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STATE OF THE UNION WITH JOHN KING

Interview with John Brennan; Interview with Governor Tom Kean; Interview with Senators Jim DeMint and Claire McCaskill; "The Last Word" by Former CIA Michael Scheuer

Aired January 4, 2010 - 20:00   ET

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


GLORIA BORGER, CNN ANCHOR: I'm Gloria Borger. John King is off today. And this is STATE OF THE UNION.

(BEGIN VIDEOTAPE)

BORGER (voice-over): growing questions in the wake of the Christmas day terror plot.

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: It was a mix of human and systemic failures that contributed to this potential catastrophic breach of security.

BORGER: How did we miss the signs? And how will the administration make sure it doesn't happen again?

We'll put the questions to President Obama's top counterterrorism adviser John Brennan.

Then exclusive reaction and perspective from the man who wrote the book on preventing another terror attack, the former chairman of the 9/11 commission, Thomas Kean.

And two leading senators weigh in on how the U.S. should try this case. Republican Jim DeMint of South Carolina and Democrat Claire McCaskill of Missouri.

Then our "American Dispatch" from Salt Lake City, Utah where the mayor's attempt to liberalize liquor laws is get something some local push back.

And he says the attempted terror attack is fresh evidence that al Qaeda is figuring us out. "The Last Word" from Michael Scheuer, the former chief of the CIA's Osama bin Laden unit.

This is the STATE OF THE UNION report for Sunday, January 3rd, 2010.

(END VIDEOTAPE)

BORGER: We begin today with the latest on the failed Christmas day bomb plot. Joining us now is the man who's reporting directly to President Obama about what went wrong and how to fix it.

John Brennan, welcome to STATE OF THE UNION. Before we get to that Christmas day bomb plot, there's breaking news this morning that we need to talk about. And that is just hours ago the U.S. embassy in Yemen closed in response to threats from al Qaeda.

We know you've been briefed by General Petraeus and others, and General Petraeus was of course just in Yemen. Is there an imminent threat to all Americans there?

JOHN BRENNAN, ASST. TO THE PRESIDENT FOR HOMELAND SECURITY: I spoke with our ambassador in Yemen, Ambassador Seche, both this morning as well as last night, and there are indications that al Qaeda is planning to carry out an attack against target inside of Sana'a, possibly our embassy, and what we do is to take every measure possible to ensure the safety of our diplomats and citizens abroad.

So the decision was made to close the embassy, we're working closely with the Yemeni government and taking the property security precautions.

BORGER: Is this type of imminent threat there evidence of a ramped up threat by al Qaeda generally to move to American soil as we saw on Christmas day?

BRENNAN: I think what we've seen over the past several years in Yemen is increasing strengthening of al Qaeda forces in Yemen. There are several hundred al Qaeda members there, and from the very first day of this administration, we focused on Yemen.

I traveled out to Yemen twice. I've met with President Saleh. I spoke with President Saleh this week. We are very concerned about al Qaeda's continued growth, but they're not just focusing on Yemen as was evidenced by Abdulmutallab's effort to try and bring down that plane. They are, in fact, looking to the west. So that's why we have to get to this problem in Yemen now.

BORGER: But is this ramped up? Should we be more concerned today than we were three weeks ago?

BRENNAN: I think what it is, is showing that there's a culmination of the effort here of al Qaeda to carry out these attacks. We stopped a lot of these attacks and a lot of these plans long before they get to the execution phase. But what is clear is that al Qaeda, whether it's al Qaeda in the Arabian Peninsula or others, they're determined to continue pressing and continuing their attempts.

BORGER: So the answer to that is yes.

BRENNAN: I think we see continued attempts. Al Qaeda is determined to be successful. We keep thwarting their attacks, but they keep pressing.

BORGER: Well, you know, the director of National Intelligence, Dennis Blair, sent a memo to employees, and in it he says, and I'm quoting here, that "al Qaeda is diminished." Yet yesterday Michael Lighter, who runs the counterterrorism center, sent out a statement that said al Qaeda continues to refine their methods.

So which is it? Is it diminished or is it more sophisticated?

BRENNAN: It is both. We have made quite a bit of progress this year in degrading the capabilities of al Qaeda organization. We've taken the battle to them. We have eliminated a number of their senior leaders and operatives. But that doesn't mean that they still don't have capability to carry out attacks.

And that's what they're doing. They're trying to look for ways and vulnerabilities in our system to get their operatives either here to the United States or in other places to carry out these attacks.

BORGER: Should we raise the threat level here? Are you thinking about it?

BRENNAN: We have a system in place now that allows us to strengthen the security measures. That's what happened right after the attempted attack on December 25th. We didn't have to raise the threat level to red or another different color that is out there.

What we did was we immediately strengthened security precautions on planes and other places. So we feel comfortable that we are well- poised now.

BORGER: Right, but you feel comfortable. But then let's get back to the Christmas day plot because of course something went very wrong there. You are going to bottom line this for the president. You've received reports from every agency responsible for counterterrorism.

As you bottom line this, how severe was the failure?

