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Lou Dobbs Tonight

Russia Invades Republic of Georgia; Senators McCain and Obama both Demand Cease-Fire; Edwards' Sex Scandal; Are Senators Obama and Clinton Burying the Hatchet?; Mexican Troops cross into the U.S.

Aired August 08, 2008 - 19:00   ET

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


KITTY PILGRIM, CNN CORRESPONDENT: Thanks, Wolf.
Tonight much more on John Edwards' admission that he had an extramarital affair after months of denying it.

Also Russia invades one of this country's closest allies, the Republic of Georgia. The fighting is escalating. There are heavy casualties.

And charges that the Bush administration's failure to secure our borders allow Mexican troops to enter this country and hold one of our border patrol agents at gunpoint. All that, all the day's news, much more straight ahead here tonight.

ANNOUNCER: This is LOU DOBBS TONIGHT: news, debate, and opinion for Friday, August 8th. Live from New York, sitting in for Lou Dobbs, Kitty Pilgrim.

PILGRIM: Good evening, everybody. Russian tanks tonight are pushing deep into the Republic of Georgia, a close ally of the United States. Now Russia is invading the Republic after Georgia tried to regain control of the breakaway region of South Ossetia (ph). Casualties are heavy.

One report says at least 1,400 people have already been killed. Georgia's president, Mikhail Saakashvili has declared he is pulling his country's troops out of Iraq to join the fighting. The Pentagon tonight is making plans to evacuate as many as 2,000 American citizens who live in Georgia.

We have extensive coverage. We begin with Jill Dougherty in Washington.

(BEGIN VIDEOTAPE)

JILL DOUGHERTY, CNN CORRESPONDENT (voice-over): Georgia's tiny breakaway region of South Ossetia was like a bomb waiting to explode. Finally it did. Georgia launching a military offensive, it says, is aimed at stopping the separatist region from seceding from Georgia.

Russia sending in tanks to beef up Russian peacekeepers and it says protect civilians in South Ossetia who hold Russian passports. As civilians flee the fighting, Georgian President Mikhail Saakashvili tells CNN it's an invasion and accuses Moscow of aggression and provocation. PRES. MIKHAIL SAAKASHVILI, GEORGIA: It's about fundamental values that U.S. always advocates for the rest of the world. It's about something that is dear to all of us, freedom, democracy and you know and standing up for your own values and principles.

DOUGHERTY: Russian President Dmitry Medvedev claims his tanks are on the move in self-defense.

PRES. DMITRY MEDVEDEV, RUSSIA (through translator): Civilians are dying at the moment in South Ossetia (ph), women, children and old men and the majority of them are citizens of the Russian Federation. I, as president of the Russian Federation, am obliged according to the Constitution and federal law to defend the lives and integrity of Russian citizens wherever they are.

DOUGHERTY: As fighting intensifies, Georgia charges Russian planes are bombing its territory. Both Russia and Georgia were part of the former Soviet Union. Moscow says Georgian forces killed Russian peacekeepers. The escalation is setting off alarm bells internationally. The U.S. says it's dispatching an envoy to Georgia.

ZALMAY KHALILZAD, U.S. AMB. TO U.N.: We call on Russian forces to stop attack whether by aircraft, missiles or ground combat forces.

DOUGHERTY: At the United Nations, Russian and Georgian representatives engage in a heated debate.

UNIDENTIFIED MALE (through translator): Who would object to a cease-fire? Who would object to peace?

VITALY CHURKIN, RUSSIAN AMB. TO U.N. (through translator): Are you ready to stop the fighter jets who are in the air who will soon be bombing my comrades in Georgia?

DOUGHERTY: The European Union urges both sides to declare a cease fire. South Ossetia (ph), one of two breakaway regions in Georgia, declared independence from Georgia but the international community never recognized it. Now, the conflict threatens to spin out of control with wider implications for Russia and the United States.

(END VIDEOTAPE)

DOUGHERTY: And one big question right now is, why now? Why this military conflict at this point? Both sides are pointing the finger saying that the other side started it. The U.S. State Department, by the way, is giving this scenario. They say that the separatists broke the cease-fire, the Georgians moved in and then the Russians moved in -- Kitty?

PILGRIM: You know the chronology of that is very interesting, Jill. But is there any -- it's so stratified now. Is there any possibility of a compromise at this point?

DOUGHERTY: Well it's very, very tense, very fraught situation. And certainly emotions are high in that region. But the one thing that both sides really have to do is call it back as quickly as possible. Stop that violence, because in that area it could very quickly spin out of control.

PILGRIM: Thanks very much, Jill Dougherty. Thanks Jill.

The Republic of Georgia tonight is asking for U.S. help to fly its troops home from Iraq to fight the Russians. Now Barbara Starr reports from the Pentagon -- Barbara.

BARBARA STARR, CNN PENTAGON CORRESPONDENT: This area may be unfamiliar to many Americans but it is strategically very militarily important to the United States. Tonight, the Pentagon is trying to help Georgia get its 2,000 troops out of Iraq, get them back to their country. That's what the Georgian government wants.

They need U.S. airlift to make it happen. So that is first on the table at this hour. How to get those Georgian troops back to their country and out of Iraq. Second, there are 2,000 Americans currently in Georgia at this point. The Pentagon is looking at how to plan to evacuate them if, if it becomes necessary in the days ahead. They say that that is prudent planning.

