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CNN Late Edition with Wolf Blitzer

Interview With Husain Haqqani; Interview With Maj. Gen. Mark Hertling

Aired November 30, 2008 - 10:00   ET

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

WOLF BLITZER, HOST: This is LATE EDITION, the last word in Sunday talk.
(BEGIN VIDEOTAPE)

BLITZER (voice-over): Terror in India. A three-day rampage by gunmen leaves nearly 200 people dead and hundreds more injured. Do the attackers have links to neighboring Pakistan? We'll talk with Pakistan's ambassador to the United States Husain Haqqani.

What do the Mumbai attacks say about where the war on terror stands? Democratic Senator Robert Menendez and Republican Senator Arlen Specter weigh in.

An insight from four terrorism experts.

Bailing out the big three.

BARACK OBAMA, PRESIDENT-ELECT: You can't just write a blank check to the auto industry.

What's at stake for the industry's workers? United Auto Workers Union President Ron Gettelfinger joins us for an interview.

President-elect Barack Obama unveils his economic team and prepares to introduce key national security appointments. We'll assess the transition to power with James Carville, Ed Rollins, David Gergen and the best political team on television.

Plus --

PRESIDENT GEORGE W. BUSH: War in Iraq is not over. We're drawing closer to the day when our troops can come home.

BLITZER: A progress report from one of the top U.S. commanders in Iraq, Major General Mark Hertling. The first hour of LATE EDITION begins right now.

(END VIDEOTAPE)

BLITZER: It's 11:00 a.m. here in Washington, 9:30 p.m. in Mumbai, India, 7 p.m. in Baghdad. Wherever you're watching from around the world, thanks very much for joining us for LATE EDITION.

The siege is now over, but the investigation is only just beginning into that three-day terror attack in Mumbai that left 183 people dead and 273 people injured. Our senior international correspondent Nic Robertson is in Mumbai. He has more on the investigation. What do we know, Nic, at this point?

ROBERTSON: Wolf, 11 of the attackers were killed, but the biggest lead in the investigation is the fact that the police have one of the attackers alive and they're questioning him.

They say that he is a Pakistani. Our sister network CNN IBN has been talking to intelligence sources that they have. They're being told that this Pakistani claims that he was trained in Pakistan by a terror group in Pakistan, that he'd come to India to perpetrate this attack, that they have been told to study Google Earth maps so they would know their way around Mumbai when they arrived here.

They arrived, some of the attackers arrived by boat. It's still not clear had that boat come directly from Pakistan or had they spent some time out at sea.

But the intelligence officials are also telling our sister network that there was a reconnaissance team from the same terror group in Pakistan that came to Mumbai several months ago. They recognized the area, recognized the locations they wanted to target. Those two members of that terror group are still believed to be on the loose in that the country at this time.

We also found out from our sister network CNN IBN their intelligence sources telling them, again, that those intelligence sources telling them that they believe there was a credible warning given by United States authorities to Pakistani officials warning them of the possibility of attack by sea.

That was not according to those intelligence sources, something that created a big, a big reaction from the Pakistanis. However, at that time, the hotels here were put on alert that there could be a terror attack. It was just a few days before the attack that those hotels stood down some of those security precautions they put in place. But the head of the Taj Mahal Intercontinental Hotel says that even if he had put those, left those security precautions in place, it wouldn't have stopped the attackers getting into the hotel.

BLITZER: I want you to listen, Nic, to that sound bite from the man that was in charge of that company that owns the Taj Mahal Hotel. He spoke with our own Fareed Zakaria. Listen to what he is saying.

(BEGIN VIDEO CLIP)

RATANA TATA, CHAIRMAN, TATA GROUP: We did have certain warning and we did have some measures to, you know, people couldn't park their cars in the area where you have to go through a metal detector. But if I look at what we had, which all of us complained about, it could not have stopped what took place.

(END VIDEO CLIP)

BLITZER: I know there are a lot of recriminations going on right now, inside India, the home secretary has, in fact, resigned. What about this charge that they really, "A" didn't have good security and, "B" they didn't respond appropriately.

ROBERTSON: Well, Mr. Tata made those points in that same interview. He said that he felt the fire brigades couldn't respond quickly enough for those fires in the early hours. They couldn't arrive there on time. At water, he felt that the police were ill- equipped and ill-prepared when they arrived. He feels that the city needs a crisis management group and there is a ground swell of feeling that reflects that among the Pakistani community here. They say that -- the Indian community here rather. They do say they are immensely proud of what their commandos were able to do, of their security forces in general. But they don't think that they had good direction and that their systemic failures that have kept them from being at their best, Wolf.

BLITZER: All right Nic, stand by, we're going to get back to you by more in the investigation. By the way, the full interview with Ratana Tata will air on "FAREED ZAKARIA: GPS." That's at 1 p.m. Eastern. That's coming up right after LATE EDITION.

Some in India, as you just heard, are accusing Pakistan of being responsible for these attacks. Let's talk about that and more with Pakistan's ambassador to the United States, Husain Haqqani. He's joining us. Mr. Ambassador, thanks very much for coming in.

HAQQANI: Thank you for having me.

BLITZER: This individual that was captured who was said to be Pakistani, said now to say he was trained in Pakistan. Your response?

HAQQANI: Wolf, the 9/11 attackers came from several different countries. No one blamed the governments of those countries and I am glad that no one is accusing the government of Pakistan, the military of Pakistan or even Pakistan's intelligence services with any credible evidence this time around.

The important thing to understand is that Pakistan has condemned this action. Pakistan is on the same side as India and the United States and the rest of the world in fighting terrorism and I don't think that we will leave any stone unturned in helping with the investigation or dealing with any individual or group that might have connections with it as long as we have evidence to move against them. BLITZER: The foreign minister of India did say this on Saturday. "The preliminary investigation indicates that some elements in Pakistan are involved."

HAQQANI: Look Wolf, here's the situation. Terrorists operate in so many countries these days. There have been terrorists that have been found in the United States training, they have been caught. That doesn't mean that the United States is to blame. The important thing is Pakistan is a victim of terrorism. India is a victim of terrorism. We need to put the burden of history behind us, work together and make sure both of us get rid of this terrorist menace that afflicts both of our countries. BLITZER: A lot of intelligence, counter terrorism experts are pointing a finger at this group, Lashkar-e-Taiba. And I'm going to read to you from "The New York Times" today because I want you to respond. "Lashkar-e-Taiba, which has a track record of attacks against India has received training and support from Pakistan's premier intelligence agency, Inter-Services Intelligence, or ISI, according to widespread intelligence reports." That was in today's "New York Times."

HAQQANI: Lashkar-e-Taiba is a group that has been banned in Pakistan. Of course, all such groups, al Qaeda is a banned group but that doesn't stop al Qaeda from operating. The important thing is that the government of Pakistan will make sure that any group or individual that is found to be involved in this or any other act of terrorism is subjected to the same process that these groups have to be subjected to under international law. Let me just say one thing.

BLITZER: Was this group, though, created by Pakistani intelligence?

HAQQANI: Well, there's no way for me to know who created it. But we do know that it existed in Pakistan and operated in Pakistan until it was banned.

BLITZER: It was basically created to fight the Indians in Kashmir, the disputed territory between India and Pakistan.

HAQQANI: Look Wolf, you must understand, what are the targets of the terrorists right now? Why did they go to Mumbai? They wanted to weaken Pakistan's democracy. They wanted to weaken Pakistan's fledgling democracy. And they wanted to harm Indian/Pakistan ties. All these extremists want India and Pakistan to be at each other's throats so they can flourish.

I think India and Pakistan should be very cautious not to let terrorists flourish. President Asif Zardari, Prime Minister Gilani, everybody in Pakistan has made it very clear this time around Pakistan is not going to give any quarter to any terrorist groups and we want to work with India. We will cooperate in the investigation and we'll make sure we get these guys if they have any connection to us.

BLITZER: When you say you will cooperate, initially there was a report that the leader of the Pakistan Intelligence Service would actually go to India to help in this investigation, but that changed and he no longer is going, they're sending others. What happened? Why did you decide that head of ISI should not go?

HAQQANI: Well, it has to do with the circumstances and that the fact that the investigation is at a very preliminary stage.

HAQQANI: You go to the highest level when you have the preliminary situation under control.

BLITZER: But it would have been a nice gesture to reassure the people of India that Pakistan was fully cooperating. HAQQANI: (inaudible) the president of Pakistan has called the Indian prime minister. The prime minister of Pakistan has spoken to Indian leaders. He has spoken to the Indian prime minister. The Pakistani president has spoken to the Indian foreign minister.

And I am here, through you, to tell our friends in India that we look upon you as neighbors. We have had problems in the past, but that does not mean that we will continue to have a negative view of each other in the future.

India and Pakistan need to work together. We are both victims of terrorism. We need to fight terrorism.

And if there has been -- look, Pakistan has pointed the finger at India, in the past, about terrorist acts in Pakistan. This is not the time to bring those allegations back again.

BLITZER: Are you moving troops from the western part of Pakistan, near Afghanistan and the tribal areas, over there, to the eastern part, where India is?