BRENNAN: I think what -- clearly the system didn't work. We had a problem in terms of why Abdulmutallab got on that plane. There is no smoking gun piece of intelligence out there that said he was a terrorist, he was going to carry out this attack against that aircraft. We had bits and pieces of information. Let me just take a moment...

BORGER: Wait, wait. There was no smoking gun? The father went to the embassy in Nigeria, he's a well respected banker, and said I've gotten these terrible text messages from my son.

(CROSSTALK)

BRENNAN: Right. He said...

BORGER: Isn't that -- that's not a needle in a haystack.

BRENNAN: That was certainly an alert that came to our attention. He said he was consorting with extremists in Yemen. He didn't know what he was doing. He was concerned about him and he wanted our help.

That was one set of data. We had, though, other data within the intelligence system, bits and pieces of information, that didn't give us the clarity we needed to be able to map it and attach to Abdulmutallab. What we need to do as an intelligence community, as a government, is be able to bring those disparities and pieces of information together so we prevent Mr. Abdulmutallab from getting on the plane.

GRAPHICS: Well, for our viewers, I want for put up a timeline here. And you take a look at it over your shoulder. We see that Mr. Abdulmutallab was on the radar about last May when the United Kingdom revoked his visa to travel to Britain.

By the summer, into fall, the National Security Agency, the CIA, the National Counterterrorism Center, and Homeland Security all had pieces of this puzzle.

As you said, nobody put the information together. He bought a ticket for cash. He boarded an airplane in Amsterdam without a checked bag. And he had explosives in his underwear.

What got in the way?

BRENNAN: Well, first of all, when the British turned down Mr. Abdulmutallab for a visa, it was because of immigration concerns.

BORGER: Right.

BRENNAN: Because he put on his form -- a school that he wasn't -- that didn't exist. So that was not related to terrorism at all. We did have the information throughout the course of the summer and fall about al Qaeda in the Peninsula plans to carry out attacks.

We had snippets of information, we had information about Umar Farouk, but we didn't have any type of information that really allowed us to identify Mr. Abdulmutallab.

(CROSSTALK)

BRENNAN: The system did fail. It did not put the pieces together.

BORGER: But he-- as I said before...

BRENNAN: Everybody -- a lot of people buy their tickets in Africa with cash. That is the way in fact things are done because there's so much fraud there. So that wasn't a necessary bell. People in the Amsterdam airport didn't even know that he had bought the ticket for cash.

He did bring on carry-on luggage. So there are a lot of things that were out. We are now doing the diagnosis. We're going back and figuring out exactly how we could have stopped this early on.

BORGER: Are you saying that there isn't a way could you have stopped it, though?

BRENNAN: What I'm saying is that there was information that was in the system that should have allowed us to stop it. Yes. And that's what the president has, is to determine to make sure that we find out.

BORGER: What? What was the information that was -- I mean, where? Where?

BRENNAN: As you mentioned, it was the puzzle pieces. There were a number of pieces that were out there, but for whatever reason, they weren't brought together. We, as a government, need to make sure that we're able to bring those pieces together. Every day there are millions of pieces of the puzzle that come together on many, many people.

BORGER: But it sounds -- with all due respect, it sounds an awful lot like 9/11.

BRENNAN: No, that's...

BORGER: Pre-9/11. And my question to you is who is going to be held accountable?

BRENNAN: Well, first of all, it's not like 9/11. There was no indication that any of these agencies were intentionally holding back information. And I can point to millions...

BORGER: No turf battles?

BRENNAN: No turf battles. There were lapses, there were human errors, the system didn't work the way it should have. But no agency was trying to...

BORGER: Sloppiness?

BRENNAN: I think there were human errors and lapses and so what I'm going to do is to make sure they tell the president exactly what I think went wrong, but there wasn't an effort to try to conceal information.

I can point to many different examples this year that the FBI, Department of Homeland Security, and intelligence community combined to stop attacks. Najibullah Zazi...

BORGER: Can you give us an example that we don't know about?

BRENNAN: Well, there's a lot of classified information that is out there, and a lot of information that is -- relates to people who have been overseas that have tried to come here to the United States, but because we're working very closely with our partners overseas, they've been able to stop people before they have been able to get on a plane.

BORGER: Can you tell us about one?

BRENNAN: Najibullah Zazi, David Headley.

BORGER: Right.

BRENNAN: Other individuals that were captured. The five guys that left -- from Northern Virginia. When their parents brought it to the attention of the FBI, that's exactly the way the system should work. We went out there, we contacted the Pakistani authorities. They're currently in prison.

And what we're doing is trying to ensure that the system works as well in all these cases as in future events that come up.

BORGER: But let's switch now to the larger terror threat, which we were talking about at the beginning of the show. CNN is reporting that there's a radical American cleric born in Yemen, I'm sure very well-known to you, Anwar al-Awlaki, that had contact with both the shooter at Fort Hood and the Christmas day bomber.

If there's a link, do you now consider the Fort Hood shooting a terrorist attack?

BRENNAN: I think what we are clear about is that Mr. Awlaki was in touch with Hasan, with Major Hasan, and there are indications that he had contact, direct contact with Abdulmutallab.