They don't expect to have to do it at this hour. But I can tell you throughout the weekend, expect to see the Pentagon continue to monitor the situation and the safety of Americans there around the clock. They're about actually 130 U.S. troops in Georgia right now. They're part of a longstanding program the Pentagon has to train and help equip Georgian forces to be able to stand on their own in that region.

The Georgian military is on shaky ground at some points and they're trying to beef it up. Georgia is set to become a member of NATO, and that's very important for the U.S. to have that alliance in that region. That potential NATO membership has been very upsetting to Russia and many U.S. military commanders believe that's part of the reason Russia has made the move at this time to try and block Georgia from being able to join NATO.

And of course, one of the real economic bottom lines, Kitty, is the oil pipelines running through that region, from the Caspian Sea out to the West, this is a very strategically important economic asset and for the U.S. and for the West, top priority is to make sure those oil flows, those oil pipelines and the transit of oil through the region remains safe and secure -- Kitty?

PILGRIM: Barbara, with Georgia aspiring to become a NATO member, we are very closely linked militarily at this point, even though they're not a formal member, correct?

STARR: Oh, absolutely. And of course you know in the NATO alliance, the rule of the game is an attack on one is an attack on all. And that is something, of course, the U.S. is watching very carefully. There is no appetite in the Bush administration at this point to take any action militarily.

They don't want to have to do that. And that, Kitty, is one of the reasons throughout the day you have seen top officials make calls to leaders both in Georgia and Russia. Secretary of State Condoleezza Rice, Defense Secretary Robert Gates and the chairman of the Joint Chiefs of Staff all working the phones all day long -- Kitty.

PILGRIM: Thanks very much, Barbara Starr.

Well President Bush today did hold urgent talks about Georgia with Prime Minister Vladimir Putin of Russia. He held those talks in the Chinese capital of Beijing. Now President Bush spoke with Putin during a luncheon hosted by the Chinese president, Hu Jintao (ph).

The president and Putin are in Beijing for the Olympics, of course. Separately, White House press secretary issued a statement saying "The United States supports Georgia's territorial integrity and we call for an immediate cease fire. We urge all parties to de- escalate the tension and avoid conflict."

Secretary of State Condoleezza Rice today called on Russia to immediately withdraw its troops from Georgia and stop its attacks. Zain Verjee reports from the State Department. Zain, what are the administration officials saying about the Russian offensive tonight?

ZAIN VERJEE, CNN STATE DEPARTMENT CORRESPONDENT: Hi, Kitty. Well the U.S. is saying essentially that this is a really dangerous situation. They're really concerned about this breaking out into an all-out war between Russia and Georgia. Secretary of State Condoleezza Rice, as you say, is calling for Russian troops to just get out. And for all sides just to cease-fire.

She's been working the phones all day to try and get both sides just to stand down. The U.S. has also said, Kitty, that it's going to send an enjoy to the region to mediate. The U.S. ambassador to the United Nations, Zalmay Khalilzad, had this to say about stopping the violence.

(BEGIN VIDEO CLIP)

KHALILZAD: I think almost everyone that has spoken this afternoon has highlighted the importance of ceasing the fighting. Cease-firing. I just noticed that the distinguished representative of Georgia said that Georgia is ready to accept a cease-fire. But the statement from my Russian colleague was silent on the issue of the need for an immediate end to the violence for accepting a cease-fire.

(END VIDEO CLIP)

VERJEE: Kitty, a senior State Department official also gave us a sense of how all of this unfolded. What they're saying was there was a cease-fire (INAUDIBLE) more than 24 hours ago. And then it was the separatist fighters in South Ossetia (ph) that broke it. And Georgia unleashed its troops to try and put that uprising down and then the Russians stepped in, so right now there, as Jill was saying, that there's a blame game going around here, but that's the chronology of events, according to the State Department.

PILGRIM: Zain, as Barbara Starr mentioned also, there's a very strategic oil pipeline (INAUDIBLE) pipe line in that area. Tell us more about the importance of that.

VERJEE: It's a really significant and a key thing to understand in this story. It's very strategic -- Georgia is a key transit point of oil, a very practical route that essentially bypasses Russia and Iran. So the U.S. doesn't have to depend on those sorts of routes. There's a pipeline, as you see there, that goes from (INAUDIBLE) all the way to Russia -- sorry, all the way to Turkey which is where it's loaded and shipped.

The oil is then sent to Europe and the United States. And it has to go through Georgia, only a few miles, in fact, from the South Ossetia (ph) region. So it's a very, very critical thing. And it's something that the U.S. is very aware of.

PILGRIM: Zain, there's also -- the U.S. and Georgia, as we mentioned before, have a very strong relationship. What are the other alliance issues that come into play here in this region?

VERJEE: Well, Georgia, for the U.S., has really been seen by President Bush as a symbol of democracy, really, in the region. President Bush has praised the efforts of Mikhail Saakashvili (ph) in Georgia. The other alliance is really with NATO. The U.S. has been pushing for NATO membership for Georgia and as Barbara Starr pointed out that the Russians just don't like that.

The important thing here is that Russia in this situation may just be trying to show that the U.S. just can't come and do anything it wants in this region without considering Russia's interests in Russia's own backyard. So Georgia is really sort of becoming a battleground for influence in the region, a battle between the U.S. and Russia.

PILGRIM: Thanks very much, Zain Verjee. Thank you, Zain.

Well Senators Obama and McCain were quick to condemn Russia's invasion of Georgia. Now both candidates seeing an opportunity to demonstrate that they have the credentials to be commander in chief. Ed Henry reports from Washington -- Ed.

