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THE SITUATION ROOM

Court Drama on CIA Tapes; Clinton's Iowa Magic; Dems Fight "Do- Nothing" Label

Aired December 18, 2007 - 16:00   ET

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


JOHN KING, CNN ANCHOR: And happening now, a courtroom drama. A judge demands answers about the destruction of CIA interrogation tapes. We'll tell you how the Bush White House is handling this credibility test.
Plus, Hillary Clinton finds magic in Iowa. Who will help her score more points with voters, the basketball legend or her husband?

And where's Rudy Giuliani? That's what some Republicans are asking. Giuliani's travel schedule may say a lot about where his campaign is at and where it's aiming these days.

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

You're in THE SITUATION ROOM.

First this hour, a federal judge calls the Bush administration on the carpet. At issue, those destroyed CIA videos of terror suspects being investigated and interrogated. In question, did the administration defy court orders to preserve those tapes? A hearing is now set for Friday.

Here is our White House correspondent, Ed Henry.

Ed, what's the administration's reaction to this brief but stern ruling from the judge?

ED HENRY, CNN WHITE HOUSE CORRESPONDENT: That's right, John. Well, White House officials are refusing to answer any of these explosive questions about whether the destruction of those CIA tapes was really defying a court order to preserve evidence, as you said, of possible torture.

(BEGIN VIDEOTAPE)

HENRY (voice over): It's a White House version of political hot potato.

DANA PERINO, WHITE HOUSE PRESS SECRETARY: I think that's a question that is best put to the Justice Department.

HENRY: Ask spokeswoman Dana Perino about a federal judge ordering the Bush administration to answer questions about the destruction of interrogation videos...

PERINO: I'm referring you to the Justice Department. HENRY: Is the White House making sure the CIA does not destroy any other tapes or potential evidence in terror cases?

PERINO: I'm going to refer you to the Justice Department.

HENRY: But, in fact, the Justice Department is not commenting on the judge's order either and is not being cooperative with congressional investigations to see if any laws were broken in the destruction of the CIA tapes.

Attorney General Michael Mukasey is refusing to provide any information to the House and Senate intelligence panels, charging that would interfere with his own preliminary inquiry.

REP. PETE HOEKSTRA (R), INTELLIGENCE COMMITTEE: We in Congress, we have a job to do, and we are going to do it. You and the executive branch, you've got a job to do. You go do your job, we're going to do our job.

HENRY: The top Republican on the House intelligence panel says it's not good enough for the executive branch to investigate itself. And he may support congressional subpoenas to force answers.

HOEKSTRA: There were misleading statements that came to the Intelligence Committee from the community regarding these tape. You know, we have a constitutional responsibility to do our job and to hold the community accountable for the work that it has done or the work that it has not done.

HENRY: Will the White House comply with those subpoenas?

PERINO: I'm going to refer you to the Justice Department.

(END VIDEOTAPE)

HENRY: Now, the showdown will come -- the showdown will come this Friday at 11:00 a.m. in federal court here in Washington. It will be an open courtroom, so there will be press coverage. The next chapter in a story that has become more and more curious -- John.

KING: A quick question, Ed. And I hope you won't refer me to the Justice Department.

The White House is, you know, hiding -- my word, not theirs -- behind the lawyer question, saying they can't answer questions about this because the lawyers are all looking into it, there are ongoing investigations. I understand that to a degree from the legal perspective as the investigations go. But politically they must be cringing with Republicans in Congress questioning them, some of the lawyers involved in this case saying cover up, people saying what are you trying to hide?

Politically, this must be a nightmare.

HENRY: Absolutely. It's very difficult and it is a question of credibility. But I think the White House realizes that they have used this before.

As you know, in the Scooter Libby case, they were able to deflect questions for probably a couple of years in that legal case by continually saying there is an ongoing investigation, an ongoing legal matter, we're not going to answer any questions. In the end, though, obviously they still took a political and a public relations hit. But they were able to sort of kick the can down the road for a couple of years -- John.

KING: Interesting court hearing to watch on Friday.

Ed Henry at the White House.

Thanks very much, Ed.

HENRY: Thank you.

KING: A new development today in the political battle over the Bush administration's wiretap without warrant program. Senate Majority Leader Harry Reid decided yesterday to delay a vote on overhauling surveillance laws, arguing the Senate needs more time to debate such an important measure. Reid now says that debate may not happen before the current law expires at the end of January, so he plans to ask for the existing law to be extended by one month.

GOP leaders though say they may not go along with that extension because they think the Democrats have engaged in stalling tactics on the bill for months.

Now to Magic in the presidential race. Basketball great Earvin Johnson is giving Hillary Clinton's campaign a new shot of star power. The question is, can it help win votes in the big state of Iowa?

Suzanne Malveaux is out there tracking all this. Not only tracking it, but had a chance to talk to the two stars today, the candidate's spouse and Magic -- Suzanne.

SUZANNE MALVEAUX, CNN WHITE HOUSE CORRESPONDENT: Well, you're absolutely right. I mean, people are using everything they have at this point. That is including the star power of Magic Johnson today to bring out all those crowds to support Hillary Clinton. But they are controversial comments that her husband made, the former president, that really threatened to overshadow this kind of positive tone that her campaign is taking on.