Mr. Awlaki is a problem. He is clearly a part of al Qaeda in Arabian Peninsula. He's not just a cleric. He is in fact trying to instigate terrorism.

What we need to do now is to make sure that we can identify other individuals or other activities of Mr. Awlaki so we can stop it before it comes through.

BORGER: Is he alive?

BRENNAN: Awlaki? We are continuing to sort of press the -- and maintain pressure inside of Yemen. There are a number al Qaeda operatives in Yemen who are no longer alive that were last month.

BORGER: So was Fort Hood a terrorist attack?

BRENNAN: I think we're still taking a look at that. I mean, the term terrorism is defined many different ways.

BORGER: Well...

BRENNAN: In my mind, Mr. -- Major Hasan carried out this attack, it was inspired, I think, by some of the rantings and the rhetoric of individuals like al-Awlaki. And so they're looking at this right now.

BORGER: It is. So it was.

BRENNAN: It's certainly an act of murder. It was wanton murder. It was wanton slaughter of U.S. military officers.

BORGER: And let's talk about Guantanamo then for a moment, too, because there are reports that at least one prisoner released from Guantanamo in 2006, Ibrahim Suleiman al-Rubaysh, is now called the "theological guide," if you will, to al Qaeda in the Arabian Peninsula. He was involved in the Christmas Day plot.

Does it make you rethink your decision to release six prisoners back into Yemen last month from Guantanamo?

BRENNAN: No, it doesn't, because that was the result of a very meticulous and rigorous process that we've had in place since the beginning of this administration. Now let me put some facts out here. The last administration released 532 detainees from Guantanamo. During this administration, we have transferred in fact 42 of these individuals overseas.

I have been in constant dialogue with the Yemenis about the arrangements that are in place. Several of those individuals were put into custody as soon as they returned to Yemen. So we are making sure that we don't do anything that is going to put American citizens, whether they be in Yemen or here in the States, at risk by our decisions about releasing -- transferring these detainees.

BORGER: So you have 90 prisoners remaining in Guantanamo that are from Yemen. Half of them were slated to be sent back home. There is word now that they're not going to be sent back home to Yemen.

What are you going to do with them? Are you going to send them to Illinois?

BRENNAN: We haven't, you know, stopped the process as far as dealing with them. Many of them are going to be prosecuted, some under the Article 3 courts, and some under -- in military courts.

Some of these individuals are going to be transferred back to Yemen at the right time and the right pace and in the right way.

(CROSSTALK)

BRENNAN: And under that arrangement...

BORGER: So they still will go back to Yemen. And what do you mean at the right time and place?

BRENNAN: Well, we made a decision that we would send back six because we were very pleased with the way of Yemeni government handled the one individual we sent back about eight weeks ago. And so we're making sure that the situation on the ground is taken into account.

That we continue to work with the Yemeni government, and we do this in a very common-sense fashion because we want to make sure that we are able to close Guantanamo.

Guantanamo has been used as a propaganda tool by al Qaeda and others. We need to close that facility. And we're determined to do that.

(CROSSTALK)

BORGER: So -- so you're...

BRENNAN: The inmates that are there are going to be transferred back. Those that appropriate to go back, but also those that need to maintain -- stay in detention, we are going to do that. BORGER: So these 40 or so that are -- let me just make this clear. That this 40 or so that are slated to be sent back to Yemen, they still will be sent back to Yemen?

BRENNAN: We make a decision about when they are going to be sent back and how they're going to be sent back and under what conditions. And when...

BORGER: Has this slowed it down, is what I'm asking.

BRENNAN: The attempted attack by Mr. Abdulmutallab on Christmas day was a unique incident. We have been monitoring and watching the situation in Yemen develop over time. That one incident on the 25th of December doesn't change the situation on the ground in Yemen one bit.

We know that al Qaeda is out there. We know we have to be mindful of that. And we know that we have to take our steps with those detainees in a manner that is not going to put our citizens at risk. And we're not going to do that.

BORGER: So they will be sent back eventually?

BRENNAN: We're going to do it the right way at the right time.

BORGER: OK. OK.

BRENNAN: Absolutely.

BORGER: OK. Now, the president has said that we are at war with al Qaeda. You have said that. If we're at war, why not treat Abdulmutallab as an enemy combatant?

BRENNAN: Because over the past number of years, we have been able very successfully to charge a number of terrorists in court. Look at Richard Reid, the shoe bomber. He was tried. He was convicted. He was sentenced in court.

Zacarias Moussaoui, Iyman Faris, Jose Padilla, all of these individuals were tried in civilian court.

We try to adapt the tools in the right way. We are also a country of laws. This was an individual who was arrested on U.S. soil. If we decide at some point that we're going to charge and hold somebody under the enemy combatant status, it's a tool that is available to us. We made a decision to do this.

We have great confidence in the FBI and other individuals in terms of debriefing. We have great confidence in our court system so that we can use that to our advantage. And individuals in the past have, in fact, given us very valuable information as they've gone through the plea agreement process.

