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THE SITUATION ROOM

President Obama Holds Press Conference Regarding G-20 Meeting; Iran Given Deadline to Comply with U.N. Security Council Resolutions; Another Obama Administration Political Appointee Resigns amid Controversy

Aired September 25, 2009 - 17:00   ET

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


WOLF BLITZER, CNN ANCHOR: And, to our viewers, you're in THE SITUATION ROOM.

Happening now: the defense secretary speaking to CNN. Robert Gates knows you worry about Iran's nuclear ambitions. He has just sat down with CNN's John King. He says the Iranians are in a very bad spot because of what he calls -- and I'm quoting him now -- "deception."

Behind the scenes of history -- the new U.S. Supreme Court justice, Sonia Sotomayor, reveals the exact moment President Obama picked her to become the first Hispanic on the court.

And Bill and Hilary Clinton publicly intimate like we've rarely seen. He calls her the better public servant. She describes her pride in him. And then a kiss. You'll see it.

I'm Wolf Blitzer.

You're in THE SITUATION ROOM.

All that coming up.

We're also standing by this hour -- the news conference that the president of the United States will be holding in Pittsburgh over at the G20 Summit. It's wrapping up right now. He's running a little late. He'll be answering reporters' questions. As soon as he shows up at the microphone there, we'll go there. We'll take all of it live. That's coming up right here in THE SITUATION ROOM.

But let's bring in CNN's John King right now.

He's the anchor of CNN's "STATE OF THE UNION" -- you literally, John, are just walking into THE SITUATION ROOM from an interview you had with the Defense secretary, Robert Gates.

JOHN KING, CNN CHIEF NATIONAL CORRESPONDENT: Yes, Wolf. And I asked him questions about an issue that will no doubt come up when the president talks, as it did this morning, when you had the president of the United States with the prime minister of Great Britain and the president of France talking about this new, secret, underground Iranian nuclear facility that intelligence agencies have detected.

The question now is what happens next? The president says Iran has to come clean or face very tough sanctions.

I asked the Defense secretary, Robert Gates, what about somebody out there who says, we've heard this before, let's not wait any longer?

(BEGIN VIDEO CLIP, COURTESY

KING: I just want you to help an American out there who says we can't trust Ahmadinejad, this has been going on for years, we don't think sanctions will work, why don't we do something about it.

Explain to that person out there, whether they work in the United States Congress or whether it's just an average American, when you look at the contingencies that you have available to you and the president has available to him, are there any good military options when it comes to these deep underground facilities?

ROBERT GATES, SECRETARY OF DEFENSE: Well, without getting into any specifics, I would just say we obviously don't take any options off the table.

My view has been that there has been an opportunity, through the use of diplomacy and economic sanctions, to persuade the Iranians to change their approach to -- to nuclear weapons. The reality is, there is no military option that does anything more than buy time. The estimates are one to three years or so. And the only way you end up not having a nuclear capable Iran is for the Iranian government to decide that their security is diminished by having those weapons as opposed to strengthened.

And so I think, as I say, while you don't take options off the table, I think there's still room left for diplomacy -- the P5 plus 1. We'll be meeting with Iran here shortly.

The Iranians are in a very bad spot now because of this deception, in terms of all of the great powers. And there obviously is the opportunity for severe additional sanctions. And I think we have the time to make that work.

(END VIDEO CLIP)

KING: Interesting right at the end there, Wolf, severe additional sanctions -- very clear. And I thought that the Defense secretary was pretty candid -- yes, there are military options, but they're not so great.

So as the president said this morning, you hear his Defense secretary there saying let's see if the diplomacy can get this done. If not, then they will face more difficult decisions.

BLITZER: Because when you hear Gordon Brown, the prime minister of Britain, saying, you know, they're ready to draw a line in the sand right now, that clearly implies a military threat.

KING: Tougher sanctions first, a military threat down the road, that -- you mentioned the UK, France, the United States, tough language today. And they also -- a question on the table -- and I put it to Secretary Gates -- is also what about Israel, which, of course, lives right in the neighborhood?

BLITZER: Because in the past, he's been very, very blunt in suggesting the Israelis shouldn't even think about this because of the consequences that would follow.

KING: Leverage is a word he used in the interview, leverage, saying that because of this brazen deception by Iran, that he believes the international community now has much more leverage. We'll see if that plays out, because some would say we've had similar situations before and Iran has run out the clock.

BLITZER: Did you get any indication which way he's thinking about sending thousands of additional troops to Afghanistan?

KING: It is very clear that he wants this process to play out a little bit. He says the troops are available if the president -- it won't be easy because of Iraq and other deployments. But he says the troops are available if the president needs to go down that route. But it's very clear they want a little more time -- Wolf.