ED HENRY, CNN WHITE HOUSE CORRESPONDENT: Kitty, that's exactly what is at work here right now. John McCain and Barack Obama seeing this foreign policy crisis and sensing an opportunity to try and prove that they would be up to the job of president.

As you know, John McCain throughout this campaign has been touting his national security credentials, being a senior member of the Senate Armed Services Committee, being a military veteran. And he's been very aggressive in his campaign ads and charging that Barack Obama does not have the experience to be commander in chief.

Obama of course has been firing back that it's not just about experiencing, checking boxes on a resume, that judgment is more important and he cites the war in Iraq as exhibit A in that. Given all of those charges flying around in this campaign, it's no surprise that very quickly after this crisis both men jumped in to comment.

(BEGIN VIDEO CLIP)

SEN. JOHN MCCAIN (R-AZ), PRESIDENTIAL CANDIDATE: The government of Georgia has called for a cease-fire and for a resumption of direct talks on South Ossetia (ph) with international mediators. The U.S. should immediately convene an emergency session of the United Nations Security Council to call on Russia to reverse course.

SEN. BARACK OBAMA (D-IL), PRESIDENTIAL CANDIDATE: I think it's very important for the United States to work with the U.N. Security Council and others in the international community to make sure that we are beginning to bring this conflict to a close. This is a volatile situation. Obviously we're getting updated on a regular basis, but what is clear is that Russia has invaded Georgia sovereign, has encroached on Georgia's sovereignty.

(END VIDEO CLIP)

HENRY: Really a rare example in this heated campaign where the two candidates really are not that far apart. Basically both of them calling for the violence to be tamped out and the diplomacy on all sides to be increased. That's not really shocking because while they both want to jump in, neither one obviously as president, there's not really much as candidates that they can do other than try and make some public comments -- Kitty.

PILGRIM: All right, thanks very much. Ed Henry.

Let's turn now to the war -- and we'll have more on this developing story. But let's turn to the war in Iraq right now. Two more of our troops have been killed in what is being called a non- combat incident.

Nine of our troops have been killed in Iraq so far this month, only two of them in combat. We have 4,136 troops have been killed since the war began; 30,490 troops wounded; 13,530 of them seriously.

Well insurgents today killed 21 Iraqis in a bomb attack in a crowded market in northern Iraq. Now this attack took place in the city of Tal Afar. At least 50 people were wounded. The attack coming despite recent security gains in northern Iraq.

Stunning news about former presidential candidate John Edwards, Edwards admitting he lied about having an extramarital affair. We'll have full coverage ahead.

(COMMERCIAL BREAK)

PILGRIM: We have breaking news to report tonight. Former senator and presidential candidate John Edwards is finally coming clean about an extramarital affair. After repeated denials, Edwards now admits he made a serious error in judgment but still he dismisses allegations that he is the father of the woman's child and he says he is willing to take a paternity test. Brian Todd has more of the story.

(BEGIN VIDEOTAPE) BRIAN TODD, CNN CORRESPONDENT (voice-over): Under increasing pressure from a story that had gone beyond the tabloids to serious discussion among Democratic Party chiefs, the former presidential candidate admits he had an affair with a woman who'd worked on his campaign.

In a statement, John Edwards says he's ashamed and, quote, "in 2006, I made a serious error in judgment and conducted myself in a way that was disloyal to my family and to my core beliefs. I recognized my mistake and I told my wife that I had a liaison with another woman and I asked for her forgiveness."

But Edward denies he's the father of that woman's child and says he's willing to take a paternity test. During his presidential campaign this year, Edwards repeatedly denied that there was any truth to the story, initially calling it false and ridiculous. He issued another denial just two weeks ago.

UNIDENTIFIED FEMALE: Senator, I have a question, when you were running for president, you flat-out denied having a relationship with Rielle Hunter (ph). Is -- did you give me a truthful answer? Were you telling the truth then?

JOHN EDWARDS (D), FORMER PRESIDENTIAL CANDIDATE: Yes.

UNIDENTIFIED FEMALE: Has you or your campaign provided any financial support to Rielle Hunter or Andrew Young (ph)? Has you or your anyone affiliate with your presidential campaign provided any financial help to Rielle Hunter or Andrew Young (ph)?

EDWARDS: I have no idea what you're asking about. I've responded to -- consistently to these tabloid allegations by saying I don't respond to these lies. And you know that (INAUDIBLE) you've covered me and I stand by that.

TODD: The woman, Rielle Hunter, worked for Edwards as a freelancer making Web videos. She told the program "Extra" about her travels with Edwards.

RIELLE HUNTER, FORMER EDWARDS CAMPAIGN WORKER: One of the great things about John Edwards is that he's so open and willing to try new things and do things in new ways.

TODD: Edwards says his wife, Elizabeth, became aware of the relationship in 2006 not long after it began. Edwards reportedly tells ABC News that his wife's cancer was in remission when he began the affair. Elizabeth Edwards has since then developed an incurable form of cancer.

(END VIDEOTAPE)

TODD: Government records show Edwards' political action committee paid a total of about $114,000 to Hunter's production company for Web site and Internet services. CNN has tried to talk to Rielle Hunter for weeks about the story, but without success -- Kitty.

PILGRIM: Brian, hasn't another former Edwards' staffer come forward and said he is the father of the child.

TODD: That's right. Published reports say a former Edwards' staffer named Andrew Young has claimed paternity of this child, but some newspapers have posted the birth certificate and the father's name is not listed on that, so that just fuels speculation about who is indeed the father.