HAQQANI: Wolf, there is no movement of troops, as of now. However, if there is any troop buildup on our eastern border, we will certainly have to take defensive positions. And, unfortunately, that may mean bringing troops from the western border.

We don't want it. We know India doesn't want it. And we know that the international community doesn't want it.

The U.S., Pakistan, Afghanistan, India, the international community -- we are all in it together.

BLITZER: Are you seeing any evidence that the Indians are moving troops to their border with Pakistan?

HAQQANI: I have heard the same things that you have heard. There is no evidence of troop buildup along the Pakistani border. There have just been -- there's just been rhetoric.

But I would just say that this is time to tone down the rhetoric, pay attention to the intelligence failures, make sure that our intelligence cooperation improves globally, and terrorism is dealt with as an international menace.

Here's my problem with the coverage of the last few days. There's too much focus on the India-Pakistan dimension of this issue, very little focus on the international terrorism dimension. Terrorism is an international problem. We all need to work together to eliminate it.

BLITZER: As you know, though, there a lot of people who are deeply concerned, including here in the United States, that both India and Pakistan are nuclear powers. They've gone to war over Kashmir, over these many years, on a few occasions. And tensions could ratchet up. There could be miscalculations on both sides. HAQQANI: It's important to avoid miscalculations. It's important not to ratchet up tensions. It is important to understand that this is an opportunity for India and Pakistan to work together.

This is an opportunity for us to take care of the burden of history and make sure that, not withstanding what our problems have been in the past; notwithstanding what our disagreements are, we agree on fighting terrorism.

And the hearts of Pakistanis go out to the people in Mumbai. Look, many of the people who were killed -- this was not about religion -- many of the people who were killed were Muslim; some were Christians, some were Hindus; some were Jewish.

The important thing is that the terrorist is the enemy of all humanity. And we need to look upon the terrorists in that way.

BLITZER: Ambassador, thanks very much for coming in. Good luck to all the people in Pakistan and in India. This is a tense moment, right now.

HAQQANI: Thank you very much, Wolf.

BLITZER: Thank you very much for coming.

And we're going to have much more on the Mumbai attacks coming up later, including our panel of intelligence and counterterrorism experts. You're going to want to stick around for that.

But, up next, the president of the United Auto Workers is standing by, live, to give us his take on the proposed bailout of the three U.S. automakers.

And later, James Carville and David Gergen and Ed Rollins -- they break down President-elect Barack Obama's incoming foreign policy team, which will be announced tomorrow, including Hillary Clinton as secretary of state. Stay with "Late Edition." We'll be right back.

(COMMERCIAL BREAK)

BLITZER: We'll get back to the Mumbai terror investigations shortly. But we turn, right now, to the ailing U.S. economy and the proposed bailout for the top three U.S. automakers.

Critics of the industry say a major part of the problem is the high costs associated with labor union workers.

Our next guest certainly has a lot to say about that. He's the president of the United Auto Workers, Ron Gettelfinger. He's joining us from Detroit.

Mr. Gettelfinger, thanks very much for coming in.

GETTELFINGER: Thank you, Wolf. And thanks for having the UAW on your show. BLITZER: Thank you. Let's listen to Barack Obama, because he had some strong words about this proposed bailout for GM, Ford and Chrysler. Listen to this.

(BEGIN VIDEO CLIP)

PRESIDENT-ELECT BARACK OBAMA: We can't just write a blank check to the auto industry. Taxpayers can't be expected to pony up more money for an auto industry that has been resistant to change.

(END VIDEO CLIP)

BLITZER: All right. The CEOs of the Big Three -- they came to Washington, a couple weeks ago, didn't do a very good job. They were sent back home and told, come back with a plan to restructure.

What's the most important thing they have to tell Congress and the American public, in the coming days, to justify this $25 billion bailout package?

GETTELFINGER: Well, there's no question, Wolf, that they need to bring in a plan that shows accountability, as well as long-term viability. And there's also going to be a restructuring in the industry. And I'm sure that they're going to address that as part of their plan.

BLITZER: Well, give me some specifics. Give me an example of what they can do to reassure the American public that this is not simply good money going to bad.

GETTELFINGER: Well, I think one of the things they need to do, under the accountability, is they need to establish executive compensation as something that they're willing to curtail, as well as parachutes -- golden parachutes, on exiting the business. Additionally, they need to talk about prohibiting additional dividends.

They can also give the government an equity stake in a business. And they can just be accountable and have -- the administration can bring in an oversight committee to make sure that this money is spent as it should be.

Under viability, there's no question. Nobody wants to throw money down a rat hole, if you will.

So I think, as part of their restructuring, they need to come in and talk about additional future product.

But here's the thing, Wolf. We're talking about millions of American jobs being impacted here. We're talking about everything from Main Street to side street to rural America.

So,what we need to do is remember that the entire industry, around the world, has been impacted by this economic downturn. It's not just here in the United States. And this is not a bailout. This is a loan, a bridge loan that will get us through until we can take a longer-term look at exactly what needs to be done in the industry.

BLITZER: It's a loan if, in fact, the companies can repay it, down the road. And, as you know, many members of Congress are concerned about the viability.

But I want to get into some of these specifics with you. Listen to Nancy Pelosi and Harry Reid, the Democratic leaders of the House and the Senate.

BLITZER: They said this in a joint statement. "Congress is prepared to consider additional legislation that would give the assistance you seek, provided that you submit a credible restructuring plan that results in a viable industry, with quality jobs and economic opportunity for the 21st century while protecting taxpayer investments."

Now I know the UAW has made its own concessions over the years in the various negotiations with management trying to make sure that these big three auto companies are responsible and can stay viable and productive. But what else is the UAW prepared to do right now to help during this crisis?

GETTELFINGER: Well, I think it's important to note that a lot of what we did in '05 and '07 will continue out into the future. We'll define that. But I also think it's important that everybody come to the table, Wolf. We need the board members, the management, the suppliers, the dealers, the creditors and the equity holders to all come at the table to make sure that one group doesn't have to accept all the sacrifice.

We're prepared to go back to the table, the bargaining table. But I think it's important, again, to note that labor costs of a vehicle are 10 percent total. So, you can't lay all of that back on to the active and retired members of our union and they have stood up and this myth about this $70 wage, it's just unbelievable to me that the spin masters are out there throwing that around when, in fact, it's not reality.

BLITZER: Listen to Mitt Romney, the former Republican presidential candidate, a son himself of the auto industry. His father George Romney, the former governor of Michigan was a leader in the U.S. auto industry in his day. This is what Mitt Romney said on this program exactly one week ago.

(BEGIN VIDEO CLIP)

MITT ROMNEY, FORMER REPUBLICAN PRESIDENTIAL CANDIDATE: The labor element is a big part of the burden that this industry faces. The U.S. automobile companies are subject to about a $2,000 per cost disadvantage relative to foreign companies that come here and build cars. You can't compete if the cars you make have $2,000 less value in them at the same price point and that's going to have to change. That's pension benefits. It's health care costs for pensioners and current employees.

(END VIDEO CLIP)

BLITZER: All right, you want to respond to Governor Romney?

GETTELFINGER: Well, first of all, Governor Romney's never been a friend of working people or organized labor at all. Secondly, based on the changes that we've made in our contracts, we are competitive and I would challenge Mitt Romney on that. If we want to throw our retirees out on the street, if that's what Mitt Romney wants to do, let him do it. We're not prepared to do that and it's hard for us to compete when we subsidize state by state the foreign brands to come in here.

But, Wolf, I'm telling you based on the changes that we've made and our contract, the hard sacrifices that were made by the men and women of the UAW, we have put these companies in a competitive position and I didn't hear him talking about the safety records that we have. I didn't hear him talking about the quality where we set the bench mark in many areas or the productivity and it's wrong for people like that who really have no experience in the industry to come out here and then to point the blame at organized labor or, in this case, to point the blame at management.

This is a downturn that has been felt around the world. And 40 percent of our gross domestic product goes right to the automobile industry. We cannot afford to see these companies fail. And it's just incumbent on this Congress when they come back together the week of December 8th to vote in favor of this low-interest bridge loan. That's what it is. It's a bridge loan that is going to be paid back to these companies.

BLITZER: We're out of time, Mr. Gettelfinger, because we're limited. But one quick final question. It's a sensitive issue, probably in the scheme of things financially not that significant, but in terms of public relations, very important. The CEOs of the big three auto companies when they come to Washington in the coming days, do you want them to fly commercial or fly on their private jets?

GETTELFINGER: Well, there's no question they're going to come in different ways, but the sad thing about that is, it became a distraction. It became a sound bite.

Look, I'm one to be critical of management and I'll do that privately. But I would say this. Let's get focus back on the issue and that's our economy. This economic downturn that we were in that was not created by the industry and, again, it's been felt around the world. Other countries, other governments are given consideration to help in the auto industry. Our government should be no different and, by the way, we're no different than Citigroup, AIG, Bear Stearns. We will bring the plan. They didn't have to. But we're prepared to bring a plan to get this loan.