BORGER: And let me just ask you one more question about Mr. Abdulmutallab. Because there is a report in "Newsweek' this morning that you personally received intelligence from Saudi officials that al Qaeda might try to use an explosive hidden in underwear, what Mr. Abdulmutallab did.

What did you do with that information when you got it?

BRENNAN: Well, I think the report you're referring to is the attempted assassination attack against Prince Mohammed bin Nayef in late August.

BORGER: Yes.

BRENNAN: In fact, within a week of that attack, I was out in Saudi Arabia. I met with Prince Mohammed bin Nayef. I went to the room where the attack took place. We worked very closely with the Saudis to get that information. We shared it completely throughout the government.

PETN was the substance that was used in that attack. We were looking very carefully at that. There was no indication at the time that there was going to be an attempt against an aircraft. What we need to do is to try to stay ahead of it.

BORGER: Was the FAA put on alert about this, that people might be coming through airports with explosives in their underwear?

BRENNAN: There was nothing in that assassination attempt against Prince Mohammed bin Nayef that indicated aviation was a target. He was sitting in a (INAUDIBLE). The suicide bomber came in next to him. We were very concerned about the possible assassination attempts. And so we have been taking steps as we get this information...

BORGER: So the FAA didn't know? So the FAA didn't...

BRENNAN: Oh, the FAA, they get all of the information that is available to the intelligence community that relates to terrorist threats. And so we had that system working well, but clearly in the case of Mr. Abdulmutallab, the system didn't work the way it was designed to work.

BORGER: OK. And in conclusion, I'd just like to talk about the president for one moment. Three months ago, on October 6th, he said this at the National Counterterrorism Center. Just listen to this.

(BEGIN VIDEO CLIP)

OBAMA: You are setting the standard. You are showing us what focused and integrated counterterrorism really looks like. And the record of your service is written in the attacks that never occur, because you thwarted them.

(END VIDEO CLIP)

BORGER: Now on Tuesday, it was a very, very different President Obama who was a lot less complimentary about the intelligence services. Listen to this.

(BEGIN VIDEO CLIP) OBAMA: When our government has information on a known extremist and that information is not shared and acted upon, as it should have been, so that this extremist boards a plane with dangerous explosives that could have cost nearly 300 lives, a systemic failure has occurred. And I consider that totally unacceptable.

(END VIDEO CLIP)

BORGER: What is it the president know now that he didn't know three months ago?

BRENNAN: Well, first of all, the president takes his solemn responsibility to protect the well-being of the American people very seriously. I see it every day. I hear it every day. And he wants to make sure that we do everything possible in that regard.

What I think the president understands today is that the system is a very complex one, that there are ways to strengthen it. He is determined to strengthen it. We're very fortunate to have the people who are dedicated to doing this on a day in and day out basis.

When Americans were enjoying the holidays with their families and able to sort of watch football games and other things, there were very dedicated Americans at the National Counterterrorism Center, at the CIA, Department of Homeland Security, and FBI that are working around the clock to protect their fellow citizens.

But the president wants to make sure that that system that is in place is as good as it can be so that we don't ever have another instance when an individual gets on a plane anywhere in the world with a bomb trying to bring down an aircraft.

And he's determined to do that and I'm going to make sure that I do everything I can to support the president's wishes in this regard.

BORGER: Well, thank you very much, Mr. Brennan, for being with us today. Thank you.

BRENNAN: Thank you, Gloria.

BORGER: And up next, the former chairman of the 9/11 Commission will tell us what lessons we have yet to learn.

(COMMERCIAL BREAK)

BORGER: And joining me now to talk more about the foiled terror plot and the state of our homeland security is Thomas Kean, former Republican governor of New Jersey and the former chairman of the 9/11 Commission.

Thank you so much, Governor Kean, for being with us this morning. You heard what John Brennan had to say when pressed on the Christmas bomber plot. What's your general reaction to his responses?

THOMAS KEAN, FORMER 9/11 COMMISSION CHAIRMAN: Well, they were a bit defensive, and I guess that's probably understandable, given all the circumstances. But, you know, this -- this guy, in some respects, looking at it in retrospect, probably did us a favor.

I mean, look, we had an administration which was not focused as it should be on terrorism. And that's understandable. They were focused on health care and on global warming and the economy. That's very understandable.

Secondly, we weren't really focused on Yemen and the terrible things that are happening there. Now we are. And that's a good thing. And thirdly, there were holes, obviously, and the system wasn't working well. We found out it wasn't working well. The president understands it's not working well, and now we're focused on fixing it.

So, all over, thanks to -- thanks to God there wasn't any -- wasn't any serious injury, but the guy probably did us a favor now because now we're going to be a little more alert.

BORGER: Well, you heard what Mr. Brennan said. He said this was human failure. This was not a failure of people fighting each other on turf.

But when I asked him the question that you've been asking this week, which is about why not pay attention to Abdulmutallab's father, a wealthy Nigerian banker who walks into the embassy and is worried, he seemed to say that wasn't a direct clue.