PILGRIM: Thanks very much, Brian Todd.

Well there is obviously a lot more to talk about here. In a moment some of the most astute political observers in America will take up this topic from the political fallout of today's admission by Edwards and what that means for the Democratic Party.

But before we get to that, Senator Hillary Clinton is campaigning for Barack Obama today in Las Vegas. Now this is her first time out campaigning solo for the presumptive nominee. And it might look like the hatchet has been buried. But some of Clinton's supporters feel otherwise. Jessica Yellin reports.

(BEGIN VIDEOTAPE)

UNIDENTIFIED GROUP: (INAUDIBLE)

HILLARY RODHAM CLINTON (D-NY), FORMER PRESIDENTIAL CANDIDATE: Thank you -- thank you all.

JESSICA YELLIN, CNN CONGRESSIONAL CORRESPONDENT: Senator Clinton campaigning for Barack Obama in Las Vegas.

H. CLINTON: He represents the unity that we will have as we move toward victory in November and elect Senator Barack Obama the next president of the United States.

(APPLAUSE)

YELLIN: Before leaving for Hawaii, Obama insisted there's peace between the Democratic Party's top stars.

OBAMA: She is very enthusiastic about the need for a unified party. I think we're going to have a terrific convention.

UNIDENTIFIED FEMALE: We want Hillary...

YELLIN: Not if some of Clinton's most ardent supporters have their way.

UNIDENTIFIED GROUP: Yes we can. Yes we can.

YELLIN: Some Hillary holdouts still active through Web sites like this one say they won't vote for Obama at the convention and a few are even developing a documentary arguing that the primary was stolen. This trailer is on YouTube.

UNIDENTIFIED FEMALE: The people from the Obama group were on telephones, taking down names and addresses...

YELLIN: These vocal Hillary devotees could pose problems for the party.

ANNE KORNBLUT, WASHINGTON POST: I think they absolutely matter in terms of the spirit of the convention, I have heard some Republicans talk about being heartened by the fact that there's still this impression the Democratic Party isn't united.

YELLIN: But a recent poll by the Pew Research Center shows Obama has actually gained support among Clinton's backers, 72 percent in late July, up 13 points since May. Still 17 percent of Clinton supporters say they plan to vote for McCain, and 10 percent remain undecided.

Obama and the DNC have tried to appease these critics with convention speaking roles for both Clintons and by inserting in the proposed party platform a message that says, "We believe standing up for our country means standing up against sexism." It is unclear how significant Clinton holdouts' influence will be come November.

UNIDENTIFIED FEMALE: I don't know that any one demographic could single-handedly sink or -- or win this election for anybody else. I do think it's one of the danger spots for Obama in this election, in states in particular like Florida.

YELLIN (on camera): The Obama campaign insists they're not worried about these Clinton holdouts. They maintain that their influence is dramatically overstated by the media. Some Clinton loyalists also say these folks will eventually move on and support Barack Obama, they just need time, as one person put it, to heal -- Kitty.

(END VIDEOTAPE)

PILGRIM: Thank you Jessica. Jessica Yellin reporting from Washington.

Now armed Mexican troops are now crossing our southern border at will. One Congressman says enforcing a two-year-old law could prevent those incursions. I'll have a report.

(COMMERCIAL BREAK)

PILGRIM: More on John Edwards' stunning admission he had an extramarital affair. We'll examine the political fallout coming up.

(COMMERCIAL BREAK)

PILGRIM: New outrage tonight over an event we reported on earlier this week. Mexican troops Sunday crossed into the United States and detained a U.S. border patrol agent at gunpoint. And now, a U.S. Congressman says the incident might not have occurred if the Bush administration implemented a law passed two years ago. Casey Wian reports.

(BEGIN VIDEOTAPE) CASEY WIAN, CNN CORRESPONDENT (voice-over): In the Arizona desert south of Oahu (ph) Sunday, armed Mexican troops crossed the U.S. border and for several minutes held a U.S. border patrol agent at gunpoint. The border patrol says Mexican troops have crossed the U.S. border illegally 42 times this year.

And more than 300 times since 1996. The U.S. State Department says the latest incident occurred because of, quote, "a momentary misunderstanding as to the exact location of the U.S. Mexican border". The border patrol union strongly disagrees.

EDWARD TUFFLY, BORDER PATROL COUNCIL: The border is marked down there. They jumped over a barbed wire fence 90 feet to the west of where they came in, there is a large vehicle barrier. And we don't understand why this continually goes on. And every time it happens, it's a misunderstanding. We don't think it's a misunderstanding. We think it's a crime.

WIAN: U.S. Congressman Duncan Hunter Friday wrote to the secretaries of Homeland Security and State demanding to know what action is being taken to stop Mexican military incursions. He says the recent Arizona incursion wouldn't have happened if the Bush administration had simply complied with the Secure Fence Act of 2006.

It mandated 700 miles of double-layered fencing be built along the border, including the area where the Mexican military crossed last weekend, by May of 2008. Last year, the White House and Congress scaled back the fence construction plans to 370 miles by the end of this year.

REP. DUNCAN HUNTER (R-CA), HOUSE ARMED SERVICES COMMITTEE CHAIRMAN: Unless you really build a border, you always leave plausible deniably for the other guys, for the people on the south side of the border including elements of the Mexican military that assist the drug trade to come across and claim that they simply made a mistake.