BLITZER: Well good luck, Mr. Gettelfinger. Good luck to the auto industry, all the men and women of the United Auto Workers as well. Thanks very much for coming in. GETTELFINGER: Thank you very much. BLITZER: James Carville, David Gergen and Ed Rollins, they're standing by live right now. We're going to talk to them shortly, but just ahead, this has been a historic week in Iraq. We're going to talk with one of the top U.S. military commanders on the ground right now about the now scheduled withdrawal of all U.S. combat forces from Iraq. You're watching LATE EDITION, the last word in Sunday talk.

(COMMERCIAL BREAK)

BLITZER: It was a historic week in Iraq. The Iraqi parliament approved a security agreement ending U.S. troop presence in Iraq by 2011. It also includes major changes in the way the U.S. military would operate in Iraq. Major General Mark Hertling is the U.S. military commander of the Multinational Division in northern Iraq. He's joining us from Tikrit right now. General Hertling, thanks very much for coming in.

Not only are all U.S. troops supposed to be out of Iraq according to this agreement, the status of force agreement as it's called by the end of 2011, but by the end of next June, all U.S. combat forces out of all the cities and towns of Iraq, including Tikrit, the home town of Saddam Hussein where you are right now. Is this realistic? What happens when U.S. forces leave these towns and cities?

HERTLING: Well, first of all, Wolf, the status of forces agreement was really a historic moment for Iraq. It established Iraq as a sovereign nation and part of that is having U.S. forces here at the invitation of the Iraqi government to help them improve their security, further improve their security and stability.

In terms of us moving out of the cities, we're not in the city of Tikrit, rather. We're outside of the city now and we're partnering with the Iraqi forces as we have been doing for the whole 15 months we've been here. I've had conversations already with all of our Iraqi division commanders. They understand what the SOFA is about and they understand that we'll continue to conduct combined operations with maybe some twists over the next several months and my replacement is talking to them about that right now, as well.

HERTLING: But I think we'll continue to conduct combined operations with the Iraqi army and there will be some changes, but it won't affect how we do business.

BLITZER: Are you saying that U.S. troops will continue to operate for example within Mosul in the northern part of Iraq. It has been a rather tense part of the country.

HERTLING: It has been a tense part of the country. We will continue to operate there with our Iraqi brothers, but there will be some additional requirements for us to coordinate operations with the government of Nineveh Province, where Mosul is.

That's what the SOFA determines. Wolf, we will be having to give much more information in terms about what we're doing. But, frankly, Wolf, we have been doing that for several months already. We have been practicing for the SOFA. We have been preparing for it and I think what you see about 90 percent of our operations currently are with the Iraqi army or the Iraqi police, so, some of that notification is already being given. We'll just have to polish the diamond a little bit on that one.

BLITZER: SOFA stands for the status of forces agreement that the Iraqi parliament approved. But there is supposed to be a referendum, a national referendum and already we're hearing from the very influential Shiite leader, the Ali al-Sistani, the Ayatollah Ali al- Sistani suggesting that he's not very happy with this agreement. What happens if in this national referendum that is supposed to take place next year it fails?

HERTLING: Well, that's the great part about having this kind of representative government, Wolf. What is happening now is they are deciding these kinds of things with arguments and discussions and debate. A few years ago, as you well know, this would have been decided with guns, instead. If the political masters in Iraq understand what their people want and decide to do things and make amends, they are a sovereign nation now and we're here at their invitation. So I think all of the political leaders will be heard as they continue to debate the SOFA over the next few years as it runs out.

BLITZER: Here's what Ahmed Chalabi, he's an Iraqi parliamentarian. He was a very strong U.S. ally of the Bush administration going into the war and this is what he wrote last week in "The New York Times," among other things. "Iraq has endured occupation, the authoritarian installation of a prime minister, the strong-armed removal of an elected leader, the indiscriminate arrest, torture and killing of Iraqi civilians without recourse to law, and an utterly corrupt reconstruction program that oversaw one of the biggest financial crimes in history, which has left average Iraqis with little water, power, health care, education or even food."

Is that what you're seeing in the northern part of Iraq where you command U.S. and multinational forces?

HERTLING: No, I don't, Wolf. There are still some problems with the infrastructure. There are certainly some problems with electricity and pure water in all of our provinces, especially in the rural areas. There are some challenges with distribution of fuel and sources like that.

But, frankly, every day what I'm seeing is a government of Iraq that is reaching out to the provinces. In fact, Deputy Prime Minister Al Asawai was just in Tikrit this week. I met with him as did the governor of Salah ad Din Province.

He has been almost tireless in going around to all the provinces to try to improve that infrastructure repair. They've passed their budgets, they're executing their budgets and things, quite frankly, are improving under the control of the Iraqis. This doesn't have as much of an American hand in it any more. They're taking charge but because of the 30 plus years of turmoil and trauma that they experienced, it's going to take a while. But there are patriots stepping up in Iraq and improving things every day.

BLITZER: You're wrapping up right now your second 15-month tour of duty and in Iraq. In the end, you will have been there for 30 months since 2003, General Hertling. And I guess a lot of folks are probably asking you this question. The sacrifices you personally have made and your troops, was it worth it? You think in three, four, five years from now when the dust settles, do you think it will have been worth it?

HERTLING: Absolutely, Wolf. There is no doubt about it. In fact, an Iraqi came up to me yesterday and he said as he knows I'm leaving, he said you know the blood of American soldiers and Iraqi soldiers have come together in this fight and have fertilized the land and from that fertilization, liberty is growing. That was a great quote. He was somewhat of a poet when he said it.

But frankly, the sacrifices of soldiers, airmen, marines and sailors and some of our military civilians that have been over here, have certainly been worth it. We have seen hope evolve in the faces of the Iraqi people, all throughout the northern provinces. They still have a lot of challenges, that's for sure.

But even though our soldiers have spent two birthdays over here, two Thanksgivings, they've missed a lot of t-ball games. I think if you talk to every one of our soldiers in Multinational Division North and anywhere else in Iraq, they will tell you it was worth it because they gave liberty to a people of a country of 25 million. And that's what makes our job worthwhile.

BLITZER: Let's hope it works out. Major General Mark Hertling, thanks to you. Thanks to all the men and women you command, especially on this Thanksgiving weekend. Thanks for your sacrifice, thanks for your service to the United States of America. Appreciate it very much.

And just ahead, we'll get the latest on the recovery efforts in Mumbai. Stay with us. LATE EDITION continues right after this.

(COMMERCIAL BREAK)

BLITZER: Following very closely the investigation into the terror attacks in Mumbai. CNN's Sara Sidner is on the scene for us right now. Sara, I know you have been there from day one since it all erupted on Wednesday. Have you seen major security changes throughout Mumbai over the past few days?

SARA SIDNER, CNN CORRESPONDENT: Absolutely, Wolf. What is ironic about that is that the security actually became beefed up today in the final day of all of this.

Before we were allowed to sort of get quite close to the Taj Hotel here without having a lot of security stop us, without having even a cordon. I was able to walk very close to the hotel when everyone was saying it was over and that actually turned out not to be true. It had gone on for 60 hours basically before there was some change, before all of the terrorists were taken down and, so, it is a little strange that security was beefed up and, yet, the scene has calmed down quite a bit.

Now the people who were very close to the Taj, there aren't as many army personnel. There aren't as many national security guards who are sort of close to the Taj area now. That has certainly died down a bit. And I should mention that the lights are on and that is significant in that during all of this, the hotel and the commandos told everyone inside to turn all of the lights off in their rooms and to be holed up in their rooms and not let anyone know that they were in there. The lights are finally back on inside the Taj Hotel indicating that the commandos able to go room to room and secure the area. Wolf?

BLITZER: It looks like this is down for now. We're watching it very closely with Sara and our team of correspondents on the scene. Sara Sidner, thanks very much.

From an economic crisis to the war on terror, there's a sense that Barack Obama already has his hands full, even though he isn't yet the president of the United States. We're going to talk about his challenging transition to power with James Carville, David Gergen and Ed Rollins. They're standing by live.

BLITZER: LATE EDITION continues right after this.

(COMMERCIAL BREAK)

BLITZER: The ailing economy may be issue number one right now in the United States, but this week's terror attacks in India certainly a grim reminder of the ongoing war on terror. Let's talk about that and more with three of the best political team on television. Democratic strategist James Carville is in New Orleans. Republican strategist Ed Rollins is in New York. And our CNN senior political analyst and former presidential adviser David Gergen is joining us from Boston.

David, let me read to you from Barack Obama's statement on Friday about these Mumbai attacks. "There is one president at a time," he said. "I will continue to closely monitor the situation on the ground in Mumbai and I'm grateful for the cooperation of the Bush administration in keeping me and my staff updated."

How are they doing, an incoming president and outgoing president in dealing with an international crisis like this one?

GERGEN: I think they've handled it fairly deftly so far. The Bush administration I think has gone to extraordinary lengths to make this a smooth transition. They deserve credit for that. And they are working closely behind the scenes with the incoming administration. Condoleezza Rice and Barack Obama spoke three times by telephone in the days immediately following Mumbai.

Barack Obama waited for George W. Bush to talk to the Indian prime minister by phone before he personally connected with the Indian prime minister.