BLITZER: And the full interview airs Sunday morning, 9:00 a.m. Eastern, on "STATE OF THE UNION," is that right?

KING: That's right, 9:00 a.m. Eastern.

BLITZER: We'll be watching.

KING: Thank you.

BLITZER: John, thanks very much for that.

A political cliffhanger has now officially come to an end -- the U.S. Senate seat left vacant after Ted Kennedy's death is now officially occupied. Paul Kirk was sworn in today by the vice president, Joe Biden. On hand, Ted Kennedy's family, including wife and children, who became rather emotional in the process. And Senator Kirk's wife Gail, who was also rather visibly moved.

This swearing-in comes despite a Republican challenge to delay. Democrats now regain their powerful potential 60 vote majority.

Let's go straight to our senior Congressional correspondent, Dana Bash.

She's standing by.

You're right outside Senator Kennedy's old office -- Dana, how did it go?

DANA BASH, CNN SENIOR CONGRESSIONAL CORRESPONDENT: That's right. Well, you know, there obviously, as you said, is now an -- officially, a new senator from Massachusetts. But I want you to look at this, Wolf. This is the name plate. It still says very clearly "Edward M. Kennedy," outside of his office. Not just that, look inside here. This is reception room to Senator Kennedy's office. It's exactly the way it was the day he died. There are still pictures, floor to ceiling, of the senator, of his famous brothers, Robert and John, of memorabilia from his near half century here in the Senate.

This is where his replacement, the now Senator, Paul Kirk, walked into. He walked into applause of Senator Kennedy's aides and staffers standing in this room to greet him.

And, you know, I caught up with -- with Paul Kirk right afterwards. And I talked to him about it, about the fact that he is -- clearly was so close to Ted Kennedy. They were very good friends for years and years. And he himself was a former staffer and how that made him feel to come into this.

(BEGIN VIDEO CLIP)

BASH: Tell us what that was like, to go into that office, which is still filled with all the photos and all the memorabilia of all the yrs...

SEN. PAUL KIRK (D), MASSACHUSETTS: It's very hard to describe to you. Sobering, emotional and -- I know how they feel.

(END VIDEO CLIP)

BASH: Now, the emotion that Paul Kirk felt there was clearly palpable. And I can tell you, I was in the Senate chamber when he was sworn in. You could feel, Wolf, the history of the moment, because the bottom line is that this office -- it still says it right here -- has been held by Ted Kennedy for 47 years.

But it's important to remember that this was Ted Kennedy's last public request, to make sure that when he died, his seat was immediately filled in order to cast a vote, he hoped, for health care reform. And that is what happened today -- Wolf.

BLITZER: Congratulations to Senator Kirk.

Thanks very much for that, Dana.

By the way, we have another way for you to follow what's going on in THE SITUATION ROOM right now.

I'm now on Twitter. You can get my Tweets at Twitter.com/wolfblitzercnn. Remember Wolfblitzercnn -- that's all one word.

We're standing by for a news conference with President Obama at the G20 Summit in Pittsburgh. We're going to go there live. You're looking at live pictures from the event. As soon as the president gets to that microphone, we'll go to the news conference. You'll see the Q&A.

And it's a phone call few people will ever get -- a call from the president of the United States with an offer to become a United States Supreme Court justice. Sonia Sotomayor is now revealing what that felt like and a whole lot more.

(BEGIN VIDEO CLIP, COURTESY C-SPAN)

JUSTICE SONIA SOTOMAYOR: And I had the -- my cell phone in my right hand and I had my left hand over my chest trying to calm my beating heart, literally.

(END VIDEO CLIP)

(COMMERCIAL BREAK)

BLITZER: All right. We're told by the White House we're only a few seconds away from the start of this news conference by the president of the United States in Pittsburgh. He's at the G20 Summit, wrapping it up with leaders from the wealthiest nations around the world.

But high on the agenda on this day, the big story of the day, the US, France and the United Kingdom revealing that Iran has secretly had a second nuclear enrichment site. And the U.S. and the other allies, they want the Iranians to come clean. They have actually given an ultimatum to the Iranians. They have until December to do so. Otherwise, in the words of the British prime minister, Gordon Brown, there has already been a line drawn in the sand, presumably leading to even much more serious, serious sanctions.

Gloria Borger is our senior political analyst.

As we await the president, I'm sure most of the questions are going to be dealing with international events at this G20 Summit, specifically Iran and Afghanistan, as opposed to health care or the economy.

GLORIA BORGER, CNN SENIOR POLITICAL ANALYST: Right. And I think, look, this is the -- the news the president wanted to make today on Iran. So I think, in a -- in a way, he's going to welcome these questions, because he wants to make it very clear that he's acting very differently from the previous president; that he's acting in concert with our allies; that they are, together, making the case for stronger sanctions. They are, together, talking to Russia and China. And he also wants to be perceived as a leader who is leading the charge against Iran because of this discovery.

