through. We saw at least, we would say, five structures, homes and a church fully engulfed.

The problem out here today is that the winds are absolutely vicious and strong. They've blown all the way down the state (ph) here in Malibu, and you can probably hear them kind of whipping through in the background.

When we drove through that canyon area, we also saw quite a few downed power lines. And it's believe those power lines could have started the fire. That has not been confirmed yet, but the winds were definitely strong enough to push over and snap those wire lines down.

As I'm talking to you live, I see yet another structure on fire. And so this blaze is active in several fronts. It's not just burning in one area. And we have seen plenty of those floating embers, which are really a bane to firefighters' existence because what they do is they get up on a hard, hard rim and they help the fire skip to other places by landing in trees and on roofs, et cetera.

BLITZER: Hey Paul, how close is this fire, actually, to Pepperdine University, which is a beautiful campus out there?

VERCAMMEN: It's extremely close. In fact, the pictures that you were looking at I would say were a quarter-mile southwest of Pepperdine. We now see a chopper coming up, trying to get some water on parts of the fire in the distance.

So the fire has actually surrounded Pepperdine and is all around it. But in driving here, we did not see anything at Pepperdine on fire.

BLITZER: Paul Vercammen's right in the middle of things over there. We're not going to leave this story for very long. All right, Paul, thanks very much. Fredricka Whitfield's going to have a lot more on the top of the hour on these fires in southern California.

We'll take a quick break. More "Late Edition" after this.

(COMMERCIAL BREAK)

BLITZER: And that's your "Late Edition" for this Sunday, October 21st. For our international viewers, word news is coming up. For our North American viewers, Fredricka Whitfield has the latest on those fires in southern California. Fred?

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