But most importantly, Wolf, I think that tomorrow we're likely to have the announcements of his national security team and I think that by putting heavyweights in those positions, just as he did in his economic team, that Obama will send out reassuring signals not only to the United States but around the world that the American foreign policy is going to be in good, sound, experienced hands on January 20th and the transition which can sometimes be rough, has become much more seamless than anyone might have imagined only a few weeks ago.

BLITZER: And we're hearing, Ed Rollins, I want you to weigh in on the announcement tomorrow. It will be dramatic. Everyone expects Hillary Clinton will be named the secretary of state and James Jones, the retired U.S. marine commandant, the former NATO supreme allied commander will be the national security adviser and Robert Gates, the current defense secretary will be asked to stay on as defense secretary.

If you look at these pictures of these three individuals, what message will Barack Obama be sending, not only to the United States, to people in America, but around the world?

ROLLINS: This is a very experienced team. This is a team that has great stability. Obviously, keeping Secretary Gates is very, very important. I think it's showing that our foreign policy historically is not partisan. There's almost a consistency whether it's a Democrat or Republican administration. Some minor changes but usually the overall policy is pretty consistent. Hillary Clinton 16 years experience, eight as first lady, eight as a United States senator. You couldn't pick a better person that has traveled the world and knows the players. Obviously, General Jones is an extraordinary human being who has led in every position he's been in. I think it's as strong of a foreign policy team as I've seen in a long, long time.

BLITZER: Getting a lot of praise out there, James Carville, but some on the left, not necessarily all that excited by this. What do you think?

CARVILLE: I think this is as solid a team that has ever been put together by any president in the end coming in. And you know, some of these people on the left, you never can please them. But I think the president-elect understands that this is a really dangerous world out there as evidences of what happened in India, as evidenced by what Senator Biden said during the campaign that drew some controversy. But most people think is true that people are going to test this new president very early during his term and I think that he's putting a pretty good team on the field. If they test his team, I think they're going to find it's a pretty tough bunch that they have.

BLITZER: And Hillary Clinton, they worked out all the details, as you fully expected involving the former president, Bill Clinton, her husband, James, any other thing, any other things that have to be resolved in advance of tomorrow based on what you know?

CARVILLE: Not based on what I know. I think that these things that President Clinton, as you know, made everything public. He went out of his way to do everything he could to remove any impediment to this happening and I think that the Obama people are nothing vocal, quite pleased with the way it went. But as far as I know, this thing is on scheduled for tomorrow.

BLITZER: What do you think, David Gergen, about any sort of awkward moments that could develop between President Barack Obama and Secretary of State Hillary Clinton?

GERGEN: Well, there are some risks and a number of people, David Broder and Tom Friedman and others have questioned this appointment. But I think the risks are overstated and, you know, we heard a lot of hand ringing about whether Hillary Clinton would be supportive of Barack Obama the candidate. And what we saw that she swung behind him and was enormously loyal and very energetic on his behalf as candidate. And her voters came home for the Democratic Party. We heard a lot of wondering whether Bill Clinton would stand in the way of his wife or he'd be supportive of Barack Obama and he, too, has now signed on in a very fulsome way. So my expectation is that she will become a, the surprises will be on the upside. She will become a better partner.

And let me just say if I might, Wolf, one other thing. President George W. Bush also brought in a group of heavy weights in national security, but they never fully gelled as a team in part because there were such big differences between a say Dick Cheney and Colin Powell over policy.

As best I can tell when you look at this full team, including the vice president, who is an important member of the team, the president- elect, Hillary Clinton, Bob Gates and Jim Jones, the policy differences are quite small.

They basically agree on most of the substance. Bob Gates, for example, agrees that we should be talking to Iran. Bob Gates has argued for some time that there should be more power moved back to the State Department. There should be more soft power, be more diplomacy coming out of the U.S. government. So, I think that's encouraging.

BLITZER: I am going to have Ed Rollins weigh in on this, as well. But we want to take a quick break, guys. Stand by. We have a lot more to talk about, including the domestic economic issues on the president-elect's plate that's coming up. Much more right after this.

(COMMERCIAL BREAK)

BLITZER: We're back. We're tracking Barack Obama's transition to power, his emerging cabinet, with Democratic strategist James Carville, Republican strategist Ed Rollins and CNN senior political analyst David Gergen.

Ed, Ed Henry, our reporter, our White House correspondent in Chicago, is now learning that, in addition to the Hillary Clinton and Robert Gates and General James Jones announcements tomorrow, three other announcements are going to be made tomorrow, two of them widely anticipated. Eric Holder will be named the attorney general and Janet Napolitano the homeland security secretary. Susan Rice, a former National Security Council official in the Clinton administration -- and a State Department official -- will be named the United Nations ambassador.

What do you think about these additional announcements?

ROLLINS: Extraordinary talent. And I think the interesting thing is, even though I'm the opposite party, these are people that are widely respected by Republicans on the Hill.

You've not heard anybody pointing fingers and saying, this is a bunch of lightweights. They're all saying, these are a bunch of greatly talented people who certainly can do the job.

The other part of this administration -- the people are not household words. But to those of us who have been in the trenches against them, he's put an extraordinary staff in the White House. He's putting some people who will be widely known in a period of time.

But all sides are being represented. And those who are liberal that are worried about not having voices, they're going to have their voices in there.

There's people from a lot of the activist groups. They're talented; they're experienced; they know what they're doing. And I think they're going to hit the ground running and surprise a lot of people.

BLITZER: You know all these people, James Carville, quite well. You worked with them for many years.

What do you think of these three additional names that are going to be announced as part of the team tomorrow?

CARVILLE: Look, this is -- this is an awfully fast track that everybody's running on, and I think all three of these names can run on a track with anybody. I think it's in line with the kind of quality you're seeing.

And I think that the president-elect and Rahm Emanuel, as chief of staff, you know, are bound and determined to, you know, search and scour this country to get the best they can. And I think, thus far, they've succeeded. And I expect the rest of their appointments will live up to this kind of quality.

BLITZER: David, as much as the terror issue dominated the news, because of Mumbai this week, there's certainly an economic crisis, not only in the United States but a global economic crisis.

And we now get word, over the past few days, that the president- elect wants the new Congress, in early January, to pass a huge economic stimulus package. He'd like to sign it into law when he takes office on January 20th. Listen to this. He said this. "It is my hope that the new Congress will begin work on an aggressive economic recovery plan when they convene in early January, so that our administration can hit the ground running. With our economy in distress, we cannot hesitate and we can't delay."

Go ahead and -- is this overly ambitious to think this is possible, David?

GERGEN: Well, he has -- you know, we all know he has the worst crisis on his hands in some 75 years or so. And he now is taking unprecedented steps.

I don't think that James or Ed or I have ever heard of a president asking for the Congress to enact, you know, massive legislation before he gets into office.

(CROSSTALK)

BLITZER: And we're talking, what, $500 billion, maybe -- some reports saying it may be $700 billion for this economic recovery plan, as they call it.

GERGEN: Absolutely. And he's going to have to decide not only on how that plan is going to be structured and what it's going to cost. He's going to have to send some signals on the auto bailout that's going to be under discussion, starting this week, back in Congress again.

So there are big decisions ahead. I do think, Wolf, that he's got a terrific team. I mean, the Republican senator, Judd Gregg of New Hampshire, said, in the past few days, about putting Larry Summers and Tim Geithner into his economic team -- he said it was like signing up Manny Ramirez and David Ortiz on the same day. And there is that quality about these heavyweights. I think there is going to be a renewed pressure to make sure that this package is structured in a sound way, that it not be done in a great panic or in a great rush, that we actually think it through, both on the automobiles and especially on the $500 billion to $700 billion.

And in that sense, Barack Obama was going to be under a lot of pressure, in the next two or three weeks, not only to get his team named but to think through and to show the same kind of wisdom and intelligence he's shown on appointments in the actual substance of what he's proposing.

BLITZER: It says a lot, Ed Rollins -- correct me if I'm wrong -- about his self-confidence, Barack Obama, that he's bringing in these major figures with a lot of experience and a lot of personality and a lot of strong ideas, in the sense that he's not afraid that they're going to fight each other and fight him.

ROLLINS: I think that's one of the greatest compliments to him, is that he's not afraid of smart, strong people around him.

Equally as important, though, he has a comfort level. He's got Axelrod. He's got Jarrett. He's got some people that he can go to, inside the White House, so he can talk over things, who he's got a long history with.

The key thing, here, though, on the economic stimulus package, is to make sure that the Congress is really involved in it and that the Republicans at least have an opportunity to voice some concerns.

If not -- obviously the votes are there; the Democrats can put through whatever they want. But if, for some reason, this doesn't work, you know, you want to make sure everybody is involved in the process and it's thought through and it's not a rush to judgment, as the stimulus bill of a couple months ago was.

BLITZER: Ed Rollins, James Carville, David Gergen, guys, thanks very much, as usual, for coming in.

Up next, two key senators discuss how the U.S. should respond to the attacks in India. "Late Edition" will continue, right at the top of the hour.

(COMMERCIAL BREAK)

BLITZER: This is LATE EDITION, the last word in Sunday talk.

(BEGIN VIDEOTAPE)

BLITZER (voice-over): Massacre in India.

BUSH: Terror will not have the final word.