BLITZER: Well, it certainly came through earlier this morning, around 8:30 a.m. Eastern, when he and Nicolas Sarkozy and Gordon Brown...

BORGER: Right.

BLITZER: ...they walked out and spoke as one and issued a direct threat of sanctions to the Iranians.

BORGER: Right. Absolutely. And, you know, that -- that -- that was no mistake. They did it together. They said that the chancellor of Germany also agreed with them and could not -- and could not...

BLITZER: She has an election coming up this weekend...

BORGER: That's right.

BLITZER: That's why Angela Merkel...

BORGER: And -- and could not be there.

Now, on Afghanistan, I think that's where president is going to have some...

BLITZER: Here he is. The president is walking out right now. So as he gets to the microphone, we'll get ready to listen in.

Here's President Obama.

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: Good afternoon.

Let me, first of all, thank Mayor Luke Ravenstahl, County Executive Dan Onorato, and the people of Pittsburgh for being just extraordinary hosts.

Last night, during the dinner that I had with world leaders, so many of them commented on the fact that sometime in the past they had been to Pittsburgh -- in some cases, it was 20 or 25 or 30 years ago -- and coming back, they were so impressed with the revitalization of the city. A number of them remarked on the fact that it pointed to lessons that they could take away in revitalizing manufacturing towns in their home countries.

The people here have been just extraordinary, and so I want to thank all of you for the great hospitality.

I will tell you, I'm a little resentful, because I did not get to Pamela's Diner for pancakes, although Prime Minister Yukio Hatoyama of Japan did get pancakes. And I don't know how he worked that, but he was raving about them.

Six months ago, I said that the London summit marked a turning point in the G-20's efforts to prevent economic catastrophe. And here in Pittsburgh, we've taken several significant steps forward to secure our recovery in transition to strong, sustainable and balanced economic growth.

We've brought the global economy back from the brink. We laid the groundwork today for long-term prosperity, as well.

It's worth recalling the situation we faced six months ago: a contracting economy, skyrocketing unemployment, stagnant trade, and a financial system that was nearly frozen. Some were warning of a second Great Depression.

But because of the bold and coordinated action that we took, millions of jobs have been saved or created, the decline in output has been stopped, financial markets have come back to life, and we stopped the crisis from spreading further to the developing world.

Still, we know there is much further to go.

Too many Americans are still out of work and struggling to pay bills. Too many families are uncertain about what the future will bring. Because our global economy is now fundamentally interconnected, we need to act together to make sure our recovery creates new jobs and industries, while preventing the kinds of imbalances and abuse that led us into this crisis.

But Pittsburgh was a perfect venue for this work. This city has known its share of hard times, as older industries like steel could no longer sustain growth, but Pittsburgh picked itself up and it dusted itself off and is making the transition to job-creating industries of the future, from biotechnology to clean energy. It serves as a model for turning the page to a 21st century economy and a reminder that the key to our future prosperity lies not just in New York or Los Angeles or Washington, but in places like Pittsburgh.

Today, we took bold and concerted action to secure that prosperity and to forge a new framework for strong, sustainable and balanced growth.

First, we agreed to sustain our recovery plans until growth is restored and a new framework for prosperity is in place. Our coordinated stimulus plans played an indispensable role in averting catastrophe; now we must make sure that when growth returns, jobs do, too. That's why we will continue our stimulus efforts until our people are back to work and phase them out when our recovery is strong.

But we can't stop there. Going forward, we cannot tolerate the same old boom-and-bust economy of the past. We can't grow complacent. We can't wait for a crisis to cooperate. That's why our new framework will allow each of us to assess the other's policies, to build consensus on reform, and to ensure that global demand supports growth for all.

Second, we agreed to take concrete steps to move forward with tough new financial regulations so that a crisis like this can never happen again. Never again should we let the schemes of a reckless few put the world's financial system and our people's well-being at risk.

Those who abuse the system must be held accountable. Those who act irresponsibly must not count on taxpayer dollars. Those days are over.

That's why we've agreed to a strong set of reforms. We will bring more transparency to the derivatives market. We will strengthen national capital standards so that banks can withstand losses and pay for their own risks. We will create more powerful tools to hold large global financial firms accountable and orderly procedures to manage failures without burdening taxpayers. And we will tie executive pay to long-term performance so that sound decisions are rewarded instead of short-term greed.

In short, our financial system will be far different and more secure than the one that failed so dramatically last year.

Third, we agreed to phase out subsidies for fossil fuel so that we can transition to a 21st century energy economy, an historic effort that would ultimately phase out nearly $300 billion in global subsidies.

This reform will increase our energy security. It will help transform our economy so that we're creating the clean-energy jobs of the future. And it will help us combat the threat posed by climate change.