So we asked Mr. Clinton about it.

(BEGIN VIDEOTAPE)

EARVIN "MAGIC" JOHNSON, FMR. NBA PLAYER: I love the Clintons and...

MALVEAUX (voice over): This is the picture the Clintons want Iowa voters to see -- the campaign for Senator Hillary Clinton full of magic.

JOHNSON: She's the only one with 30 years of experience -- 35 years. OK. Good.

(APPLAUSE)

JOHNSON: When you think about 30 years of experience, of doing public service, that means she is unbelievable at it. She's the best at it.

MALVEAUX: Basketball superstar-turned-businessman Magic Johnson is now stumping for Hillary Clinton, hitting all the main talking points and even delivering what sounded like a veiled swipe at Barack Obama.

JOHNSON: We do not want somebody in there that is young or a rookie at politics. We want somebody in there that knows what they are doing because this job is so huge.

MALVEAUX: A friend of the Clintons for more than 20 years, Magic is here to give Hillary some street cred, as well as highlight issues.

JOHNSON: You think about her experience of bringing us out of debt, healthcare, education, she's the one person who can bring all those things back to us as a country.

MALVEAUX: But the Clinton campaign has to play a delicate balancing act. Former president Bill Clinton is causing controversy over his sharp questioning of Obama's credentials. Even suggesting he, Clinton, had the good sense not to run until he was ready.

We caught up with Mr. Clinton in Des Moines.

(on camera): Some of the comments you made about Barack Obama, you had said that in 1988, you weren't ready to be president. You didn't run. Are you trying to say that Barack Obama isn't ready either?

WILLIAM JEFFERSON CLINTON, FMR. PRESIDENT OF THE UNITED STATES: No. I'm trying to say that I agree with what the "Des Moines Register" said, that Hillary has the best record of positive change- making in other people's lives, and I think it's important. And I think that's why they endorsed her.

That's what I was trying to say. I think -- I bragged on all of them -- Senator Obama, Senator Edwards, all of them. I like them.

MALVEAUX (voice over): If you rewind, during our exchange you can hear Senator Clinton urging her husband to move on.

W. CLINTON: Hillary has the best record of positive change- making in other people's lives and I think that's why then endorsed her.

SEN. HILLARY RODHAM CLINTON (D-NY), PRESIDENTIAL CANDIDATE: We've got to go. The kids are waiting for us. Come on.

W. CLINTON: That's what I was trying to say. I think...

(END VIDEOTAPE)

MALVEAUX: And John, there's some political analysts who suggest that they do move on, that that is a good idea, because they say while former President Clinton, he does have a lot of credibility within the party, they say going too negative or pushing too hard, too aggressive, might actually backfire for his wife -- John.

KING: A sneaky suspicion, Suzanne, you might be able to translate that "Move on" to "Please stop talking."

Suzanne Malveaux.

MALVEAUX: Yes. Stop sucking the air out of my campaign, yes.

KING: Catching the candidates in Iowa and the candidates' spouses, Suzanne Malveaux.

Thank you, Suzanne.

And John Edwards is flaunting his own celebrity supporters. Singing stars Bonnie Raitt and Jackson Browne appearing with Edwards at campaign events in New Hampshire today. Actors Kevin Bacon and Tim Robbins have also been stumping with Edwards.

Time now for our own celebrity, "The Cafferty File." Jack joins us from New York.

Hi, Jack.

JACK CAFFERTY, CNN ANCHOR: I'm stumping with Mickey Mouse, John.

It looks like family values aren't the campaign issue they used to be. "USA Today" reports that in this election cycle, so-called "family values" are lower on the agenda. Of course, Republicans have made family values a staple of their political campaigns for three decades now.

But in this current campaign, Mitt Romney is virtually alone in stressing that issue. "USA Today"/Gallup poll shows that although most voters say that family values in general are important to them, they don't care all that much about the candidates' personal lives. There are several reasons for the change, including cultural shifts in society and the backgrounds of several of the current Republican candidates.

Rudy Giuliani, John McCain and Fred Thompson have all been married and divorced and remarried. There's also the importance of issues like the war, terrorism, and the economy.

One Republican strategist says today's atmosphere has been shaped by a series of traumatic events -- the 9/11 attacks, Hurricane Katrina, and the Iraq war. He says in the 1980s and '90s, the perfect shot was the candidate, the spouse, the kids, and the dog.

In the 21st century, it's all about action. It's all about getting things done. So here's the question. What does it say about the U.S. in 2007 if family values lost their punch as a campaign issue?

E-mail us at caffertyfile@CNN.com or go to cnn.com/caffertyfile, where you can post a comment on my blog -- John.

KING: Interesting question. Looking forward to it.

Thanks, Jack.

Underdog Ron Paul in the money and on the issues. Are his controversial views fueling his huge cash haul on the Internet? We'll look for the secret to Ron Paul's fundraising success.

Plus, Fred Thompson revs up his campaign in Iowa. Can he prove to voters he really wants to win?

Our Dana Bash goes one-on-one with Thompson.

And next, Iraq letdown. Poll show Americans are disappointed in the Democrats after their first year controlling Congress.