BLITZER: Terrorists attack a key U.S. ally. We'll discuss that and more with Republican Senator Arlen Specter and Democratic Senator Robert Menendez. Plus, insight on the investigation and who might be behind the attacks from four terrorism experts.

Transition to power.

OBAMA: What we are going to do is combine experience with fresh thinking.

BLITZER: We'll assess Barack Obama's emerging cabinet and the challenges facing the next U.S. president with three of the best political team on television. LATE EDITION's second hour begins right now.

(END VIDEOTAPE)

BLITZER: And this just coming in to CNN right now. President Bush has spoken with the Indian Prime Minister Singh once again this morning to reassure him that the United States stands with India right now.

This as investigators are combing through evidence to try to get to the bottom of a three-day terrorist attack in the city of Mumbai that killed 183 people and left 273 others wounded. Our senior international correspondent, Nic Robertson, is in Mumbai. He's following the investigation for us. What's the latest? Where is the evidence pointing to, Nic? ROBERTSON: Well, the evidence, Wolf, is pointing to Pakistan, and it's seriously raising tensions in this region. The FBI has a team coming in here. British investigators have a team on the way, as well, and the Interpol, the International Police Group, are also negotiating with Indian authorities to get a team of representatives. In fact, two teams of representatives here as well. There's a really big international feeling at the moment that, while the fingers point at Pakistan to be behind this, that it is raising tensions in the region. And that's giving everyone cause for concern.

Why are the fingers pointing at Pakistan? The only gunman who was captured alive in the attacks, is according to police here, from Pakistan. CNN's sister network, CNN IBN here, who have sources inside India's intelligence services, say that this Pakistani gunman says that he was trained by a Pakistani terror group inside Pakistan, supported by them when he came to the others -- to India, to Mumbai.

He also says that a two-member team from that Pakistani terror group came to India to reckon away the area, reckon away to the place for the attacks two months before the attacks took place.

He said when they came, they were given Google Earth maps and told to memorize those maps and follow the routes to get to their targets. We've also learned from our sister organization CNN IBN, we're just hearing from its Indian intelligence sources that they say that U.S. intelligence officials gave Indian officials here a warning at the beginning of October that Mumbai should be braced for the possibility of an attack from the sea. Wolf?

BLITZER: But, Nic, we want to be really precise. What they're saying, the Indians, Indian authorities, is that elements in Pakistan, whether this terror group, Lashkar-e-Taiba, or another terror group may have been responsible. They're stopping short of saying that the Pakistani government was responsible for this. They're suggesting that elements in Pakistan were responsible. Is that right?

ROBERTSON: That is. They're blaming the group Lashkar-e-Taiba. Lashkar-e-Taiba in the 1990s was a group that the Indian government says was a state-sponsored terror group working inside India to try and advance Pakistan's claims on that disputed northern region of Kashmir.

Now, Pakistan rendered that group -- well, at least made the membership of Lashkar-e-Taiba illegal in 2002. The group changed their name. However, the Pakistani government officials say they absolutely are clear in this, that they have no involvement in this group, that they will do whatever they can if the training ground was found to be in Pakistan or any of these people were found to come from Pakistan. They'll do whatever they can to stop them and help the Indian government, Wolf.

BLITZER: Nic Robertson, stand by. He's on the scene in Mumbai. Joining us now with their take on these terror attacks in India and more, two key members of the United States Senate, Pennsylvania Republican Senator Arlen Specter is joining us from Philadelphia. And New Jersey Democratic Senator Robert Menendez is joining us in New York. He's the new chairman of the Democratic Senatorial Campaign Committee, which is in charge of getting Democrats elected to the Senate. Senators, to both of you, thanks very much for coming in.

Senator Specter, let me start with you. A rather tense moment not only between India and Pakistan right now but for the United States. The stakes are enormous. In the last hour, the Pakistani ambassador to the United States, Husain Haqqani, told me this right here on LATE EDITION. Listen to what he said.

(BEGIN VIDEO CLIP)

HAQQANI: The important thing to understand is that Pakistan has condemned this action. Pakistan is on the same side as India and the United States and the rest of the world in fighting terrorism, and I don't think that we will leave any stone unturned in helping with the investigation or dealing with any individual or group that might have connections with it as long as we have evidence to move against them.

(END VIDEO CLIP)

BLITZER: Here's the question, Senator Specter. Do you believe him?

SPECTER: I do. The tensions are high, and the consequences could be disastrous. You have two major nations with nuclear weapons. There's been heavy tension in the past, and anything could explode.

But it's a critical difference to point out that it is a terrorist group in Pakistan. Listen, after all, the terrorists in Pakistan assassinated Benazir Bhutto. I was in Pakistan in Islamabad last year scheduled to meet with Benazir Bhutto. And when you have terrorists at work, it is not the work of the Pakistani government. I think it is very important for the United States government to play a suitable role. A call from President Bush to the Indian prime minister is very important, and let's keep cool, all right? Let's find out who's responsible, and I think it is important that the Pakistani government has said we are with you, India, and we will take action against any terrorist group.

BLITZER: Senator Menendez, you're on the Senate Foreign Relations Committee. What do you think about the potential for this crisis in India right now, in Mumbai, escalating into warfare, if you will, between India and Pakistan?

MENENDEZ: Well, Wolf, first of all, our thoughts and prayers are with the families in India and the United States for those who lost loved ones. And this is one of those critical moments where the United States can play a role in making sure that both the Pakistanis and the Indians cool the present passions and we get to the facts so that we can understand whether, in fact, it is simply elements in Pakistan that conducted these terrorist attacks, and also see the response of the Pakistani government if that is established as they move against those elements, and that produces good faith with the Indians.

What we don't need is a repeat of what happened several years ago, when these two nations sent troops to their respective borders and escalated -- these are two nuclear-powered nations that ultimately we cannot have in confrontation. So it's an important moment for diplomacy, as well. And I'm glad that our government has sent teams, particularly the FBI, to help the Indians so we can determine what the truth is.

BLITZER: There's certainly, Senator Specter, no shortage of landmark hotels here in the United States, described very often as so- called soft targets. What's the most important lesson the United States should learn right now from what happened this past week in Mumbai?

SPECTER: To be prepared, to be on guard against terrorism, and to have the kind of weapons for intelligence and law enforcement to try to prevent an attack. So far, Wolf, since 9/11, 2001, we haven't had a major incident in the United States. I think we have to keep working at it.

BLITZER: And what about you, Senator Menendez? When you look and see what happened in Mumbai this week, what goes through your mind as far as lessons for the United States?

MENENDEZ: Well, certainly intelligence is the first line of prevention, and interesting that Nic Robertson mentioned that the United States gave some intelligence to the Indians to be prepared of a possibility.

That's something that we have improved since September 11th, constantly need to work on it to make sure all of our intelligence agencies are sharing across the spectrum, and understanding that there is not a simple target anymore. The target that you would expect -- a nuclear power plant or, in fact, a financial institution -- that the targets are now diverse, because at the end of the day, part of the terrorism here is to strike once and maybe create hostility between Pakistan and India.

MENENDEZ: That can be one of the terrorists' efforts. The other one is to strike at tourism and the heart of the financial industry inside of India, so there are different elements that one must recognize that the targets are no longer the traditional ones one might think of, that they are diverse.

BLITZER: President-elect Obama, Senator Specter, certainly has enormous challenges in terms of foreign policy, as well as domestic, economic issues. Are you going to be with him in January? He wants Congress to pass maybe a $500 billion or $700 billion economic stimulus package that he can sign into law as soon as he takes office on January 20th. Are you ready to support him on this?

SPECTER: I want to take a close look at what he has to offer, but I'm anxious to get back to Washington. I think it is a good idea for the Senate to be in session early. I'm prepared to go back tomorrow and stay to act as promptly as we can. And my record is one where I have demonstrated my willingness to cross the aisle, work with a president of the opposite party, and I think it is high time we put partisanship aside. The American people are sick and tired of the bickering in Washington, and I'm prepared to work with President-elect Obama, but first I want to see exactly what he has in mind and take a close look at it. I am a firm believer in separation of powers. We have an independent role in the Senate. But I'm prepared to work with Democrats across party lines in the public interest, definitely.

BLITZER: Senator Menendez, are you prepared to support this $25 billion bailout or bridge loan, as some are calling it, for the big three automakers?

MENENDEZ: Well, Wolf, we're going to be having a hearing in the Senate Banking Committee, which I'm a member of, this Thursday, and I'll have to hear what the automakers have to say.

When they came before us a couple of weeks ago, I was not impressed with their presentation. They have to show a plan that shows that the $25 billion gets them to the points of viability. They have to show us a plan of how they're going to restructure their industry. They have to show us a plan about not opposing higher fuel efficiency. If they do those things, then there will be support them. And we'll wait to see what their plan actually is.

BLITZER: One final question for Senator Specter because we're out of time. Senator Specter, you've seen these reports out there that Chris Matthews, the anchor for MSNBC, is think of running in his home state of Pennsylvania as a Democrat against you when you're up for re-election in 2010. A, do you believe these reports? B, what do you think?