As I said earlier this week in New York, all nations have a responsibility to meet this challenge, and together we have taken a substantial step forward in meeting that responsibility.

Finally, we agreed to reform our system of global economic cooperation and governance. We can no longer meet the challenges of the 21st century with 20th century approaches. And that's why the G- 20 will take the lead in building a new approach to cooperation. To make our institutions reflect the reality of our times, we will shift more responsibility to emerging economies within the International Monetary Fund and give them a greater voice.

To build new markets and help the world's most vulnerable citizens climb out of poverty, we established a new World Bank trust fund to support investments in food security and financing for clean and affordable energy.

And to ensure that we keep our commitments, we agreed to continue to take stock of our efforts going forward.

Now, we have learned time and again that in the 21st century the nations of the world share mutual interests. That's why I've called for a new era of engagement that yields real results for our people, an era where nations live up to their responsibilities and act on behalf of our shared security and prosperity.

That's exactly the kind of strong cooperation that we forged here in Pittsburgh and earlier this week in New York. Indeed, on issue after issue, we see that the international community is beginning to move forward together.

At the G-20, we've achieved a level of tangible global economic cooperation that we have never seen before, while also acting to address the threat posed by climate change.

At the United Nations Security Council, we passed a historic resolution to secure loose nuclear materials, to stop the spread of nuclear weapons, and to seek the security of a world without them.

And as we approach negotiations with Iran on October 1st, we have never been more united in standing with the United Kingdom, France, Russia, China, and Germany in demanding that Iran live up to its responsibilities.

On all of these challenges, there is much more work to be done, but we leave here today more confident and more united in the common effort of advancing security and prosperity for all of our people. So I'm very grateful to the other world leaders who were here today.

And with that, let me take a few questions. I'll start with Ben Feller of A.P.

QUESTION: Thank you, Mr. President. The Iranian president said today that your statement of this morning was a mistake and that your mistakes work in Iran's favor. What gives you any sense that you can genuinely negotiate with him? And also, when you talk about holding Iran accountable, is the military option growing more likely?

OBAMA: I think it's important to see what happened today, building on what happened in New York. You had an unprecedented show of unity on the part of the world community saying that Iran's actions raised grave doubts in terms of their presentation that their nuclear program was for peaceful purposes. Not only did the United States, France, and the United Kingdom who initiated the intelligence that brought this to light stand before you, but you had China and Russia, as well, issue statements calling for an immediate IAEA investigation.

That kind of solidarity is not typical. Anybody who's been following responses to Iran would have been doubtful just a few months ago that that kind of rapid response was possible.

So I think Iran is on notice that, when we meet with them on October 1st, they are going to have to come clean and they are going to have to make a choice. Are they willing to go down the path which I think ultimately will lead to greater prosperity and security for Iran, giving up the acquisition of nuclear weapons, and deciding that they are willing to abide by international rules and standards in their pursuit of peaceful nuclear energy, or will they continue down a path that is going to lead to confrontation?

And as I said before, what has changed is that the international community, I think, has spoken. It is now up to Iran to respond.

I'm not going to speculate on the course of action that we will take. We're going to give October 1st a chance.

But I think you've heard that even countries who a year ago or six months ago might have been reluctant to even discuss things like sanctions have said that this is an important enough issue to peace and stability in the world that Iran would make a mistake in ignoring the call for them to respond in a forthright and clear manner and to recognize that -- that the choice they make over the next several weeks and months could well determine their ability to rejoin the international community or to find themselves isolated.

Last point I'll make, specifically with respect to the military, I've always said that we do not rule out any options when it comes to U.S. security interests, but I will also re-emphasize that my preferred course of action is to resolve this in a diplomatic fashion. It's up to the Iranians to respond.

Patricia Zengerle at Reuters?

QUESTION: You said a couple of months ago that the war in Afghanistan is a war of necessity. Do you think it's possible to meet U.S. objectives there without an extra infusion of U.S. troops? And as you consider this, how does the public's lagging support for the war affect your decision-making now? And how has your review process been affected by the allegations of election fraud? Thank you.

OBAMA: First of all, let me be clear on our goals. We went into Afghanistan not because we were interested in entering that country or positioning ourselves regionally, but because Al Qaida killed 3,000- plus Americans and vowed to continue trying to kill Americans.

And so my overriding goal is to dismantle the Al Qaida network, to destroy their capacity to inflict harm not just on us, but people of all faiths and all nationalities all around the world, and that is our overriding focus.

Stability in Afghanistan and in Pakistan are critical to that mission. And after several years of drift in Afghanistan, we now find ourselves in a situation in which you have strong commitments from the ISAF coalition, our NATO allies. All of them are committed to making this work, but I think there's also a recognition that after that many years of drift it's important that we examine our strategies to make sure that they actually can deliver on preventing Al Qaida from establishing safe havens.