I'll ask the House majority leader, Steny Hoyer, how and where things went wrong.

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

(COMMERCIAL BREAK)

KING: Democratic leaders are wrapping up their first year in control of Congress. And President Bush says they don't have much to show for it. Have Democrats failed to live up to their campaign promises on Iraq and other issues, heading now into another election year?

Joining us now, the number two Democrat in the House, the majority leader, Steny Hoyer.

Mr. Leader, thanks for joining us in THE SITUATION ROOM.

I want to start with the fundamental promise Democrats made when they took power back in January, 11 months ago. They said they would end the war in Iraq. Now, I know there are a number of reasons that you could that has not happened, but let's set the reasons aside for a minute.

On that fundamental question, if I'm a Democrat or an Independent or even a Republican who decided in 2006 to vote for the Democrats because I was fed up with the war and I wanted it over, am I right to say as Congress prepares to go home for its Christmas break that Democrats in their first year failed on that fundamental question, the test of ending the war in Iraq?

REP. STENY HOYER (D), MAJORITY LEADER: No, I don't think so, John. You can be frustrated with the fact that the war in Iraq has not ended, but I think you would be wrong to say that we failed because, in fact, we passed through the House of Representatives on three occasions legislation which would have done just that, changed our policy in Iraq.

The Senate was able to pass only one of those which we sent to the president. He vetoed it. We couldn't override his veto because we don't have the votes. But certainly in terms of our effort, we tried at the beginning, we tried in the middle, and we've been trying it to this date to change policy in Iraq.

The American people want a changed policy. The 9/11 Commission recommended changing policy. The Baker-Hamilton Commission recommended changing policy. But this president has chosen to stay the course, and he was supported by a minority of the House of Representatives, but, nevertheless, a large enough minority to stop us from overriding his veto.

So, we have been fighting hard, we have been working hard. We've had oversight hearings. We have, in fact, changed some policies. But we haven't brought the war to a close. But not because of lack of trying, simply because that election was not an election for president. Frankly, this election is going to be an election for president, and that's how we are going to stop this policy and change our policy in Iraq.

KING: Another promise to Democrats made was to end what they call the culture of corruption, saying the Republicans -- you named some specific individual members during the campaign, some members of their leadership, but more broadly, you said there was just a culture of corruption in Congress, special interests ruled the days, bills were written in secrecy, things weren't done. I want your sense on whether you -- how much you succeeded in that, and I asked the question -- let me ask this quickly. You are about to send the president a spending bill that's around $933 or $934 billion, and those who have looked at it say there is 11,000 earmarks in there. There's at least $20 billion in pork barrel spending there.

Incomplete on that one?

HOYER: John, first of all, the facts you just stated are incorrect. But (INAUDIBLE) defense has already passed. That was in the $933. So it's closer to $500 billion-plus. That's a lot of money.

It is one of the most transparent bills that I voted on since I have been in the House of Representatives. We made those earmarks, and you overstated the number of earmarks very substantially, and you failed to mention that we have reduced by 40 percent the number of member initiatives for their districts, for the country in terms of education, transportation, healthcare, those sorts of things.

But in the very first day we passed an ethics rule which was the strongest ethics rule that we had passed in many, many Congresses. We followed that up with a lobbying disclosure bill. We followed that up in the rules in our first day with a transparency requirement for member initiatives. That rule has been followed and that's why I say this is the most transparent bill that we passed. Secondly, let me make the point that you say how many page this bill and how much money it is. The House of Representatives passed each and every one of these bills individually so that every member of the House had a right to amend the bill, had a right to debate individual items in the bill, and we passed it through the House.

We are now passing an omnibus appropriations bill which includes all the bills other than the defense bill in its -- in its totality. But they have all been considered by House members, they've all had an opportunity to read them.

Were there things -- changes because in conferences, difference between the Senate and House have to be worked out? Of course. But that's always how it works.

So the Republican show of the number of pages, if you add it up, each bill that they have passed, they considered, they have had the opportunity to debate and amend, it wouldn't be much different. So I think we have done exactly what we said we would do, and I think the bills will reflect that.

And not only that, this is -- this is the important thing. We have included priorities of the American people in this bill to invest in education, to invest in healthcare, to invest in energy efficiency. Initiatives that the president opposed and did not fund in his bill. And while we have kept the numbers because that was the compromise we made with the president, the initiatives incorporated into the bill carried out what I think the American public want.

KING: Let me ask you quickly...

HOYER: Sure.

KING: ... your party's vice presidential nominee just seven years ago, Joe Lieberman, Democrat, now Independent Democrat from Connecticut, endorsed a Republican in the race for president. He did so because he thinks your party has abandoned its tough positions, its necessary tough positions on national security.

I want you to listen to something Senator Lieberman said yesterday.

(BEGIN VIDEO CLIP)

SEN. JOSEPH LIEBERMAN (I), CONNECTICUT: In November, they'd have a hard time convincing the American people who know we are at war against a brutal enemy that attacked us on 9/11 that they were prepared to do what is necessary to defend America.