SPECTER: Well, I'm going to have an opponent. In fact, I'm going to have two opponents, Wolf, one in the primary where I always have a tough race, and again in the general. I long ago adopted the philosophy of Satchel Paige, the old pitcher, and that is I never look over my shoulder, never look behind. Somebody may be gaining on me. I run with blinders. Wolf, I'll be prepared, whoever my opponents are.

BLITZER: Are you ready to try to get him defeated, Senator Menendez? You're in charge of getting Democrats elected to the Senate. If Chris Matthews decides to throw his hat in the ring, are you going to be with him?

MENENDEZ: Well, Wolf, we'll see who decides to run. I haven't seen any firm announcement by anyone in terms of running. Obviously, you know, we're going to be looking at the whole universe of seats that are up, keeping our incumbents strong and in a position to win re-election, looking at open seats that may become open, and then, of course, challengers. At the end of the day, we want to continue to build upon those who are willing to work with the president-elect in changing America and moving it forward.

BLITZER: You're in charge of getting Democrats elected to the Senate. You've heard these reports about Chris Matthews. Do you believe him? Have you spoken to him? Have you spoken to intermediaries on his behalf? MENENDEZ: I haven't spoke on the Chris or to intermediaries as to whether reports are true or not. You've been in the business a long time, Wolf, and we'll see when there are announcements and then we can judge them.

BLITZER: Go ahead, Senator Specter.

SPECTER: Wolf, I don't know what anyone else is doing, but I know what one man is doing -- Arlen Specter is running.

BLITZER: I know you are. We also wish you the best of health, Senator Specter.

SPECTER: Thank you, feeling good, on top of my game.

BLITZER: I'm happy to hear that, and so is Senator Menendez and all of our viewers. Appreciate it very much.

MENENDEZ: Thank you.

SPECTER: Nice to be with you.

BLITZER: Up next, tracking terror. Do the attacks in India lead back to militants in Pakistan? We're going to get insight from four Terrorism experts. More LATE EDITION, right after the break. (COMMERCIAL BREAK)

BLITZER: Welcome back to LATE EDITION. I'm Wolf Blitzer in Washington. Here's what we know right now about the terrorist attacks in India. At least 18 people dead, 273 more wounded. Eleven terrorists, according to Indian authorities, were killed, and Indian authorities also have one suspect who's said to be a Pakistani in custody.

For insight, we turn now to four terrorism experts. Sajjan Gohel is director of international security at the Asia Pacific Foundation. He's joining us now live from London. And here in Washington, the former CIA deputy director, John McLaughlin and Fran Townsend, the former White House homeland security adviser, and our CNN national security analyst Peter Bergen. Thanks to all of you for joining us.

Sajjan, I'll go to London first and I'll ask you, Indian authorities are blaming this Pakistani-based terrorist organization Lashkar-e-Taiba for what happened in Mumbai. Do you buy it?

GOHEL: Well, Wolf, Lashkar-e-Taiba is known to be an affiliate to the al Qaeda school of thinking. They, in fact, had provided a number of bodyguards to Osama bin Laden in the past. They were actually accused of being behind the attack on the Indian parliament in December 2001, which almost brought India and Pakistan directly into war with each other.

And they're known for carrying out what's called a fedayeen attack. That's called individuals that aren't suicide bombers. They try to kill as many possible and then die in a hail of bullets in the ensuing shoot out with the authorities. Very similar to the tactic that we saw in Mumbai just now. And they have transnational linkages. People in the U.K., Australia have been convicted for being members of the LET. And only a few weeks ago, they held a rally for 200,000 people in Muridke in Punjab in Pakistan. So they're a very active group with transnational linkages, and they have been accused of carrying out attacks in India in the past.

BLITZER: And they've also been accused of having links, Peter Bergen, to al Qaeda itself. And there have been suggestions over the years. Is this a joint operation, in your opinion?

BERGEN: I don't know, to be honest, Wolf, but certainly Lashkar- e-Taiba and al Qaeda share training camps.

BERGEN: We know that because, when the United States responded to the Africa embassy attacks in '98, the bombs that -- the missiles that went into those camps killed members of Lashkar-e-Taiba.

So, long allied with Al Qaida, and also a group that, as Mr. Gohel mentioned, a very large group.

I mean, when this annual gathering of this group happens, hundreds of thousands of people show up. It has a, sort of, above- ground capability, in the sense it has a nonterrorist wing, sort of, like Hezbollah, runs schools and these sorts of things.

So this is a very large organization. The Pakistani government has banned it in 2002, but it continues to exist under new names, and obviously continues to be pretty active.

BLITZER: John McLaughlin, you spent a career at the CIA, studying this group, other terrorist group. Is this group, Lashkar-e- Taiba, at least -- was it created by Pakistani intelligence?

MCLAUGHLIN: Pakistani intelligence was instrumental in helping to create it, at the outset.

These days, it's not at all clear that Pakistani intelligence has any direct control over this group. At one point, it...

BLITZER: What about rogue elements in Pakistani intelligence?

MCLAUGHLIN: I'm skeptical of that, at this point. I'm very skeptical of that. Because, for the most part, Pakistani intelligence is very responsive to civilian authority.

And at this point, I would say the larger problem is this. Pakistan has its own internal terrorist problem that is preoccupying the Pakistan intelligence and military.

And if anything, I would suspect that Lashkar may have gotten off the leash here and may be operating beyond the scope of any direction that it might have received in the past.

BLITZER: When you were President, Fran Bush's homeland security adviser, I assume you studied this group rather closely, Fran?

TOWNSEND: Absolutely. They've got incredible capability. And when you look at the sophistication of this attack, John and I were talking earlier about the attack against the Indian parliament. They had this capability.

But Pakistan has suffered its own bouts with terrorism, now, in the settled areas. This is well beyond anything that Pakistan would have sanctioned or supported.

I really think it's time for the Pakistanis -- and they've offered their assistance to the Indian government. It's time for them to put past tensions aside to focus on this common terrorism problem. Because I think there is actually a lot of operational information and intelligence they can share.

BLITZER: Indian authorities say 10 or 11 terrorists did all this damage, over three days, at 10 separate locations in India, Fran. Do you buy that?

TOWNSEND: Nonsense, complete nonsense. There's no way that a multipronged attack like this, as sophisticated, logistically, as it was, was carried out by 10 or 12 people.

It would have required people on the ground. They'll be very difficult to find, but there would have been ground support inside Mumbai, inside India. And that ought to be the name of the game, right now, is to identify them. Because, until you identify and wrap up the network, you continue to be at risk.

BLITZER: Because, Peter, this suggests there may be terrorists still at large, right now, who may have just blended in.

BERGEN: Indeed. And CNN's reporting that a cell phone was recovered with -- that had made calls to Pakistan, that appears to have been used by the people involved in this attack.

So, I mean, the investigation is very fluid. As Nic was reporting, the person in custody, saying that he's a member of Lashkar-e-Taiba, but clearly they're going to find other people.

BLITZER: What do you think, Sajjan? Because You've studied this your whole career.

GOHEL: Well, I think what's very interesting is that, if you look at the reconnaissance, the planning, the locations, they did their homework very well.

And as we've seen with transnational terrorism, there is an international component and there's also an indigenous network as well.

So they had to have had individuals underground that gave them specific information about locations like the Jewish Cultural Center. Because it's quite an obscure place. It's not something that most people in Mumbai would have even heard of in the past. But what I've heard is there were three specific pieces of intelligence. One was from the U.S., that, back in September, they intercepted information that suggested that hotels in Mumbai could be targeted. Secondly, in the Indian city of Rampur, Uttar Pradesh, Indian authorities arrested two people that again suggested that hotels in Mumbai could be targeted.

That information was passed to the Taj Hotel and other hotels in the city. And, in fact, Taj raised security for two months, and only last week reduced it.

So, it seems that there was this knowledge that something could happen, that there was something being planned. The transnational nexus between India and Pakistan was producing a lot of chatter, but tragically, unfortunately, the terrorists still were able to break through.

BLITZER: We're going the pick up that thought on intelligence with John McLaughlin, but we're going to take a quick break.

We have much more to talk about. Are the United States and its allies, right now, losing ground in the war on terror?

And later, the best political team on television takes a closer look at how these attacks will affect the president-elect and his transition to power. "Late Edition" continues after this.

(COMMERCIAL BREAK)

BLITZER: We're assessing the war on terror with Sajjan Gohel of the Asia-Pacific Foundation, former CIA deputy director John McLaughlin, former White House homeland security adviser Fran Townsend, and our national security analyst Peter Bergen.

John McLaughlin, listen to what Ratan Tata -- that's the chairman of the Tata Group, which runs the Taj Mahal Hotel in Mumbai, told our Fareed Zakaria. Listen to this.

(BEGIN VIDEO CLIP)

RATAN TATA, CHAIRMAN, TATA GROUP: The police were woefully inadequate in terms of equipment and in terms of being prepared. And it was only after the army and the commandos came in, and even they were, in relative terms, ill-equipped against these militants who were very well-trained, seemed to have a plan of action.

And it has led me to believe that what the city really needs is a crisis management group.

(END VIDEO CLIP)

BLITZER: Fareed's interview, by the way, with Mr. Tata, is going to come up at the top of the hour on "Fareed Zakaria: GPS."