Obviously, the allegations of fraud in the recent election are of concern to us, and we are still awaiting results. We're awaiting the IEC and the ECC issuing their full report.

What's most important is that there is a sense of legitimacy in Afghanistan among the Afghan people for their government. If there is not, that makes our task much more difficult.

In terms of the review process that we're going through, we -- the minute I came into office, we initiated a review and, even before that review was completed, I ordered 21,000 additional troops into Afghanistan because I thought it was important to secure the election, to make sure that the Taliban did not disrupt it.

What I also said at the time was that, after the election, we are going to reassess our strategy, precisely because so much of our success has to be linked to the ability of the Afghan people themselves to provide for their own security, their own training, the Afghan government's ability to deliver services and opportunity and hope to their people.

So we are doing exactly what I said we would do in March. I put in a new commander, General McChrystal, and I asked him to give me an unvarnished assessment of the situation in Afghanistan. And he has done that, as well.

But keep in mind that from the start my belief was -- and this is shared with our ISAF allies -- that our military strategy is only part of a broader project that has to include a civilian component, has to include a diplomatic component, and all those different factors are being weighed and considered at this point. And I will ultimately make this decision based on what will meet that core goal that I set out at the beginning, which is to dismantle, disrupt and destroy the Al Qaida network.

With respect to public opinion, I understand the public's weariness of this war, given that it comes on top of weariness about the war in Iraq. Every time we get a report of a young man or woman who's fallen in either of those theaters of war, it's a reminder of the extraordinary sacrifice that they're making. I know that our partners in Afghanistan feel that same pain when they see their troops harmed.

So this is not easy, and I would expect that the public would ask some very tough questions. That's exactly what I'm doing, is asking some very tough questions. And, you know, we're not going to arrive at perfect answers. I think anybody who's looked at the situation recognizes that it's difficult and it's complicated.

But my solemn obligation is to make sure that I get the best answers possible, particularly before I make decisions about sending additional troops into the theater.

John Dellna of KDKI (ph). Is John around?

QUESTION: Right here.

OBAMA: Good to see you, John.

QUESTION: Thank you, Mr. President. Let me ask you, while we were inside this very safe and secure and beautiful convention center, some 5,000 -- at least -- demonstrators were on the outside. Some caused some property damage; others just shouted their messages, much of which had to do that, while you believe the G-20 summit was a success and represents a positive sign, they see it as something devilish and destructive of the world economy, and particularly the economy of the poor. What's your response to those who are demonstrating and those who oppose this summit?

OBAMA: Well, first of all, I think it's important just to keep things in perspective for the people of Pittsburgh. If you have looked at any of the other summits that took place -- I mean, in London, you had hundreds of thousands of people on the streets. In, you know, most of these summits, there has been a much more tumultuous response.

And I think the mayor and the county executive and all the people of Pittsburgh deserve extraordinary credit for having managed what is a very tranquil G-20 summit.

You know, I think that many of the protests are just directed generically at capitalism, and they object to the existing global financial system, they object to free markets. One of the great things about the United States is that you can speak your mind and you can protest. That's part of our tradition.

But I fundamentally disagree with their view that the free market is the source of all ills.

Ironically, if they had been paying attention to what was taking place inside the summit itself, what they would have heard was a strong recognition from the most diverse collection of leaders in history that it is important to make sure that the market is working for ordinary people, that government has a role in regulating the market in ways that don't cause the kinds of crises that we've just been living through, that our emphasis has to be on more balanced growth, and that includes making sure that growth is bottom up, that workers, ordinary people are able to pay their bills, get -- make a decent living, send their children to college, and that the more that we focus on how the least of these are doing, the better off all of us are going to be.

That principle was embodied in the communique that was issued. And so, you know, I would recommend those who were out there protesting, if they're actually interested in knowing what was taking place here, to read the communique that was issued.

Laurent Lozano? Is Laurent here? There he is.

QUESTION: Thank you, Mr. President. I would like to follow up on Iran. Since Iran seems to be so blatantly in breach of its international obligations and with some of your allies, main allies, obviously, growing impatient, why even meet with the Iranians on -- on October 1st? And can you also explain to us what happened between the end of 2007, when an intelligence estimate cast doubts on the fact that Iran was pursuing nuclear weapons and this year? What credit should be given to such intelligence?

Well, first of all, with respect to the intelligence that we presented to the IAEA, this was the work product of three intelligence agencies, not just one. These intelligence agencies checked over this work in a painstaking fashion precisely because we didn't want any ambiguity about what exactly was going on there.