(END VIDEO CLIP)

KING: How much does that sting, a former vice presidential nominee of the Democratic Party saying his party is not ready to go into this presidential election year with a message on national security and the war on terrorism that you can sell to the American people? HOYER: Well, I disagree with that entirely. The fact of the matter is that the Democratic Party has consistently been the party, with few exceptions, over a century of policy and national security issues that has been the party that has led us in defeating the terrorists of those times. Whether it was the Nazis, the communists, it was Democratic presidents who led to confrontation and defeat, ultimately, of those entities.

Let me say that I'm sorry that Joe felt called upon to do what he did, but our Democratic candidate, as we have done in the Congress -- the first bill that we passed through this House of Representatives was the 9/11 Commission recommendation bill to keep our country safe. Last night we passed $31 billion in additional funding so that we could confront terrorism and defeat the Taliban which was, after all, the site from which this country was attacked and which, frankly, we have distracted our attention from.

And as far as Iraq goes, we need to defeat terrorists. When we've said we ought to redeploy, we have made the caveat that we ought to make sure that we continue to confront and defeat terrorism.

So I think Senator Lieberman, who I -- is a good friend of mine, I respect him, but I think in this instance he is wrong. And our Democratic candidate is going to make sure that the American public knows that we are going to be committed to the safety of this country, to the safety of our people, and to the defeat of terrorists.

KING: Have to leave it there for today, but we'll have you back when we may have a little bit more information from Iowa and New Hampshire on who that Democratic candidate might be.

The House majority leader, Steny Hoyer.

Sir, thank you for your time today.

HOYER: Thank you, John.

KING: Take care, sir.

It's that time of year to debate the political correctness of saying "Merry Christmas." And Republican Mike Huckabee finds himself right in the thick of it.

Holiday greetings get dissected in our "Strategy Session."

Plus, Congress goes to historic lengths to ease America's addiction to fuel.

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

(COMMERCIAL BREAK)

(NEWSBREAK)

KING: Right now some voters are asking, where's Rudy Giuliani? He's been spending a lot of time in one big state. Wait until you hear where and why.

And they are calling him the $6 million man. But just why are people giving so many donations to Republican presidential candidate Ron Paul? Our Mary Snow takes a close look.

(COMMERCIAL BREAK)

KING: You're in THE SITUATION ROOM.

Happening now, Turkish ground forces chasing after Kurdish rebels in northern Iraq. Is the United States helping Turkey? You will hear what the U.S. is saying and what sources are telling us at CNN.

Also, a U.S. ally's major milestone. Japan successfully tests a missile interceptor. Could it stem potential threats posed by North Korea or Iran?

And it's your money. Do you want it spent on bike trails or to control the infestation of rats in one state? Supporters call them critical projects in a massive spending bill, but others simply call them pork.

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

You're in THE SITUATION ROOM.

All eyes are on Iowa just 15 days now before the first presidential contest. And five of the top presidential candidates are campaigning there today. Two candidates are in New Hampshire, laying the groundwork for the leadoff primary on January 8th.

White House hopefuls are all over the map today, including South Carolina, Georgia, Illinois, and Texas. Rudy Giuliani sticking closer to home. He is in New York.

The presidential contenders are racking up the frequent flier miles in these final days before the voting begins. First, of course, in Iowa and New Hampshire. So those states are high on the must-visit list.

Rudy Giuliani though has not been spending as much time in those early voting states as many of his rivals. And there is reason for that.

Our senior political analyst, Bill Schneider, is looking at the strategy behind Rudy Giuliani's schedule.

So, Bill, where is Rudy?

WILLIAM SCHNEIDER, CNN SR. POLITICAL ANALYST: He has been spending a lot of time in Florida, his first must-win state. Now, where would you rather be this time of year, Iowa or Florida?

(BEGIN VIDEOTAPE)

SCHNEIDER (voice over): What's the big news in the Republican race? Huckabee versus Romney, McCain's endorsements, Ron Paul's money.

Question. Where's Rudy? He is still the national front-runner, according to a new Gallup poll, which four other candidates -- Mike Huckabee, John McCain, Fred Thompson and Mitt Romney -- essentially tied for second. But the action is in the early voting states -- Iowa, New Hampshire, and South Carolina.

Giuliani is not leading in any of them. His pollster say he's not worried.

ED GOEAS, GIULIANI CAMPAIGN POLLSTER: We decided to go after a national strategy. That's what we have been running since the beginning. I think that's what you will continue to see.

RUDOLPH GIULIANI (R), PRESIDENTIAL CANDIDATE: Thank you very much.

SCHNEIDER: The polls show Giuliani's standing has eroded a bit since the summer. That could have something to do with what's happening in the Democratic race. Hillary Clinton does not look quite so inevitable.

SCOTT HUFFMON, PROFESSOR, WINTHROP UNIVERSITY: I think a lot of the support in South Carolina behind Giuliani, behind Romney, was the concept of, this is the person who can knock off Hillary.

SCHNEIDER: If Clinton is less of a threat, some Republicans may be going with the candidate they agree with more. Giuliani's signature issue has always been terrorism. But terrorism is no longer the voters' top concern. Among all voters, terrorism ranks fifth out of five issues. Among Republicans, it is in third place, behind the economy and illegal immigration, and declining in importance.