But these suggestions that U.S. intelligence had some indications that a terror attack on hotels in Mumbai was in the works, passed that information on to India -- you know how this kind of situation works.

Give us some perspective on what this might mean, because that sounds like a pretty specific piece of information that you want to take precautions on.

MCLAUGHLIN: Well, what I -- my experience with the Indian intelligence services is that they are very good, individually, but they do not talk to each other as much as they should.

BLITZER: Within India?

MCLAUGHLIN: Within India. So it's possible that information was passed to them but didn't get fully circulated within the Indian system. Now, I don't know that for a fact, but that's what my experience would suggest.

BLITZER: Is that your experience, Fran, as well?

Because you've shared intelligence with friendly countries, and India is a very close ally of the United States.

TOWNSEND: That's right. Two things, Wolf. One, this probably isn't the only piece of threat information. While, looking backwards, it seems highly significant, it's probably not the only thing we were telling them about. And so this would have been one of several threat veins to be fair to the Indian government.

Second, because, just like we've found in our own country, where intelligence services don't always share information on a real-time basis, I think John's right.

TOWNSEND: That was probably an added impediment. But don't underestimate. There's been -- India has surfaced in threat information related to al Qaeda and terrorism a great deal in the last 12 months, and so I imagine this was one of many threats we were passing to them.

BLITZER: What do you think, Sajjan Gohel? You studied the Indian intelligence service and the security services for many years.

GOHEL: Well, India's two main intelligence agencies, the domestic one is the intelligence bureau, the external is the research and analysis link. Now of course, like most countries, there are disagreements and turf wars between them, but specifically on the information to deliver attacks to a hotels, they did pass it on to a number of hotels in Mumbai and also in Delhi that there could be attacks, because this year alone India has faced a number of different bombings throughout the major cities in Bangalore, Jaipur, also in Amdavad and in Delhi.

So, information was, I believe, passed on. But the problem was that it is up to them, to the hotels to take appropriate steps. I mean, the Taj only reduced their high level of security last week because they believe the threats had actually disappeared. Now obviously, these terrorists were biding their time. They were waiting for an opportunity to exploit the security, which is either lax, minimal, or nonexistent.

BLITZER: Here's what the prime minister of India, Prime Minister Singh, Peter, said on Thursday. I'm going to play this little clip.

(BEGIN VIDEO CLIP)

MANMOHAN SINGH, INDIAN PRIME MINISTER: We will go to these individuals and organizations and make sure that every perpetrator, organizer and supporter of terrorism, whatever his affiliation or religion may be, pays a heavy price for these horrific acts against our people.

(END VIDEO CLIP)

BLITZER: How worried are you, Peter, that there could be a miscalculation between India and Pakistan right now? And they're both nuclear powers.

BERGEN: We've seen that in the past. The Indian parliament attack in 2001 almost provoked a war again between India and Pakistan, which have fought three major wars in the last 50 years and one minor war.

However, both sides right now are seeming to make the right kinds of statements, particularly the Pakistanis, sending senior intelligence official, it seems, to be part of this investigation.

So right now, both sides are making the right kinds of statements. But if this does lead to rogue elements in Pakistan's military intelligence agency, that would change the game. You may recall Wolf that several months ago, the Indian government and the CIA basically accused rogue elements of Pakistan's intelligence agency of bombing the Indian embassy in Kabul. If there's another kind of, something similar to that, obviously, that would be very provocative as far as the Indians are concerned.

BLITZER: Terrorists no doubt would like to see tensions ratchet up between India and Pakistan. John McLaughlin, here's what worries me. That if the Indians start moving troops to their border with Pakistan, Pakistan will respond and move troops to its border with India. And those troops, many of them, will come from the Afghan border where presumably they're going after al Qaeda and the tribal areas. They're trying to help the U.S. in this war on terror. How concerned are you about potential?

MCLAUGHLIN: That's the thing I think we need to be most concerned about, Wolf. In fact, if I were looking for an al Qaeda hand in this, this may be giving them too much credit for strategic thinking, I would see that al Qaeda would encourage Lashkar-e-Taiba or some other group to do this precisely to achieve that outcome. Because al Qaeda has the sanctuary now that they're up there alone at that border. It is under some pressure both from the United States and from Pakistan, and this would be one way to relieve that pressure.

BLITZER: What's the most important lesson, Fran? If you were still advising the president of the United States on homeland security right now, and you see these soft target, as they're called, in Mumbai destroyed -- hotels, a Jewish cultural center -- what's the most important lesson you would tell the president of the United States right now, this is what the United States needs to do?

TOWNSEND: You know, the soft targets represent the most difficult kinds of targets to protect. Obviously, there are not unlimited resources in a private sector do this, and the government, there are too many, so the government can't do it.

The single best return on investment is your domestic intelligence capability. It's been a priority in the current administration. I expect it will continue to be a priority to build that capability. Director Mueller has worked more closely with state and locals to get information, to exchange information.

And this is the sort of thing, it's the prevention piece. You can't protect it once the attack is sort of in progress, but what you can do is try to prevent it by intelligence before.

BLITZER: Intelligence is the key to a lot of this. All right, guys. Thanks very much. We have to leave it right there. Barack Obama is preparing to roll out his national security team, including Hillary Clinton as the next secretary of state. We're going to talk about what we can expect to hear tomorrow from the president- elect. Three of the best political team on television, they're standing by live. LATE EDITION continues right after this.

(COMMERCIAL BREAK)

BLITZER: He's not president of the United States yet, but Barack Obama certainly has a lot on his plate. Let's talk about the transition to power with three of the best political team on television. CNN's Ed Henry is covering the president-elect in Chicago, there he is. And here in Washington, CNN senior political analyst Bill Schneider and the "Hotline" editor in chief and CNN contributor Amy Walter. Guys, thanks very much.

Ed, let's go to you first. We know that Hillary Clinton is going to be announced tomorrow as the next secretary of state. James Jones, the retired U.S. marine general, will be the next national security adviser. And Robert Gates will stay on as defense secretary. But you're now learning of more announcements tomorrow.

HENRY: That's right, Wolf. Two Democratic officials telling CNN we'll also hear officially that Janet Napolitano will be homeland security secretary, the governor of Arizona. Eric Holder will be attorney general, former top Clinton official, you'll remember, first African-American attorney general ever if he's confirmed. And third is Susan Rice will be the U.S. ambassador to the United Nations. Again, a former Clinton official.

And I can tell you, just a few moments ago I got off the phone with Senator John Warner, the highly respected Republican, former chairman of the Armed Services Committee. He told me that as he looks at this team, he thinks it's very, very strong. This coming from a Republican. He said he was on the phone recently with the president- elect in the last few weeks talking about putting all this together, and he says he's been struck by Barack Obama's courage, in the words of John Warner, in terms of bringing in so many high-powered people and not being concerned about some of them perhaps overshadowing the incoming president himself.

But as you know, there's going to be a very tricky balancing act here because this is a much more pragmatic group than perhaps Barack Obama campaigned on. You have Hillary Clinton who voted for war in Iraq.

HENRY: You have Robert Gates, who's been carrying out President Bush's Iraq policy. A lot of people on the left nervous that maybe that 16-month time line for pulling combat troops from Iraq may get more flexible, wolf.

BLITZER: Bill Schneider, here's how Barack Obama put it on Tuesday in describing what his goal is in assembling this new team.

(BEGIN VIDEO CLIP)

OBAMA: Given the extraordinary circumstances that we find ourselves in, however, I think it is very important for the American people to understand that we are putting together a first-class team and for them to have clarity that we don't intend to stumble into the next administration.

(END VIDEO CLIP)

BLITZER: He wants to hit the ground running, and so he's wasting no time putting this cabinet and the senior staff together.

SCHNEIDER: That's right. And there's a lot of people in Washington who will feel relieved. These are known quantities. They've been around for a while. And there's criticism, as Ed Henry mentioned, from some on the left who said, wait a minute, we voted for change. Interestingly, Ed Henry asked President-elect Obama, where is the vision for change? And he gave a very interesting answer. He said, "I realize some people are wondering where the change is going to come from. I'll tell you -- the change will come from me."

BLITZER: We have that clip, in fact. I'm going to play it, Amy, for you. This is what the president-elect told Ed in response to that question.

(BEGIN VIDEO CLIP)

OBAMA: What we are going to do is combine experience with fresh thinking. But understand where the vision for change comes from first and foremost. It comes from me. That's my job, is to provide a vision in terms of where we are going and to make sure then that my team is implementing.

(END VIDEO CLIP)

BLITZER: Is that going to be enough to reassure some on the left who say, you know what, this is not necessarily what we bargained for? WALTER: Well, I think we're going to look for a couple things. The first is there's the vision and then there's the managing which is, who is getting out front, who is actually setting the pace, et cetera, who's getting on television, who's making the statement, and I think you'll see that Obama keeping his team in line, keeping them on the same page will be very important.

But the second piece of this, too, is what policies will actually be. I think there's a lot of concern on the left, but you don't see it sort of bubbling to the surface in the way that we've seen maybe in other times where a real nervousness that comes out either publicly, making statements. You're seeing stuff certainly from the blogosphere, but for high-profile, liberals, you're just not hearing that, at least at this point.