And I think that the response that you saw today indicates the degree to which this intelligence is solid and indicates the degree to which Iran was constructing an enrichment facility that it had not declared, contrary to U.N. resolutions and contrary to the rules governing the IAEA.

In terms of meeting, I have said repeatedly that we're going to operate on two tracks, that our preferred method of action is diplomatic, but if that does not work, then other consequences may follow.

I also said -- and this was debated extensively here in the United States, because there were some who suggested, you know, you can't talk to Iran, what's the point -- that, by keeping the path of diplomacy open, that would actually strengthen world unity and our collective efforts to then hold Iran accountable.

And I think you're starting to see the product of that strategy unfold during the course of this week. What we saw at the United Nations in the Security Council was a strong affirmation of the principles of the Nuclear Non-Proliferation Treaty. And as a consequence, the IAEA is strengthened and those countries who follow the rules are strengthened when it comes to dealing with countries like North Korea and Iran that don't follow the rules. And that means that, when we find that diplomacy does not work, we will be in a much stronger position to, for example, apply sanctions that have bite.

Now, as I said, that's not the preferred course of action. I would love nothing more than to see Iran choose the responsible path. Whether they do so or not will ultimately depend on their leaders, and they will have the next few weeks to show to the world which path they want to travel.

I'm going to take one last question. Yeah, I've got to call on one of these guys. You know, they're my constituency here. All right.

Chip?

QUESTION: Thank you, Mr. President. You just mentioned sanctions that have bite. What kinds of sanctions -- and I know you can't get into details -- but what kinds of sanctions at all would have bite with Iran? Do you really think any kind of sanction would have an effect on somebody like Ahmadinejad?

Secondly, some of your advisers today said that this announcement was a, quote, "victory." Do you consider it a victory? And if so, why didn't you announce it earlier since you've known since you were president-elect?

OBAMA: This isn't a football game, so I'm not interested in victory. I'm interested in resolving the problem. The problem is, is that Iran repeatedly says that it's pursuing nuclear energy only for peaceful purposes, and its actions contradict its words. And as a consequence, the region is more insecure and vital U.S. interests are threatened. My job is to try to solve that.

And, you know, my expectation is that we are going to explore with our allies, with the P5-plus-one, a wide range of options in terms of how we approach Iran, should Iran decline to engage in the ways that are responsible.

You just told me I'm not going to get into details about sanctions, and you're right. I will not. But I think that, if you have the international community making a strong, united front, that Iran is going to have to pay attention.

In terms of why we didn't come out with this sooner, I already mentioned to Laurent that it is very important in these kinds of high- stakes situations to make sure that the intelligence is right. And we wanted all three agencies -- the French, the Brits and the Americans -- to have thoroughly scrubbed this and to make sure that we were absolutely confident about the situation there. We are, and now it's up to Iran to respond.

OK? Thank you very much, everybody. I hope you enjoyed Pittsburgh. Thank you. (APPLAUSE)

WOLF BLITZER, CNN ANCHOR: The president of the United States wrapping up a 30-minute news conference with a long opening statement on the g-20 and then going into Q&A, almost all of the questions involving what's happening right now with Iran as well as with Afghanistan, the two big national security issues facing the Obama administration right now.

Very little on domestic issues, no questions on health care reform for that matter. Some earlier discussion by the president in his opening statement on the global economy.

A lot to digest right now, so let's begin to assess what we've just heard on this very busy news day. Gloria Borger is joining us, our senior political analyst, two CNN contributors joining us, Donna Brazile, the Democratic strategist, and Mary Matalin, the Republican strategist.

Let me go to you first, Mary, first. The president making the case together with the British and French leaders that the Iranians have a limited amount of time, Sarkozy, the French president, saying they -- they have a deadline. They have got to come clean by December or else. The "or else" is the big part.

MARY MATALIN, REPUBLICAN STRATEGIST: The "or else" is a very big part. And repeatedly this president said respond or there will be consequences. What are the consequences? There's repeatedly been these threats of all the options are on the table.

And we see in the Senate a vast 76 cosponsors, bipartisan, most liberal to most conservative, saying enough of the talk. We've got not until December, October 1st, P-5 plus 1, put up or shut up.

So to the president's credit, there's been a year now to the pursuit of talking, and now there is -- there appears to be a unity that it's time to put up -- again, put up or shut up. And it's bipartisan, and let's hope it's universal, and let's hope that we stick with it, the whole world, that is, because it sounds largely reminiscent of walking up to Iraq, where there were 17 resolutions that Saddam blew off.

Let's see if Ahmadinejad and the Iranians do put up.

BLITZER: It does sound very ominous and very similar to what the rhetoric was leading up to the invasion of Iraq, Donna, especially when you hear the prime minister of Britain, Gordon Brown, using words like "a line in the sand has now been drawn."

At one point he says what the Iranians have done, they have shocked and angered the whole international community. It sort of sounds like shock and awe going into Iraq.