KEAN: Well, that's -- that alone, given who that father was, his prestige in the community, his connections with the United States embassy -- that alone should have been enough. Because, think for a moment, if you're a father, or a mother, for that matter, and what it takes to go in there to a foreign embassy and actually turn in your child. I mean, this was an act of tremendous courage by this man.

BORGER: But Brennan's response was he didn't say his son was a terrorist.

KEAN: Well, that's not good enough. That's not a good enough response. Because that, to my mind, should have put everybody on alert. That should have gone right up.

And, you know, again, he said there were pieces of information. He's absolutely right, but he's wrong when he says this wasn't like 9/11. Because what we pointed out in the report, again and again, is that there were a lot of pieces of information that, if they'd been put together, then we might have deterred that plot.

This is the same thing. A lot of pieces of information -- if they had been shared -- shared by the intelligence agencies the way they should be and the way the system in Congress set up is designed to compel, then this guy would never have gotten on that plane.

BORGER: You know, we -- we've been spending a lot of time this week rereading the 9/11 report. We also -- which I happen to have here, and we've also been rereading that final report card when the 9/11 Commission did an update on where we were on -- on security issues. And this was in December 2005. Let me -- let me show this to you, a little bit. Airline passenger pre-screening, you gave them an F. Airline passenger explosive screening, you gave them a C. Government-wide information- sharing, a D.

Have the grades improved?

KEAN: I think they may have improved some. But, you know...

(CROSSTALK)

BORGER: Still an F in airline passenger screening, do you think?

KEAN: No -- no, I'd give them a little higher grade now, but still not good enough. I mean, we've got to be -- we've got to reach an A in that level. I mean, we cannot allow our people to get on a plane and not feel safe. So, you know, it still is not good enough. And -- but now, thank goodness, perhaps due to this incident, we'll get to where we should be.

BORGER: Let me ask you a little bit about the role of the president here. Has the president led forcefully enough, do you believe, to demand the sharing of information between these intelligence agencies?

KEAN: Well, the president now is saying the right things. And I believe he'll follow through and do the right things. The problem was not now but the fact before that this administration, I think, was distracted.

And I say that's understandable. I mean, heaven's sakes, if you're in this huge health care fight and worried about the economy and global warming and all that sort of thing, that's what they were concentrating on. And I think they weren't giving this enough attention. It's understandable, but it's not acceptable.

BORGER: So you're saying the president was not giving this enough attention?

KEAN: I don't think the whole administration was. And there are good people there. I mean, if you look at his Cabinet secretaries, the people who are involved in counterterrorism, they're good people.

I mean, they're good people. But they need support; they need coordination. The president needs to supply the leadership. And no matter what else is going on, this has always got to be number one.

BORGER: Well, Governor Kean,, thank you so much for your perspective on all of this, this morning. Thanks for being with us.

KEAN: Thank you.

BORGER: And it was a war of words this week on who is to blame for the security breakdown in the Detroit terror plot. Up next, we're going to hear from two senators with very different views on that. So stay with us. (COMMERCIAL BREAK)

BORGER: And welcome back to STATE OF THE UNION. I'm Gloria Borger, filling in for John King.

And with us now, two top U.S. senators, Democrat Claire McCaskill of Missouri and Republican Jim DeMint of South Carolina. Both are joining us from their home states.

Thanks to both of you for being with us this morning. Let me start with you, Senator DeMint. Your reaction, please, to John Brennan. He seemed to say that this was a failure of human error, not turf.

SEN. JIM DEMINT (R), SOUTH CAROLINA: Well, I was concerned before I heard him talk, and I think I'm a little more alarmed, because he seems to have a hard time saying that this is an act of terror, that Fort Hood was an act of terror, that the Christmas day bomber was an act of terror.

And unless we're willing to recognize this as a global war, in many cases, against the United States, I'm afraid we're going to fail to take the actions that we need to.

The most important point now, Gloria, is that this threat is real. And we need to make some very real changes from the last administration, from this administration. We need to get the politics out of it and focus on security.

But I was concerned that he would not give you direct answers, particularly about whether these were acts of terror or not.

BORGER: Senator McCaskill, we also spoke about the prisoners in Guantanamo. And half of those 90 prisoners are now slated to be sent home to Yemen. And John Brennan made the case that eventually at some point the administration believes that it will be able to send them back to Yemen. Is that a good idea?

SEN. CLAIRE MCCASKILL (D), MISSOURI: Well, first of all, I think what he said was we are being -- they are being very careful about how they're releasing any of these people. The previous administration wasn't quite as careful, frankly.

This administration, the people that have been released back to Yemen are in custody. And I think the full range of tools are being used -- military courts, civilian courts -- successfully.

And make no mistake here. He did not say that the act on December -- on Christmas was not an act of terror.

BORGER: Sure.

MCCASKILL: What he said was this administration, from day one, from the inaugural address, President Obama said very clearly and very forcefully that there is a war against terror and violence that is a vast network. And we have been taking it to that network through the intelligence community, through additional resources in Somalia and Yemen.

Unlike a myopic focus on Iraq, this administration is going worldwide in this war and is focused on it. And I think it is unfair and, frankly, political to take pot shots at the president as we respond to this failure in our systems that we've got to get fixed.