The agenda is shifting to domestic issues. Is Giuliani worried? Not according to his pollster.

GOEAS: I think what you have seen is not just the terrorism fading as an important issue, as much as there has been a layer added on to Rudy Giuliani, which is an understanding of the job he did as mayor, what he did to bring down welfare, what he did to bring down crime, what he did to cut taxes 23 times.

(END VIDEOTAPE)

SCHNEIDER: Giuliani is a big-state man, Florida, New York, California. But the big states vote late. Giuliani would be happy to see the early-voting states split, say, Huckabee win Iowa, then McCain win New Hampshire, then Thompson win South Carolina, because happiness in politics is a divided opposition -- John.

KING: Interesting strategy about to be put to the critical test.

Bill Schneider, thanks for that look. Thanks very much, Bill.

And our Wolf Blitzer interviews Rudy Giuliani tomorrow in a special edition of THE SITUATION ROOM live from Columbia, Missouri. And, with the holidays coming, what do you give the man who might not have it all, but at least has millions of dollars? Some staffers and some extra time on TV, maybe? That's exactly what the campaign for Republican presidential candidate Ron Paul hopes to get him.

The campaign is flush with cash, hoping to spend it now on extra staff and commercials. So, what is fueling what some have called Paul's money bombs?

Our Mary Snow is in Concord, New Hampshire, looking into this -- Mary.

MARY SNOW, CNN CORRESPONDENT: Well, John, the big question, of course, can that money be turned into votes? Certainly, the Ron Paul campaign is banking it. And Ron Paul, starting tomorrow, will spend several days here, trying to get voters here to support him.

(BEGIN VIDEOTAPE)

UNIDENTIFIED MALE: Hi. My name is Matthew (ph). I'm a volunteer working here in New Hampshire for the Republican presidential candidate Dr. Ron Paul.

SNOW: Here in New Hampshire, this is the test to see if Ron Paul's money talks. On the heels of raising a record $6 million online in a single day, his campaign here in this early primary state is on a mission.

JARED CHICOINE, RON PAUL NEW HAMPSHIRE CAMPAIGN: To turn out our people on Election Day. And with three weeks to go, that's -- that's the focus.

SNOW (on camera): And, really, it is turning people out now?

CHICOINE: It is turning people out now.

SNOW: Translating that Internet support to votes?

CHICOINE: Into votes, absolutely.

SNOW (voice-over): Paul has been in single digits in the polls here. And the campaign first has to get out his message.

UNIDENTIFIED MALE: So, he is going to let the military know that the Americans -- you know, Americans as a whole want to pull out of Iraq.

SNOW: Paul is the only Republican presidential candidate advocating to pull troops out of Iraq and calls for less U.S. intervention overseas. That's a position that has not made him popular with Republicans in this state, say pollsters.

And watch how a group of 21 undecided Republicans in Iowa reacted to what he had to say during last week's Republican debate.

REP. RON PAUL (R-TX), PRESIDENTIAL CANDIDATE: There's no need for us to threaten the Iranians. We could immediately turn the Navy around and bring them home.

SNOW: Paul says these are a small number of Republicans and is targeting other voters.

PAUL: We appeal to a lot of independent voters and disgruntled Republicans, Republicans who have dropped out, who might not have voted in the last go-around. So, they are not being polled. We also attract a lot of young people who have not voted before.

SNOW: Paul's libertarian positions are a big draw. And his consistently emphasizes constitutional rights.

ANDY SMITH, POLITICAL SCIENCE PROFESSOR, UNIVERSITY OF NEW HAMPSHIRE: They are in favor of smaller government, less taxes, certainly a much, much smaller federal government. But then you have got a lot of other things that attract libertarian voters, like legalization of marijuana.

SNOW: University of New Hampshire political science professor Andy Smith says, while Republicans in this state seem to agree with libertarians on fiscal policy, they are not in synch on social issues. And, to them, Paul is a hard sell.

(END VIDEOTAPE)

SNOW: And, as for that $6 million that was raised online on Sunday, just where it will be going, the Paul campaign says it plans to spend it in states beyond the early primary states, like New Hampshire, and, instead, look to Florida, New York, and California -- John.

KING: In for the long haul.

Mary Snow in Concord, New Hampshire -- Mary, thank you very much.

And it's down to the wire for Iowa's caucuses. Republican candidate Fred Thompson is doing something to show how much he wants to win. And many people are taking notice. Our Dana Bash goes one on one with Senator Thompson.

Also, they're the candidates you support, or at least are curious about. But do you know exactly where they stand on the issues you care about? We will show you just how to find out.

And, as governor, was Mike Huckabee tough on crime, or not, as some suggest? We are fact-checking a new ad.

(COMMERCIAL BREAK)

KING: For months, we have been hearing from critics who say Fred Thompson's presidential campaign is going, at best, at slow trot. In Iowa today, the Republican is trying to get things moving, telling voters -- quote -- "Saddle me up."

Our Dana Bash is on the campaign trail with the senator in Decorah, Iowa. Dana, can the senator get on the fast track?

(LAUGHTER)

DANA BASH, CNN CONGRESSIONAL CORRESPONDENT: To put it bluntly, John, I think he has got to get on any track at all at this point.