I think there's a sit back and wait and let's see what the policies look like before we start getting worried about the people making those policies.

BLITZER: Guys, I want everybody to stand by because we have much more to discuss, a lot more politics, what's going to happen in the coming days.

Also coming up, the First Lady Laura Bush, she was a guest on one of the other Sunday morning talk shows today. We're going to bring you some of what she had to say. That's coming up in our popular "In Case You Missed It" segment. Stay with us, we'll be right back.

(COMMERCIAL BREAK)

BLITZER: We'll get back to the best political team on television in a moment. But first in case you missed it, let's check some of the highlights from the other Sunday morning talk shows here in the United States. On NBC, the First Lady Laura Bush, discussed the plight of women in Afghanistan.

(BEGIN VIDEO CLIP)

FIRST LADY LAURA BUSH: In certain parts of Afghanistan, because there are still so many very conservative people, women themselves are afraid. I met with a group of women parliamentarians, members of parliament, who were in the United States recently, and they said this is our chance. And if we don't take this chance, if we don't succeed now, then when will we ever be able to? And I think the main thing that says to me is that we need to stay with it. We have to continue to support them.

(END VIDEO CLIP)

BLITZER: On ABC, Republican Senator Richard Lugar and Democratic Senator Jack Reed discussed the U.S. response to the terror attacks in India, including the possibility of sending a high-level mediator to help ease tensions between India and Pakistan.

(BEGIN VIDEO CLIP) SEN. RICHARD G. LUGAR, R-IND.: There is a good opportunity at this point for the Indians and the Pakistanis to understand that the dissident group that probably caused this could cause harm to both of them. I think the suggestion that was made, that President-elect Obama send a very high-level person to the situation, underlines the need for diplomacy on our part.

SEN. JACK REED, D-R.I.: I think we have to start as we are. FBI agents are there on the ground. Increase intelligence efforts. Build this up. And if there's a strong indication on both sides that they're moving together and that we can play a productive role, yes, but I think you have to have that in place.

(END VIDEO CLIP)

BLITZER: Highlights from some of the other Sunday morning talk shows here on LATE EDITION, the last word in Sunday talk. And don't forget, coming up right at the top of the hour, right after LATE EDITION, 1:00 p.m. Eastern, "FAREED ZAKARIA: GPS." This week, Fareed speaks with Ratan Tata. He's the chairman of the Tata Group which owns the Taj Mahal Hotel in Mumbai.

(BEGIN VIDEO CLIP)

TATA: They didn't come through that entrance. They came from somewhere in the back. They planned everything. I believe the first thing they did was they shot a sniffer dog and his handler. They went through the kitchen. They knew what they were doing and they did not go through the front. All our arrangements were in the front.

(END VIDEO CLIP)

BLITZER: Stay tuned for the complete interview with Mr. Tata. "FAREED ZAKARIA: GPS" coming up at the top of the hour. More with our political panel when we come back. Stay with us. We'll be right back.

(COMMERCIAL BREAK)

BLITZER: We're back with three of the best political team on television, CNN's Ed Henry, Bill Schneider and "The Hotline's" Amy Walter. Bill, you're getting ready to go down to Georgia tomorrow to cover this race, this runoff race between the incumbent Republican Saxby Chambliss and the Democratic challenger Jim Martin. Set the scene for us.

SCHNEIDER: Well, first of all, the election isn't over. How about that? We've still got two races to go.

BLITZER: Two Senate races.

SCHNEIDER: Senate races in Georgia and Minnesota where they're counting ballots. Normally, if an incumbent is forced into a runoff, as Saxby Chambliss was, the incumbent is in trouble. It happened to an incumbent several years ago in Georgia.

But in this case, a lot of people are betting that Saxby Chambliss will pull it out, for a couple of reasons. He was very close to the 50 percent mark, and the Democrats will have to pump up turnout without Obama on the ballot. If however, there is a big surprise and the Democrat Jim Martin does win this race, that will really be a sign of Republican demoralization, and it will suggest that an Obama effect is taking place across the country and even in the south.

BLITZER: Here's what Saxby Chambliss, the incumbent, who's fighting for his political life right now this Georgia, what he said earlier today, listen to this.

(BEGIN VIDEO CLIP)

SEN. SAXBY CHAMBLISS, R-GA.: Jim Martin, my opponent, is committed to doing everything that the president-elect wants him to do, and I'm simply not going to do that. If we give him a blank check, then I think it will not be in the best interest of the country, and I'll continue to promote that over the next 72 hours.

(END VIDEO CLIP)

BLITZER: How does it look to you?

WALTER: I agree with where Bill is coming from. This is a very interesting tactic that Chambliss is saying right now, which is don't send the president-elect a blank check. It's something Republicans tried across the country. It wasn't that successful in many cases.

In this case, of course, it's isolated. You have not only the fact there's no Obama on the top of ticket, but he's not made his presence in this race yet. You don't see Barack Obama doing anything personally, his recorded phone calls, he's recorded a radio ad, but I think the reality is this is not a president-elect who's saying right now I need 60 votes in the Senate, go get them for me. He's trying to stay very much above the fray.

BLITZER: Yeah, because they do have, Ed Henry, as you know, the Democrats, 58 Senate voices. They don't have that magic number of 60 that can deal with a filibuster, given the arcane rules of the U.S. Senate. What was the explanation that you heard from Obama folks out in Chicago where you're covering this transition for the decision not to send Obama himself to Georgia to campaign for Jim Martin?

HENRY: I've been hearing two reasons in private from Obama insiders. First of all, the fact that during this transition period, given the financial crisis, given the potential national security challenges, we've seen play out in India this week, obviously, he wants to be focused on the transition.

The president-elect doesn't want to look like he's out and the campaign has never ended and he's out politicking, fund-raising, et cetera.

But secondly, there's something they're very delicate about. They've got to be careful, they say about in private, using his political capital this early. If Barack Obama was to go into Georgia with a very high-profile visit and then the Democrat loses, you know we'd all be out there saying immediately, well, he doesn't have as much of a mandate as he thinks.

They want to burrow down here in Chicago, focus in on rolling out this national security team, get the cabinet going and not get wrapped up in politics. That's why you sort of see him just sort of putting a toe in the water.

Here's why it matters big time, though. Every single vote in that Senate is going to make a difference on whether Barack Obama's stimulus plan passes, whether his health care reform passes, and so there will be some in the Democratic Party wondering if Barack Obama will regret not going to Georgia if the Democrat ends up not winning. Because every single vote, if they get up to 59, that could make a difference, Wolf.

SCHNEIDER: Important fact -- Georgia voted for McCain. It did not vote for Obama. That's why it's risky for Obama to go there.

BLITZER: And the Democrats, they sent Al Gore to campaign for Jim Martin, they sent Bill Clinton to campaign for Jim Martin. Barack Obama holding back. But we'll see if that actually winds up making a difference. We're going to leave it right there, guys. I will wish you a safe trip down to Georgia to help cover this race for us. A lot more on it coming up in "THE SITUATION ROOM" this week.

Up next though, a survivor from the Mumbai terror attack shares his dramatic story of how he escaped. You're going to want to hear this. Stay with us. LATE EDITION continues after this.

(COMMERCIAL BREAK)

BLITZER: For many who were in Mumbai during the terrorist attacks this past week, the scars from the ordeal are emotional. I spoke with one survivor about his experience.

(BEGIN VIDEO CLIP)

JONATHAN EHRLICH, OBEROI HOTEL SURVIVOR: There was a knock at my door and then the door bell rang and I couldn't quite figure out who was knocking on my door so late in the evening. There was no chance that it was the hotel service this late and so, I just laid there and about five minutes later, the first bomb went off and I went to my window and looked down and saw a lot of gray smoke coming up towards me.

And I moved to go into the hallway when the second bomb went off and the whole hotel shook and I knew something bad was about to happen. So I ran back out to the hall and I turned and I heard the word "bomb" and then something basically switched in my head and the adrenaline basically exploded in my chest.

I ran back into the room, packed my bags. I was actually leaving for a flight very early this next morning which was the main reason I didn't actually join Alex and his friend in the bar. I ran down the stairs and I was on the 18th floor. I probably covered that distance in about a minute and a half. Went into an area just outside of the lobby and there were several other guests who were standing around and I couldn't quite figure out what they were doing. I totally felt like a sitting duck. I didn't see any hotel security. I didn't see any hotel staff or any police.

And I just know I wanted to get out so I went from there into the hotel lobby. And it was empty. There was glass everywhere and blood on the floor and dead silence. So I knew that was not a good place to be. So I turned around and went back into that area where I had just come from and there were more people sort of standing around and I just knew, I said guys, we just have to get out of here. I felt totally like a sitting duck, as I said.

(END VIDEO CLIP)

BLITZER: One survivor's story. Jonathan Ehrlich speaking with me earlier. That is your LATE EDITION for this Sunday, November 30th. Please be sure to join me again next Sunday and every Sunday at 11:00 a.m. Eastern for the last word in Sunday talk. See you in "THE SITUATION ROOM" tomorrow. I'm Wolf Blitzer in Washington. "FAREED ZAKARIA: GPS" starts right now.