BORGER: Well, Senator McCaskill, very quickly, how should we be treating Abdulmutallab, as an enemy combatant or...

MCCASKILL: Well, I think that as they go forward with this investigation and develop leads -- as a former prosecutor, I can tell you they will be using this individual to try to get to more terrorists. And as they work with this -- this terrorist, they will make a decision on how to move forward.

You know, the shoe bomber is sitting in a prison in Colorado right now after going through a trial in our civil system and -- and -- and receiving severe punishment, along with dozens and, frankly, hundreds of other terrorists that we have prosecuted in this country.

We're not saying there shouldn't be military trials in some instances.

BORGER: Right.

MCCASKILL: What we're saying is the military and Justice Department should have choices as to how we can get these guys and get them with force and with the force of the American law.

BORGER: Senator DeMint, you want to respond?

DEMINT: Hey, Gloria, if we -- if we had treated this Christmas Day bomber as a terrorist, he would have immediately been interrogated military-style, rather given -- rather than given the rights of an American and lawyers. We probably lost valuable information.

It does come down to a decision of whether or not this is an act of war, an act of terror, or just a criminal act. So there's some real implications of the direction that's being taken now.

I agree with Senator McCaskill. We need to take the politics out of this. But there's no question that the president has down-played the risk of terror since he took office. He is investigating the CIA, rather than build them up.

BORGER: How has he -- Senator DeMint, how -- how has he down- played the risk of terror?

DEMINT: Well, it begins with not even being willing to use the word.

BORGER: Well, aside from the semantics...

DEMINT: And the move to...

BORGER: Aside from that. DEMINT: Aside from the semantics, he's been completely distracted by other things, as has already been mentioned, and he is not focused on building security and intelligence apparatus of our country.

The last administration, President Bush made a huge mistake by sending the Yemenis back. The core leadership of al Qaeda now is made up of those folks who were at the Gitmo prison. We can't make that mistake again.

So it's not just about this administration. It's about losing our focus on security. And I'm afraid politics and political correctness has become front and center of this debate.

MCCASKILL: You know that's just not true. This president has focused like a laser on how to keep this country safe. His commitment his Afghanistan, even though there are those in his party that were -- that were very critical of a position he took, he took the time and the energy to determine that us ramping up in Afghanistan should have been done a long time ago.

That's a -- a breeding ground for terrorists. This is a president that is taking strong action and is building up our intelligence community.

BORGER: Senator DeMint, Senator McCaskill, thanks for being with us this morning.

DEMINT: Thank you, Gloria.

MCCASKILL: Thank you. Happy New Year.

DEMINT: Happy New Year, Claire.

BORGER: You too.

MCCASKILL: Thanks, Jim.

BORGER: And up next a quick check of today's top headlines and then the man who has spent years tracking Osama bin Laden and al Qaeda. Former CIA analyst, Michael Scheuer gets the "Last Word."

(COMMERCIAL BREAK)

DON LEMON, CNN ANCHOR: We're following some breaking news here on CNN. Newark International Airport, Terminal C has been closed and no flights are leaving the terminal after a man walked through the wrong side of the checkpoint without being screened.

A spokesman for the TSA says police are looking for the man and reviewing video from airport security cameras.

Now travelers who had already passed through security checkpoints are being re-screened causing huge congestions and delays.

We want to go to our Alina Cho. She joins us now by phone. She's in the middle of it all.

What do you know, Alina?

ALINA CHO, CNN CORRESPONDENT (via phone): Hey, if I had to sum it up, Don, I would say that there is utter confusion at Newark Airport. I got off the flight from Fort Lauderdale about 45 minutes ago at Terminal C, the continental hub where this all happened.

Huge crowd here trying to get back so they can be re-screened through security. I talked to several people who were on flights for more than an hour. Essentially at one point the pilot got on the intercom made an announcement saying there has been a security breach.

Everybody has got to get off the plane. Including this one couple I spoke to from Staten Island headed to Mexico when I asked them, Don, "What now?" They said well, we're headed for a three-month vacation, so...

LEMON: Oh my gosh.

CHO: ... a couple of hours won't make much of a difference. But you can imagine, this is an extremely busy travel time. Tension is flaring there.

LEMON: It is extremely busy. I can see it there and I can the pictures that you took, Alina, with people waiting, Alina, waiting to get their luggage. Some people waiting to get in the airport and out of the airport. It's going to be a long night for those folks.

We'll update you at 10:00 p.m. Eastern here on CNN. I'm Don Lemon. "STATE OF THE UNION" continues next.

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BORGER: Fourteen newsmakers, analysts and reporters were out on the Sunday morning talk shows, but only one gets "The Last Word." That honor today goes to the former chief of the CIA's Osama bin Laden unit, Michael Scheuer.

Thanks so much for being here with us and getting "The Last Word" this morning. Obviously, we want to draw upon your CIA expertise, so let's get right to it.

John Brennan told us this morning that we are going to eventually -- and that's the key word here -- repatriate some of our Guantanamo detainees back to Yemen. I want to play for you what he said and get your response.