And now the president, Donna, in this news conference actually saying if the Iranians don't comply with all the U.N. resolutions, he used the word "confrontation," and he went out of his way to volunteer that all options are on the table.

It does sound a lot like the rhetoric coming from then President Bush leading up to the U.S. invasion of Iraq.

DONNA BRAZILE, DEMOCRATIC STRATEGIST: Wolf, this is a very serious situation, and what the president laid out today and clearly where the administration officials are saying on background, is that the world is unified.

The P-5 plus 1, as Mary mentioned, the permanent members of the U.N. Security Council know that they are not just going to slap another round of sanctions on Iran if they fail to comply with international law.

They are willing now to put more on the table, to put more teeth into whatever they decide to do. I don't know exactly what that is. The president didn't spell that out.

But one thing we know for sure is that the Iranians believe that they can get up with opening up another facility, and now the world community is knowledgeable about it, and they have until October 1st. We know that deadline, and we'll see what happens at that point.

BLITZER: Well, they have talks on October 1st. That's when the Iranians are supposed to start complying. They have until December, according to Sarkozy, the French president, to actually do it, or else, he says the sanctions will be very, very severe.

It was interesting, Gloria, that that question about the intelligence, how confident are you in this intelligence knowing that the intelligence leading up to the war in Iraq was flawed about Saddam Hussein's weapons of mass destruction stock piles, which really didn't exist.

This president going out of his way now saying the U.S. intelligence community, the British and the French intelligence community, they believe they have very good intelligence.

GLORIA BORGER, CNN SENIOR POLITICAL ANALYST: You know, that's the difference between this and the lead up to the war in Iraq. The president publicly up front now has state that had we didn't want any ambiguity here.

He knows what happened the last time, and so he's -- he said -- he's on the record now saying the intelligence is solid, and that he believes if there is strong intelligence, then if diplomacy doesn't work, that they will now be, and because they are united and because they know the intelligence is solid, that they will in a stronger position to get tougher sanctions against Iran.

So, you know, that -- that's a really big difference here, Wolf. This is something that they clearly did not rush into in any way, shape or form because they wanted to make sure that their intelligence was well scrubbed.

BLITZER: I think somebody before the day is over probably is going to start putting together some sound bites from what we heard today from the U.S., British, and French leaders and start comparing them to what we heard leading up to the war in Iraq.

BORGER: Yes.

BLITZER: I suspect that's going to happen at some point.

Guys, thanks very much. We're going to continue to follow this story. It's a huge story, much more coming up.

Also, an alleged terror plot, or plots, I should say, all unfolding in the same week. Would-be terrorists allegedly target New York, Dallas and Springfield, Illinois. At least one expert thinks there's a disturbing reason why these terror probes are unfolding at the same time.

And another one bites the dust. One of President Obama's political appointees, the man who promoted the iconic hope campaign poster, is now out of a job. Some think he's is latest casualty of a conservative witch hunt.

(COMMERCIAL BREAK)

BLITZER: Another of President Obama's appointees is now out of a job. The National Endowment for the Arts spokesman Yosi Sergeant quit after being hammered by conservative pundits, and now some are asking is this White House caving too quickly to conservative pressure?

Our national political correspondent Jessica Yellin takes a closer look at whether there's a pattern here -- Jessica?

JESSICA YELLIN, CNN NATIONAL POLITICAL CORRESPONDENT: Wolf, another administration official bites the dust after coming and attack by a 24-hour news network. So is the administration caving to what the president calls cable chatter? The White House says no. You decide.

(BEGIN VIDEOTAPE)

YELLIN: President Obama is flexing his muscles as media critic, telling CNN's John King --

OBAMA: Right now in this 24-hour news cycle, the easiest way to get on CNN or FOX or any of the other stations, MSNBC, is to just say something rude and outrageous.

YELLIN: What would he prefer?

OBAMA: Part of what I would like to see is that all of us reward decency and civility.

YELLIN: Lately the administration has been taking plenty of incoming fire from cable news reports -- the latest casualty, Yosi Sergeant. He brought this art to the Obama campaign, then he went to the National Endowment of the Arts, that is, until FOX News's Glenn Beck targeted him as part of a scary propaganda effort. GLENN BECK, FOX NEWS HOST: It's an amazing thing to see when your president, your White House, your government is trying to trick you, use your tax dollars to change your mind. It's called propaganda.

YELLIN: The specific charge, that Sergeant politicized the NEA because on a conference call he urged artists to create work supporting volunteering around administration priorities, like, health care, energy, and the environment.

That was branded dangerously political, the drip, drip, drip of criticism continued, until in a statement Sergeant's boss said Sergeant acted unilaterally. Sergeant was demoted, then resigned.