WIAN: The Mexican embassy says in a statement "Law enforcement operations have led, from time to time, to innocent incursions by both U.S. and Mexican law enforcement personnel and military units into the territory of both nations."

(END VIDEOTAPE)

WIAN: a spokesman for the border patrol says its investigation into the incident has determined that there is now no question Mexican troops were, in fact, inside the United States. The border patrol adds that it is still, quote, "working with the Mexican government to ensure that this ceases to occur" -- Kitty?

PILGRIM: Thanks very much, Casey Wian. Well that does brings us to our poll tonight. Do you think that the tepid response from the U.S. State Department that the border incursion was quote, "a momentary misunderstanding as to the exact location" of the border is encouraging more incursions by the Mexican military? Yes or no. Cast your vote at loudobbs.com. We'll bring you the results a little bit later in the broadcast.

A close U.S. ally is invaded by Russia. Will the conflict in the Republic of the Georgia escalate into a war involving the United States? We'll examine the risks and the dangers next.

(COMMERCIAL BREAK)

PILGRIM: The president of the Republic of Georgia tonight is preparing to declare martial law, this after Russia invaded his country. Russian tanks crossed the border after Georgia tried to gain control of the breakaway region of South Ossetia.

Now, there's heavy fighting in South Ossetia right now. One report says as many as 1,400 people have been killed. The Georgian president accused Russia of aggression.

(BEGIN VIDEO CLIP)

MIKHAIL SAAKASHVILI, PRESIDENT OF GEORGIA: Georgia has no interest in hostilities right now. We are in a situation of self- defense. Our troops are holding well. But this is the last thing we want to have, to continue this trouble.

(END VIDEO CLIP)

PILGRIM: The United States has called for an immediate cease- fire. It's demanding Russia end its air and missile attacks and withdraw its troops.

Joining me now is David Satter of the Hoover Institution. He is one of the country's leading authorities on Russia. He's an author of "Darkness at Dawn: The Rise of the Russian Criminal State."

David, thank you for joining us this evening.

DAVID SATTER, HOOVER INSTITUTION: Oh, I'm glad to be here.

PILGRIM: Tensions have been building in the area for quite some time. Now we see this rapid escalation to basically the brink of war. What's your assessment of the situation?

SATTER: Well, it seems it's no longer the brink of war, but actually war's broken out.

It is a question, it seems to me, whether the conflict can be contained as it ought to be. It's really what has happened is that Georgia has tried to regain territory that was part of the Republic of Georgia when Georgia was part of the Soviet Union.

And those boundaries were recognized as international boundaries when the Soviet Union broke up. So, whatever the merits of the Georgian case vs. the South Ossetian case, one wonders why Russia should be involved in this situation. What business is it of theirs?

PILGRIM: Certainly. I would like to actually read a statement from the White House today.

President Bush's press secretary, Dana Perino, released this statement. And it reads: "President Bush has been regularly updated on the situation. I want to reiterate on his behalf that the United States supports Georgia's territorial integrity. And we call for an immediate cease-fire."

What does that this mean for Americans sitting around their TVs tonight listening to this? What does this mean in terms of the U.S. involvement?

SATTER: Well, the U.S. involvement is at a fairly low level. The United States has been training the Georgian army, and that's one of the reasons it may not be so easy for the Russians.

There's only one road that leads into South Ossetia, over the mountains from Russia. And it's not going to be a simple matter for Russia to move troops into the area, take it over and defeat the Georgian army, if that's their intention.

But it seems to me unlikely that the United States itself will get involved in the conflict, aside from offering diplomatic support, which of course is very necessary and probably quite welcomed by the Georgians.

PILGRIM: Georgia is a key ally in the region. U.S. interests, are they at stake here?

SATTER: Well, they are at stake, but not so much because Georgia is a key ally.

Georgia is rather remote from the really key problems that the United States faces right now. It's a question of principle, actually. Russia is fond of saying that Georgia is in our backyard. Georgia is in our neighborhood.

Well, it's reasonable to ask, what difference does that make? Lots of countries -- maybe the Georgians consider that Russia is in their backyard. The fact is that, either way, these are independent countries that have the right to chart their own future and make their own decisions.

PILGRIM: But, you know, Georgia has sought to join NATO and has moved very strongly towards Western influences. So, is this a test case with Russia? There have been enormous tensions with Russia and the United States in recent months. Is this a symptom of it?

SATTER: Well, it could be that the failure to begin the process of welcoming Georgia into NATO was one of the things that encouraged Russia to act as it has before Georgia makes too much progress in the direction of becoming part of the Western alliance and the costs of aggression would correspondingly increase.

PILGRIM: How worrisome is it that Russia's being so aggressive? I would like to actually bring up a comment made by Georgia's president, Saakashvili. He made this comment today. And let's listen to it for a second.

(BEGIN VIDEO CLIP)

SAAKASHVILI: This is an issue of a big country trying to destroy a small country, trying to bring to the knees small country by military means. And that has happened before. Old habits die hard, and it's very unfortunate it's coming back.

(END VIDEO CLIP)

PILGRIM: These are strong statements. This is a strong, aggressive act on the part of Russia.

How do you assess this?

SATTER: Well, this demonstrates more than anything else that the Soviet mentality still exists in Russia. Soviet Union has disappeared, as a country, but the mentality of the Soviet system still exists.

Russia doesn't recognize Georgia as a fully independent country. It understands Georgia as a country which should be subservient to Russia. There's no reason why the rest of the world should go along with such a distorted interpretation.

PILGRIM: All right, thank you very much for your analysis this evening. David Satter, thank you.