MICHAEL SCHEUER, FORMER CIA ANALYST: OK.

(BEGIN VIDEO CLIP)

BRENNAN: We haven't, you know, stopped the process, as far as dealing with them. Many of them are going to be prosecuted, some under the Article 3 courts and some under -- in military courts. Some of these individuals are going to be transferred back to Yemen at the right time, at the right pace and in the right way.

(END VIDEO CLIP)

BORGER: Is there a right way? Can they be rehabbed?

SCHEUER: No, they can't. The Saudis, the Yemenis -- they know our system better than we do in many ways. They know we like the idea of people being rehabilitated. So we send them back to Saudi Arabia; we send them back to Yemen, and they play records for them and they teach them how to paint, supposedly, and then they ship them off to kill our soldiers in Afghanistan or Iraq.

The whole repatriation business is just a nonsense. These people we hold at Guantanamo want to be released not to be free but to go back to the battlefield.

And Mr. Brennan, just like the last administration, is really portraying something to the American people that is the farthest thing from the truth.

BORGER: So, as you look at this right now and you see what's going on with al Qaeda in Yemen; you see the embassy closing just today, do you believe that the threat now is greater than it was just a couple weeks ago?

SCHEUER: It's greater than it was a couple weeks ago. But more importantly, it's much greater than it was on 9/11. We've killed some of their al Qaeda leaders, and every one -- every dead al Qaeda leader is a success, but all we have is a body count.

We now have al Qaeda, the main al Qaeda, in the Pakistan theater and Afghanistan theater. We have a fully fledged wing in Yemen. We have a fully fledged wing in Iraq, a fully fledged wing in North Africa, and a nascent wing in Somalia.

How can it be less threatening to us?

BORGER: Is the threat from al Qaeda greater in Yemen than it is in Afghanistan right now?

SCHEUER: No, certainly not. The threat, overall, from al Qaeda is melded together. It's an international organization. We tend to forget that a decade ago we knew that al Qaeda was in over 50 countries. They're in far more countries than that today.

BORGER: Well, let me -- let me play for you something. I asked John Brennan if al Qaeda, in fact, was diminished or more sophisticated. Let's hear what he had to say and then you can respond.

(BEGIN VIDEO CLIP)

BRENNAN: It is both. We have made quite a bit of progress this year in degrading the capabilities of al Qaeda organization. We've taken the battle to them. We have eliminated a number of their senior leaders and operatives. But that doesn't mean that they still don't have a capability of carrying out attacks.

And that's what they're doing. They're trying to look for ways and vulnerabilities in our system to get their operatives either here to the United States or in other places to carry out these attacks.

(END VIDEO CLIP)

SCHEUER: Mr. Brennan is blowing smoke. You have some dead bodies, I agree with that; it's all to the good, but no impact on the overall organization.

BORGER: So you don't think that it's at all diminished?

SCHEUER: No, as I said, I think it's stronger than it was at 9/11, certainly because the support and opposition across the Muslim world to American foreign policy is far greater today than it was in 9/11.

BORGER: So our plan right now is to double our aid to Yemen, which is still not a large amount of money, but say it's $160 million. Do you think that will matter, if we help the regime there try and get rid of al Qaeda?

SCHEUER: No. I think we tend to forget that one of the first people here with his begging bowl after 9/11 was Yemeni President Saleh. We've been dumping money and ordinance into Yemen since 2001. Al Qaeda has done nothing but grow there.

Mr. Brennan said there are perhaps 300 al Qaeda operatives in Yemen. I would say, if you doubled, tripled or quadrupled that number, you might get a tenth of what's there.

Yemen is bin Laden's ancestral home. More Yemenis than any Arab nationality fought against the Soviets. There would have been more Yemenis in the 9/11 attacks, except they couldn't get visas as easily as the Saudis.

Yemen is an al Qaeda country. And more than that, al Qaeda helped put President Saleh in power back in the '90s when there was a civil war in Yemen. There is no way Saleh can exist if he moves to crush al Qaeda.

BORGER: So what do we do?

SCHEUER: We -- you know, Theodore Roosevelt once said, "Fear God and take your own part." We stop depending on surrogates. We stop depending on Pakistan. We stop depending on Yemen and use our own strong right arm.

There is no -- there's no clause in the Constitution that says President Obama can delegate the defense of America to a Yemeni dictator.

BORGER: And before you leave this morning, I have to ask you finally about the CIA deaths this week. You, of course, spent 20 years at the CIA. SCHEUER: Yes.

BORGER: And you know what a great loss this is for the agency. How does this affect both morale and strategy as the agency expands its role?

SCHEUER: Well, I think it hurts morale to a certain extent, naturally, because of the deaths, but it hurts morale even more because one of the officers who got killed had arranged an operation in 1998 that would have killed or captured Osama bin Laden.

And Mr. Brennan was instrumental in preventing that operation from occurring. Instead he said the Americans should trust the Saudis to take care of bin Laden.