You know, he's going to spend basically between now and caucus day, January 3, on his bus, making his way, as he says, north, south, east, west around this state, because he understands that, if he does not gain traction, any traction, then he's going to be in big trouble.

He has got some good news here recently. He did pretty well in the debate last week, by all accounts. He got a really big endorsement by a very popular anti-immigration congressman. But the question is, can he capitalize on it?

(BEGIN VIDEOTAPE)

BASH (voice-over): Behold a candidate suddenly trying to go from great GOP disappointment to surprise contender in record time.

FRED THOMPSON, REPUBLICAN PRESIDENTIAL CANDIDATE: Well, it is a little bit late in the process for me to be coy. I want you to know that I think I'm that man.

UNIDENTIFIED MALE: Go get them, Fred.

THOMPSON: OK, buddy.

BASH: A 15-day bus tour to 50-plus Iowa cities. Fred Thompson is trying to shake the rap that he has no fire in his belly. How's this for fire on values?

THOMPSON: They are under assault from a left-wing, big- government, high-taxing, weak-on-national-security Democratic Party that's just licking its chops to take over the reins of the government.

BASH: His red meat is redder, his arguments for why he should be president sharper.

THOMPSON: All the experts know that. That's the kind of world we live in. It is not the time for on-the-job training.

BASH: He even makes a point of lingering with voters, instead of escaping out a back door, a common Thompson criticism.

But catching fire now will not be easy. Many frustrated conservatives Thompson was supposed to attract have flocked to Mike Huckabee or stuck with Mitt Romney. Thompson is playing up detailed policy plans that have not gotten much attention, like Social Security.

THOMPSON: We are going to be in the red in a very few years. We will have eaten through that so-called Social Security surplus. And we will be using our kids' money and our grandkids' money.

BASH: And a crowd favorite in Iowa, his immigration plan.

THOMPSON: If you continue to violate the law and provide these sanctuary cities to lure illegals into this country, we are going to cut off federal funds. It is just that simple.

(END VIDEOTAPE)

BASH: Now, what Thompson is really relying on at this stage in the game, John, is the fact that there are still so many undecided, or at least unsatisfied Republican voters here in Iowa, that may have thought about it at the beginning, but then really weren't that turned on by him, so to speak, and then they looked elsewhere.

But, then, they really didn't find another candidate. So, they are coming back to give him a second chance. We found a lot of Republican voters, interestingly enough, who were sort of in that camp at these Thompson events so far here in Iowa.

But the big question is whether or not he can really seal the deal with them and lure them away from the other candidates, like Mike Huckabee and Mitt Romney, who, obviously, are doing a lot better here.

KING: Well, Dana, just a few moments ago, you had a chance to go one on one with the senator about this new push of his.

Let's listen.

(BEGIN VIDEO CLIP)

THOMPSON: I mean, I have been working hard for several months now. You know, I think, sometimes, the media had a notion, you know, that, because I had been in the movie business, that I would be well- scripted, that I would be slick, that I would be perfect.

And it was a standard nobody else was held to. But I think I was held to it. And, so, they concentrated on the negative. And I have been doing basically the same thing the entire time. I even started out with a bus.

So, now we are back on the bus, and having a good time doing it. And, you know, people are entitled to their opinions. But I haven't lost an election yet.

(END VIDEO CLIP)

BASH: Hasn't lost an election yet, John, and really downplay the idea that he might be getting his mojo back, and also the question of whether or not he is getting it back a little bit too late in the game.

He's insisting that he's just sort of steady as she goes here, was asked today whether or not he feels that -- that he has to contrast himself more with the other candidates, or why he would be different from the other candidates. He said, he just -- he just has to make his case that he is -- he said, "I'm me," and that people will understand that, from his perspective, he would be definitely, by far, the best conservative in this race on both social and fiscal issues -- John.

KING: We shall see if it all works out.

Dana Bash with Senator Thompson in Decorah, Iowa. I will get that right yet.

(LAUGHTER)

KING: Dana, thank you very much.

In the "Strategy Session": Mike Huckabee has a message for those criticizing his Christmas ad.

(BEGIN VIDEO CLIP)

MIKE HUCKABEE (R), PRESIDENTIAL CANDIDATE: If we are so politically correct in this country that a person can't say, enough of the nonsense of political attack ads, can we pause for a few days and say merry Christmas to each other, then we are really, really in trouble as a country.

(END VIDEO CLIP)

KING: But has the governor crossed the line by injecting religion into politics?

And Fred Thompson, as you just saw, hasn't given up on Iowa yet. He's in that state campaigning hard. But is it too little, too late? Donna Brazile and Ken Blackwell are right here in THE SITUATION ROOM.

(COMMERCIAL BREAK)

KING: In today's "Strategy Session": When is a bookshelf just a bookshelf? And when is it a subtle message to Christian evangelicals?

A new Christmas ad from Republican presidential hopeful Mike Huckabee is catching some scrutiny and raising some eyebrows.

Joining me here, CNN political analyst and Democratic strategist Donna Brazile and Ken Blackwell. He's with the Coalition For a Conservative Majority and the former secretary of state of the big state and the great state of Ohio.