The political fallout from the John Edwards sex scandal, how will Edwards' admission of an extramarital affair impact the Democratic Convention? We will have three of the best political analysts in the country. They will be here next for more and all the day's political news.

So, stay with us.

(COMMERCIAL BREAK)

PILGRIM: Joining me now to talk about the impact the John Edwards sex scandal will have on the Democratic Convention and his political future, we have three of the best political analysts in the country and CNN contributors, all of them.

We have Republican strategist Ed Rollins. Ed was White House political director under President Reagan. And he recently chaired Mike Huckabee's campaign for president. We have syndicated columnist Miguel Perez, and Democratic Strategist Robert Zimmerman. Robert is a Democratic Committeeman for New York. He's also a Barack Obama supporter.

Gentlemen, thanks for being with us.

We have quite a bit of news today with John Edwards, something that no one expected. It is a surprise. How much of a problem is this for the Democratic Party?

Ed, let me start with you.

ED ROLLINS, CNN SENIOR POLITICAL CONTRIBUTOR: I don't think it's a problem for the Democratic Party. It's certainly a problem for John Edwards.

And I think the critical thing here, the stupidity of this man is beyond anything that I have seen in a long, long time. The first thing you want in a man who is running for president -- and he ran twice for president, and was a vice presidential candidate -- is you want judgment. He clearly showed no judgment.

You want some sort of a moral integrity. He certainly doesn't have a moral integrity. And the third thing, you want someone who tells the truth. And obviously he doesn't tell the truth. So, I think he's done. I think he might as well just go home, take care of his dying wife, who is the real tragedy in all of this, and we just say, thank you very much.

PILGRIM: Ed, I have to ask you, with your experience on the campaign trail, the microscope under which any candidate is put, there's certainly nothing that you would be able to really hide in the course of a campaign.

ROLLINS: You can't hide when you have got hundreds of reporters following you, you have got tons of staffers, young staffers, who basically hold you in this position of adulation.

And I think to a certain -- we're all human. But you just basically have to put yourself with a discipline when you're running for office.

PILGRIM: Miguel, thoughts on this? Also, Edwards has endorsed Barack Obama. How does this factor in to this?

MIGUEL PEREZ, SYNDICATED COLUMNIST: I differ with that a little bit in terms I think it will have harm the Democrats a little bit, especially if it goes on and on. He's still denying that the child is his. This is going to carry for a few days, maybe a few weeks, perhaps even up to the Democratic Convention. He's taking the public opinion away from the issues and the things that Obama wants to be discussing.

PILGRIM: Oh, I would say so.

PEREZ: And so it does point -- shine a very bright light on the Democrats.

ROBERT ZIMMERMAN, CNN POLITICAL CONTRIBUTOR: I would disagree. I don't see it as a partisan issue. This is not a scandal that is unique to one party.

But I do agree with Miguel in this context, and that is that John Edwards' statement itself was a certainly unchivalrous statement and it just left open more questions than it provided answers. And so from that context, this story tragically will continue. And it not only is a tragedy for his family. It's also a tragedy for so many of his supporters and so many people who share his beliefs and his views, myself amongst them. Edwards was in a unique role to in fact focus on poverty the way Al Gore focused on global warming. In fact, he was in Los Angeles working on a documentary to try to accomplish the same things as "An Inconvenient Truth."

And the reality is, he's now betrayed his supporters, not just his family, and destroyed all his credibility in terms of really speaking out effectively on issues.

ROLLINS: He can name the documentary "Inconvenient 2," "Inconvenient Truth 2."

(LAUGHTER)

(CROSSTALK)

PILGRIM: But this raises an interesting point. Although his personal life is under some criticism at this point, does it discredit all his political ideas at this point?

ZIMMERMAN: Well, I think it discredits him as an advocate for these ideals. And , in many ways, the causes he's associated with have been set back. And that's just travesty unto itself.

Certainly, it's going to continue to be a problem that is going to not just confront him, but it's also going to confront so many supporters of his. They will be discouraged. Hopefully, they will stay active and involved and will not let their mission and political action be defined by his conduct.

PILGRIM: Miguel?

PEREZ: Imagine if Barack Obama had already named him as his vice presidential...

PILGRIM: Yes.

PEREZ: This guy was being named as potential attorney general or a Supreme Court justice. All of this, a major disappointment for the Democrats.

You have to wonder what makes these guys play with fire this way. You're running for the highest office in the world. Don't you want to be Mr. Clean, at least for a little while?

(CROSSTALK)

ROLLINS: In addition to that, this affair went on in 2006. He claims he told his wife in 2006. This was long before he began -- if he did this understanding the environment he was getting into, he shouldn't have run for president.

PILGRIM: That's actually the question I wanted to ask you. Does the candidate have an obligation to the public and to their party to actually come clean with anything that could be in their background that might cause a basic scandal?

PEREZ: Obama probably would have asked him that question. Is there something in your past that's going to hurt me? That's a question you ask all the vice presidential candidates.

ZIMMERMAN: Ed has certainly been the leaders in national campaigns and certainly understands, as I do from my national campaign experience, you go into every national campaign knowing this is going to be the focus of your opposition.

And the opposition research is going to be -- in fact, most campaigns do their own opposition research on themselves just to make sure that nothing can come out. So, clearly, it's going to be an issue.

But it goes back to Ed's point, which I think is a very important one. It's a question of character. After the 2004 election, when a lot of Democrats really went after John Kerry, he was very restrained and showed enormous dignity.