That followed the fall of Van Jones, the president's special adviser for green jobs. He also landed in Glenn Beck's sights here on FOX News.

BECK: For the last couple of months, we have told you that he is an avowed radical communist, revolutionary.

YELLIN: Jones had some issues. He signed a bizarre 9/11 conspiracy petition and disparaged Republicans on tape.

VAN JONES, FORMER GREEN JOBS CZAR: The answer to that is they're (bleep) holes.

YELLIN: But it was his history as a leftist activist that interested Beck. Jones resigned last month. The White House did not fight to keep either Jones or Sergeant.

One Democratic strategist says the president isn't caving to pressure. He just doesn't like drama.

GEOFF GARIN, DEMOCRATIC STRATEGIST: This is really just a question of not whether this is a capital offense or not, but really just a question of could Barack Obama afford these kinds of distractions in a media environment where there's a lot of people who are more than willing to blow them up.

(END VIDEOTAPE)

YELLIN: And I spoke with a White House official who says they believe Yosi Sergeant did nothing improper in that conference call and that no laws were broken.

But they say they always want to be careful and so they have issued guidelines to all White House staff and agency staff on how to avoid what they call even the appearance of impropriety when meeting with outside groups -- Wolf?

BLITZER: Jessica Yellin, thank you.

The Clintons, both of them are together talking about their mutual admiration. We're going to tell you what they're doing. And relatives of the Americans who died in the Lockerbie bombing, at least two of them meet with the Libyan leader Muammar Gadhafi. What did he say and what didn't he say to them? One of them is here to tell us.

Stay with us, you're in the "Situation Room."

(COMMERCIAL BREAK)

BLITZER: On our political ticker, congratulations are in order to our White House Correspondent Suzanne Malveaux. "Essence" magazine has named her Journalist of the Year.

Suzanne has been with CNN for seven years. She's earned lots of praise during the last presidential election for work on the campaign trail, sit-down interviews with then candidate Barack Obama and wife Michelle.

"Essences" will formally award her the honor later tonight here in Washington. Good work, Suzanne.

Arizona Senator John McCain and former Massachusetts Governor Mitt Romney were at times bitter rivals during the 2008 Republican primaries. Come next Wednesday, though, McCain will actually be doing Romney a huge favor worth big bucks.

He and fellow Arizona Senator John Kyl are co-hosting a fundraiser for Romney at Chase Bank Field, home of the Arizona Diamondbacks. The $3,000 a person VIP reception and $300 a person luncheon will benefit Romney's Free and Strong America political action committee.

Remember, for the latest political news, you can always check out CNNpolitics.com. You can always get more information from me on twitter.com/WolfblitzerCNN, all one word.

Oftentimes a kiss is just a kiss. But when you're a former president, planting one on your wife who's the secretary of state, it can garner a lot of attention.

Bill and Hillary Clinton share a brief, intimate moment and heap lots of praise on each other at Bill Clinton's high profile gathering of world leaders. Let's bring in our foreign affairs correspondent Jill Dougherty. Jill, how did it go?

JILL DOUGHERTY, CNN FOREIGN AFFAIRS CORRESPONDENT: Well, Wolf, during the election campaign, former president Bill Clinton claimed if Hillary Clinton were elected, the country would get two for the price of one. And today we had a glimpse of how that might have turned out.

(BEGIN VIDEOTAPE)

DOUGHERTY: America's preeminent power couple together in a rare public opinion.

BILL CLINTON, FORMER U.S. PRESIDENT: I want to begin by expressing my extreme indebtedness to the Clinton global initiative to all of you who participate for giving me the first chance I have had in a week to see Hillary.

(LAUGHTER)

DOUGHERTY: From the former president, now head of the Clinton Global Initiative, to the current secretary of state, a show of gratitude.

BILL CLINTON: Most of what I know about what I do today I learned from her. And she has become the best public servant our family has produced. And I am very proud of her and honored that she came here.

(APPLAUSE)

UNIDENTIFIED FEMALE: Ladies and gentlemen, Secretary of State Hillary Rodham Clinton.

HILLARY CLINTON, U.S. SECRETARY OF STATE: It won't surprise you to hear that I am very proud of my husband. And I think what he has invented and brought to light here is extraordinary.

(APPLAUSE)

DOUGHERTY: Two policy wonks brought together by the issue of worldwide food security.

Mr. Clinton admits Mrs. Clinton had the right policy all along -- instead of handing out food to the hungry, helping people grow food to feed themselves.

BILL CLINTON: It was a wrongheaded policy. It persisted through Democratic and Republican administrations alike, including mine. We were all wrong. And she is determined to reverse it.

(APPLAUSE)

DOUGHERTY: A brief public display of affection, and they're off, separately, to change the world.

(END VIDEOTAPE)

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