Thank you both for joining us today.

I want to start by -- and we will it put up on the wall, so, as we talk about it, our viewers can see this, and you can see it. It's a Mike Huckabee ad. He's looking into the camera. He says, oh, you have all had enough of politics. Let's just talk about Christmas a little bit.

And you see what -- behind him now, as you see on the screen, it is a bookcase. But, as it passes over his shoulder, it certainly looks like a cross. And many have said, aha, this is a secret effort to send a message to his base in Iowa, who are Christian evangelicals, a reminder that: I'm with you.

Well, Governor Huckabee was asked about this today, and he said this.

(BEGIN VIDEO CLIP)

HUCKABEE: That was a bookshelf behind me, a bookshelf. And, so, now, I have these people saying, oh, there was a subtle message there.

Actually, I will confess this. If you play the spot backwards, it says: Paul is dead. Paul is dead. Paul is dead.

(LAUGHTER)

HUCKABEE: So, the next thing you will know, somebody will be playing it backwards to find out the subliminal messages that are really there in backmasking. I never cease to be amazed at the -- the manner in which people will try to dissect the simplest messages. You can't even say merry Christmas anymore without somebody getting all upset about it.

(END VIDEO CLIP)

KING: Ken Blackwell, you get it first.

I mean, he is a funny man. That's part of his appeal. But, when you see that ad, and he is talking about Christmas, when you see that, does it jump out at you?

KENNETH BLACKWELL, FORMER OHIO SECRETARY OF STATE: No, it doesn't.

Mike Huckabee is authentic. And I think that is what is part of his attractiveness. He's not contrived. He is comfortable in his own skin. And that was a Christmas message. It was a Christmas message that actually kept Christ in Christmas.

But he understands that, in our constitutional framework, we are a pluralistic society, where we have many religions. But he is, in fact, is a -- is a Baptist minister. And it shouldn't be any surprise to anybody that he -- he says, let's celebrate the birth of Christ.

KING: Is the bookcase just a bookcase? Bookshelf just a bookshelf? When I saw it yesterday, I was struck by it because of the pause of it. They say it is just a coincidence if you see it that way.

We went through this, remember, at the last Republican Convention. Somebody said there was a cross in one of the lecterns of the podium that President Bush was using.

Are we just trying too hard here?

DONNA BRAZILE, CNN POLITICAL ANALYST: Look, Mike Huckabee was trying to send another message. And that was to his opponents that, in his speech during the ad, he said there is no -- this is no time for politics.

He was trying to launch a preemptive strike to Romney and Thompson and others not to use attack ads. He was reminding them that this is the season of giving, this is the season of joy, a season of rejoicing. And, yes, there was a lot of politics in that ad.

(LAUGHTER)

KING: Now, we're -- we are old enough to remember "Paul is dead" going backwards.

So, how much does the humor help him?

BLACKWELL: Well, Mike has a tremendous sense of humor. Hey, it is a human dimension that not everyone can project. I think that's part of his strength is that he can project that human dimension. He is the common man.

But, also, if you take him for granted, he will come up on you, because he is a smart man.

BRAZILE: Look, he is organizing the homeschoolers. He's organizing many of the churches. He needs them to get out to vote for him. This is a net plus for him to be running this ad during this season.

KING: And for us to be talking about it.

BRAZILE: Absolutely.

KING: Let's move on to another candidate.

We just had a piece about Fred Thompson out in Iowa. And he talked to Dana Bash. He says he's going to be on this bus now; he's going to go to 50 cities; he's going to go until the next 15 days, the Iowa caucuses.

Many have been asking -- we have done this in this room before -- where is Fred? Where is Fred? Where is the energy? Where is the passion? Where is the fight?

Ken, you talk to Republicans in Ohio and all across the country, they have been asking that very question. Do you see evidence that this is real?

And, as I ask you, let's look at this, this hill he has to climb. In Iowa, a poll just last week had Fred Thompson at 9 percent, Huckabee and Romney well ahead of him. A national poll, Giuliani, Huckabee, McCain, Thompson down at 14 percent.

Did you see passion? And is it in time?

BLACKWELL: Well, I think you might see passion, but the fact is, if Romney spent 117 days in Iowa since June, and Huckabee 105 days, I think he's -- he's really going to be eating a lot of dust, because these guys are -- really been out there a long time.

BRAZILE: Well, talk about likability. He sees an opening.

With Romney and Huckabee going after each other, What Fred Thompson is trying do is become the second-place finisher. He wants to go up the middle. And I think that's one of the reasons why he is going to hit 54 of the 99 counties over the next couple of days.

KING: Want to close with an issue near and dear to both of your hearts, which is the credibility of the election system.

And, Ken, you were the secretary of state in Ohio. And that system has come under some condemnation. A new study by your successor says that the -- the findings in the study indicate, the computer-based voting systems in Ohio did not meet computer industry security standards, susceptible to breaches of security.

I want you to talk a little about -- a little bit about the Ohio study and whether you think your state, when you were in charge and now, has a voting system that the people can trust.

And then you weigh in on whether you think this is still a national problem.