Unfortunately, John Edwards and many of his people also took shots at John, made attacks at John Kerry. And I think the Kerry people, to their credit, showed great restraint. So, I think there's a real character issue here. I saw this in the 2004 race in the way Edwards conducted himself in the aftermath and now here.

PILGRIM: Now, the other question that's really hanging over this entire situation is this has been in the tabloid media for quite a few months, almost a year. Is there a sort of split between mainstream press that will not push too hard on these sort of issues and the tabloid press?

PEREZ: Because "The National Enquirer" is carrying a story, that doesn't make it a lie. In this case, the mainstream media should have followed this story and I think there's a reluctance in the mainstream media to follow the stories that are started or are pursued by the tabloid media. And in this case, mainstream media was wrong and "The National Enquirer" was right.

ROLLINS: Especially when it relates to sex.

For whatever reasons, the Clinton issues, or whatever, they don't want to go there. And it's more than sex. It's about character. And I think here was a guy who, as a couple, and she's an extraordinary woman, who obviously is going through not only the tragedy of suffering with cancer, but the great pain and anguish and humiliation, that she has -- everything that she was about as a champion for women, fighting cancer and what have you, now it's all made it to be hypocrisy.

ZIMMERMAN: Well, that's the interesting point.

I think, ultimately, what really held off I think many in the mainstream media from pursuing this -- and they were certainly watching it and certainly doing the research -- was the fact that because of Mrs. Edwards' condition. PILGRIM: Well, I was sort of going there, that there's a certain reticence on the part of the press to actually push on that too hard on that, relationships, perhaps, because of -- and the very, very visible press conference that was held by John Edwards when he was running for president.

ROLLINS: That's right.

PEREZ: By the same token, then you could argue that Mr. Edwards was taking advantage of that situation? That's a problem, too.

PILGRIM: Yes. Yes.

Gentlemen, should we move on to talking about some of the other issues in the campaign? We still have the issue of Senator McCain. He's launching a new attack ad on Senator Obama, talking about taxes and the middle class. How effective do you think this is? And this is a week for attack ads, it seems.

ZIMMERMAN: Well, it's been a big week for Paris Hilton. She had the best political spot so far this season.

But I think what's interesting about it is, the McCain tactic has been an effective one for two reasons, first of all, the enormous free media it's generated. In fact, by running this ad on YouTube, by circulating amongst the media, every time they tell the story, they have got to reshow the ad.

And I think the Obama campaign, which is a very skilled, disciplined campaign, has got to focus more on keeping the message on their attack on McCain, as opposed to responding to the attacks and responding to the ads, because every time politically you respond to an ad, the media's got to show that ad yet again.

PILGRIM: Right. That's a fair point.

Ed, thoughts on this?

ROLLINS: I think McCain had to do what he did last week. I think if he runs this kind of a campaign -- because he wasn't getting any attention. The media wasn't paying a bit of attention to him. And obviously he was very resentful of that, having been loved by the media in 2000.

But more important, I think the danger here is a "TIME" magazine poll, 65 percent find Obama more likable -- 20 percent find McCain that, big gap on the likability. The more you attack, the more unliked you are, the more your own negatives go up. And John McCain is not going to win as a grumpy old man.

John McCain has basically got to be a substantive person who can be the commander in chief and say, this is a nice young man I'm running against who gives great speeches, but is not ready for prime time.

PILGRIM: It has to be on substance. ZIMMERMAN: That's the great conflict, because in the same way McCain wants to define himself as a maverick and not like Bush, he's very much running the type of Bush campaign -- he's running very much now the campaign that Bush ran against him in 2000.

And where Barack Obama is talking about big ideas, he can't be caught up in being too negative himself.

PILGRIM: Miguel, you get the last word.

PEREZ: By the same token, McCain has to be very careful that he's factual in his attacks, because assuring everybody that $42,000 a year, you're going to be taxed additional taxing from Obama I think is wrong. There's no basis for that.

Obama is going to tax the hell out of all of us, but I don't think those who are making $42,000.

PILGRIM: I think factual accuracy is required in all aspects of all politicians' lives.

ZIMMERMAN: Especially Miguel's comment about the taxes Obama is putting on the American people. It's just the top 3 percent, Miguel. Let's put it in perspective.

PEREZ: We will see. We will see about that when it happens.

ZIMMERMAN: Well, we see what Bush's economics record have brought to this country. And John McCain is championing it.

ROLLINS: But the point I think which is very important, in the mainstream media, you have to make sure these ads are accurate, and if they're not, they have an obligation to basically -- because you can go out and spend millions and millions of dollars and drive this message that's not true.

PILGRIM: Gentlemen, Ed Rollins, Miguel Perez, Robert Zimmerman, always a pleasure.

Coming up at the top of the hour, "ELECTION CENTER WITH CAMPBELL BROWN."

Campbell, who are you working on?

CAMPBELL BROWN, CNN ANCHOR: Well, more of what you have been talking about, Kitty, more breaking news on the John Edwards sex scandal. We are going to talk about why he ran for president knowing that he was going to have to keep this secret. We will tell you the story of how this story broke and who broke it, and we will tell you about Rielle Hunter, who is she, how did she get involved with John Edwards, plus, of course, the political implications not only for him, but for the Democratic Party.

We have got all that, the very latest, no bias, no bull, coming up.

PILGRIM: Thanks, Campbell.