So it's a painful-- it's a painful death, but more importantly it's a death that didn't need to occur had Mr. Clinton -- Mr. Brennan, George Tenet, and Mr. Berger had the courage to try to defend Americans.

BORGER: Now I wish all of those gentlemen were here today to defend themselves.

SCHEUER: I wish they were, too. And I would be delighted anytime to talk with them in public.

BORGER: Right.

SCHEUER: And in any forum, ma'am.

BORGER: Well, hopefully we can arrange that one day.

SCHEUER: I wish. I would be delighted.

BORGER: I'm sure they'll want to answer your charge.

SCHEUER: I'm sure they would.

BORGER: But thank you very much for being with us here today, Mr. Scheuer.

SCHEUER: My pleasure, ma'am.

BORGER: And up next, we get out of Washington and head to the beautiful state of Utah, where John King caught up with one mayor who's looking to change the status quo by changing the local liquor laws.

(COMMERCIAL BREAK)

BORGER: Every week on STATE OF THE UNION, John King travels to a different state. And in this week's "American Dispatch," he sets his sights on Utah.

Utah is known for its strong Mormon values, but as John quickly learned, there are also those who are looking to shake things up. (BEGIN VIDEOTAPE)

JOHN KING, CNN ANCHOR (voice-over): Sunrise makes the Great Salt Lake all the more spectacular. And the bison wandering state parklands are another reminder of the wonders and the rugged terrain that greeted the early explorers.

A Mormon temple is a more modern landmark, a symbol of faith and conservative thinking that often defines Salt Lake City's image, sometimes to the consternation of its non-Mormon mayor, Ralph Becker.

MAYOR RALPH BECKER (D), SALT LAKE CITY, UTAH: We have an enormously diverse culture here. We live in as beautiful a natural setting as there is anywhere in the world. And part of what we need to make sure people understand who had come to visit here and who look to locate their businesses here and live here is that everyone is welcome here.

KING: The mayor's attempt at an image makeover includes liberalizing city alcohol policies. Gone is the rule that allowed no more than two bars per city block.

It's a change bar-owner Del Vance calls overdue, but also meaningless unless the state agrees to issue more liquor licenses.

DEL VANCE, BAR OWNER: Like everything here, it was a day late and a six-pack short, because now the state is out of liquor licenses, so even -- even if, you know, somebody wanted to open another bar on this block, they couldn't. There's no license available.

UNIDENTIFIED MALE: Founder of The Shoots (ph) went to the University of Utah.

KING: The state also controls liquor sales. And to Vance, it is proof the Church of Latter-Day Saints still dominates Utah politics.

VANCE: Obviously, you know, Utah is associated with Mormons, and they don't consume alcoholic beverages. I don't understand why some people think, well, if I don't do something, I've got to make it more difficult and aggravating for the person who does do it.

KING: For Art and Janie (ph) Brown, the anti-alcohol crusade began with a late-night phone call 10 years ago.

ART BROWN, HEAD OF UTAH MADD: I got a call for my daughter. And she simply said, dad, we've been in a very serious accident. And then, John, I guess the most poignant time in my life is when I had to watch my daughter, my son-in-law pull life support off that baby whom 24 hours before, it was a loving family, and then have to say goodbye, watch the baby turn color, and then walk out of the room.

KING: Matthew was 2 months old, killed by a drunk driver.

BROWN: He had been served over six hours 21 drinks -- over 21 drinks. When he got a little rowdy, they threw him out, got in his car, drove around, and hit our daughter. Three times the legal limit. KING: Brown heads the state's Mothers Against Drunk Driving chapter, and Utah's laws are among the toughest in the nation. He compliments Mayor Becker for dedicating resources to the fight against underage drinking, but Brown says allowing more bars downtown and in residential neighborhoods is dangerous.

BROWN: The wetter you get it for the kids where they live, the more probability that's going to be an upward pressure on their choices to drink. And if they see that you're willing to put it next door to them, that it's pleasurable, it's the thing to try, it's -- there's no downsides to it, it really ups their risk to trying this stuff.

KING: Mayor Becker disputes the link.

BECKER: I certainly understand and respect Art Brown and other -- others' points of view that having a place that serves liquor is an inducement for minors to drink. I just haven't found that to be case -- the case in my own experience, and I don't think the information in studies supports it either.

We're providing for what people in the neighborhoods want. They want to be able to walk to their neighborhood restaurant and have a drink with dinner, not everybody, but some people do. And we need to provide for everybody in our community.

KING: To the mayor, the question is quality of life in a changing city where the majority is now not Mormon. To others, a time to reflect on values they wish would not yield to shifting demographics and changing times.

(END VIDEOTAPE)

BORGER: One of the goals here at STATE OF THE UNION is to get out of Washington as much as we can. We've made it our pledge to travel to all 50 states in our first year. And you just saw John in state number 49, which leaves just one, that's Wyoming for next Sunday.

Check out CNN.com/stateoftheunion where you can see what we learned when we traveled to your state. John will be right back here next Sunday and every Sunday at 9:00 a.m. Eastern for the first and last word in Sunday talk.

Until then, I'm Gloria Borger in Washington. Thanks for watching.