BLACKWELL: The 88-county Boards of Elections kicked the tires, adopted a new system, both Democrats and Republicans. The system is not perfect, but is substantially better than the system that it replaced.

I think, if you listen to what the academics, the professionals are saying, this is a bit like crying fire in a crowded theater.

KING: And -- and, going forward, are you confident?

BRAZILE: No, I'm not. I don't think we have fixed the problems.

Look, Secretary of State Brunner has identified several problems, including eliminating the direct recording electronic machines. She also believed that we have to give greater access to people to go ahead and have no-excuse absentee ballots.

I think, in a democracy, we should try to encourage every eligible citizen to vote and not have impediments. Look, the voting machines, they are not tabulating. They are not counting accurately. We should not go through a third election where the election is in doubt because of faulty equipment or partisanship in the electoral process.

KING: We need to leave it there for today. We will revisit this issue as well.

Donna Brazile, Ken Blackwell, thanks so much for joining us today in THE SITUATION ROOM.

BRAZILE: Thank you.

KING: A U.S. senator is set to end his years of public service.

(BEGIN VIDEO CLIP)

SEN. TRENT LOTT (R-MS), MINORITY WHIP: I can't help but feel honored and humbled by all that has been said here. My mother would have loved it and would have believed it all.

(END VIDEO CLIP)

(LAUGHTER)

KING: You will see and hear more of how Trent Lott is saying goodbye.

Also, you have heard a lot about using corn to combat high gas prices. But did you know that's what's driving up the cost of another much-used crop?

And Fidel Castro puts out a surprise. After almost five decades, he hints at when he might actually retire.

(COMMERCIAL BREAK)

KING: Checking our Political Ticker: a bipartisan salute on the Senate floor today to Republican Trent Lott, as he prepares to end his long career in Congress.

Listen to these tributes from the Senate Democratic leader, Harry Reid, and Republican Leader Mitch McConnell.

(BEGIN VIDEO CLIP)

SEN. HARRY REID (D-NV), MAJORITY LEADER: Senator Lott, I wish you and your wonderful wife and your family the very best. I believe my dealings with you have made me a better person and better senator.

SEN. MITCH MCCONNELL (R-KY), MINORITY LEADER: We will remember at some point in the days and weeks that follow that mischievous grin, or a heavy slap on the back, or some happy tune we heard him whistle once when he passed us quickly in the hall. And then we will be glad to have served with a man like Trent Lott.

(END VIDEO CLIP)

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

Where does each candidate stand on health care, Iraq, or illegal immigration?

Our Internet reporter, Abbi Tatton, is looking at the candidates in their own words discussing hot-button issues online.

Abbi, tell us what you are finding.

ABBI TATTON, CNN INTERNET REPORTER: John, this is new for voters in this presidential election, thousands of online videos of the candidates talking about where they stand on the different issues.

And there are various Web sites out there going through this wealth of resources to figure this out for the voters, so you can compare the candidates on the issues side by side. YouTube is one of them. They actually went to the candidates on six different issues, including education, immigration, Iraq, and asked them to send in a video of where they stand.

So, if you want to look at Rudy Giuliani on education, this is what his campaign would like you to see. But this online resources, this is out there for everyone. And there are other people going through this material and making up their own Web sites.

Look at this one, expertvoter.org. It's this big video wall of the candidates -- some of them, you know; some of them, maybe you haven't heard of before -- organized by issue. And this is just done by a software engineer in California, Gary Stark, who says he's doing this as a public service.

Of course, we should also point out this one, CNNPolitics.com, where we break down all the candidates by the issue -- John.

KING: Yes, we should point out that one in the end.

(LAUGHTER)

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

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

Hi, Jack.

CAFFERTY: The question this hour: What does it say about the U.S. in 2007 if family values have lost their punch as a campaign issue?

Randall writes: "People have finally figured out that family values was just a red herring, a Republican bumper sticker slogan which was used to keep people from paying attention to the real issues, i.e. the Iraq war, the skyrocketing deficit, the recession we're in, a lack of single-pay health insurance for everyone, and a government that has never worked for the people, but only for the military industrial complex and for big business."

Darach in New Jersey writes: "It means the citizens of this country are looking for a more pragmatic leader, not one who is going to preach to us about our values and what they should be. Leave that to us. We're smart enough to figure that out on our own."

Richard in Alabama writes: "Just look back at what we got in 2000, when the courts gave us a family values president. We just can't afford another eight years of family values."

Paul in Brooklyn: "Hopefully, it says the American public has begun to awake from their slumber and are realizing that saying you are for family values and actually having them are two different things. Maybe having a president who vetoes health care for children, congressmen that cruise airport restrooms and molest children and adolescents, spiritual leaders who do drugs with gay male prostitutes, et cetera, have finally taken their toll. Well, it's the Christmas season. We can hope, can't we?"

Darryl in Oregon: "It says we have finally figured out that family values start with the family, not the government. There's very little government can do to affect family values, although keeping our mothers and fathers home with their families, rather than sending them into a stupid war, might help."

And Mike in New York writes: "The Republican charade is over. We have found they have many families and no values."

(LAUGHTER)

CAFFERTY: John.

KING: Thank you, Jack.

CAFFERTY: You're welcome.

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