A reminder now to vote in tonight's poll. Do you think the tepid response from the U.S. State Department that the border incursion was a momentary misunderstanding as to the exact location of the border is encouraging more incursions by the Mexican military? Yes or no. Cast your vote at LouDobbs.com. We will bring you the results in just a few minutes.

Please join Lou on the radio Monday through Friday for "The Lou Dobbs Show." Go to LouDobbsRadio.com to find the local listings for "The Lou Dobbs Show" on the radio.

The candidates tackle one of the most important issues facing middle class families. We will tell you what it could mean for your family next.

(COMMERCIAL BREAK)

PILGRIM: Oil prices plunge nearly $5 today to $115 a barrel. Gas prices also continuing their decline. The average price for a gallon of regular unleaded fell for the 22nd straight day, $3.84 a gallon. That's down 27 cents from the record high of $4.11 a gallon on July 17, but still $1 more than it was a year ago. Now, 10 states are now averaging more than $4 a gallon for gas.

Middle class families are already battling those high fuel prices, rising food prices, the housing crisis, and now presidential candidates are battling over another issue critically important to middle class families, taxes.

And as Bill Tucker reports, taxes are becoming a growing burden on American families.

(BEGIN VIDEOTAPE)

BILL TUCKER, CNN CORRESPONDENT (voice-over): John McCain's newest campaign ad hits hard on the issue of taxes.

(BEGIN VIDEO CLIP, MCCAIN CAMPAIGN AD)

NARRATOR: He promises more taxes.

(END VIDEO CLIP)

TUCKER: A new study by one of the nation's oldest nonpartisan tax policy groups, the Tax Foundation, suggests the topic might be right on point.

SCOTT HODGE, THE TAX FOUNDATION: This year, the overall tax burden in the United States has gone up just slightly. Americans will spend this year more on taxes than they will spend on food, clothing, and shelter combined.

TUCKER: The Tax Foundation says that on average almost 10 percent of our income will go to paying state and local taxes. The burden is the worst in the Northeast. The top three states taking the most money from the pockets of their residents, New Jersey, New York, and Connecticut, New Jersey residents paying just about 12 percent of their income to state and local taxes.

HODGE: States ought to be very cautious about raising taxes when the economy is at its weakest right now, when Americans are facing $4 per gallon gasoline, when they're seeing the price of their basic foodstuffs go up. The American family is really feeling pinched right now.

TUCKER: Alaskans pay the least, according to the Tax Foundation, 6.4 percent. But Nevada residents are close at 6.6 percent.

(END VIDEOTAPE)

TUCKER: Now, there's no denying that taxes feel very personal and few people will admit to liking to pay taxes, but according to the Organization For Economic Cooperation and Development, in terms of overall taxes in the developed world, only the Koreans and Mexicans pay less in income tax than we do -- Kitty.

PILGRIM: That's reassuring. Thanks very much, Bill Tucker.

Well, a badly wounded Army sergeant prepares for his next mission. We introduce you to Staff Sergeant John Aughtman next.

Stay with us.

(COMMERCIAL BREAK)

PILGRIM: And now "Heroes." It's our tribute to the men and women who serve this country in uniform.

Tonight, we introduce you to Army Staff Sergeant John Aughtman. Sergeant Aughtman joined the Army right after graduating from high school. And this highly decorated sergeant suffered brain injuries and lost most of his hearing in an attack while serving in Iraq. But Sergeant Aughtman is not letting those wounds stop him from pursuing new career goals.

(BEGIN VIDEOTAPE)

PILGRIM (voice-over): Staff Sergeant John Aughtman joined the Army in June 2001 because he wanted to see the world from the air.

STAFF SERGEANT JOHN AUGHTMAN, U.S. ARMY: I wanted to jump out of airplanes. That was a big thing for me, so I went to airborne school.

PILGRIM: But at the age of 19, the Army sent him off to fight in Afghanistan as an Army sniper.

AUGHTMAN: We would search for weapons and search for traces of al Qaeda and terroristic groups. There was probably mortar fire on a week-to-week basis.

PILGRIM: His tour in Afghanistan was followed by two more deployments in Iraq. AUGHTMAN: We were doing more operations, more into going out and doing missions. It was pretty much an everyday occurrence as opposed to the way it was before.

PILGRIM: On April 22, 2007, a routine mission escorting civilians turned deadly when his vehicle was hit by a grenade.

AUGHTMAN: I was pretty much knocked unconscious for about a minute-and-a-half, but I saw a flash, and then everything went black. I took shrapnel to the right side of my face. I lost about 90 percent hearing in my right ear. Two of my vertebrae in my neck were cracked. And I had a traumatic brain injury.

PILGRIM: Sergeant Aughtman has been undergoing treatment since he was wounded last year. He's now preparing for what he hopes will be his next mission, serving as a member of the U.S. Army's parachute team, the Golden Knights.

AUGHTMAN: It will be a great platform for me to tell my story and tell people about my experiences in the Army, not to mention I get to jump out of airplanes. And it's awesome, you know? It's great.

(END VIDEOTAPE)

PILGRIM: Sergeant Aughtman has received the Purple Heart, a Bronze Star, and an Army Commendation Medal with Honor for his brave service to this country. And we wish him every success.

Tonight's poll, 89 percent of you think the tepid response from the U.S. State Department that the border incursion was a momentary misunderstanding as to the exact location of the border is encouraging more incursions by the Mexican military.

Thanks for being with us tonight. Good night from New York.

The "ELECTION CENTER" starts right now with Campbell Brown -- Campbell.

BROWN: Thanks, Kitty.