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Herman Cain Interview; Pakistan Warns U.S. After Air Strike; DNC Attacks Mitt Romney; Newt Gingrich Scores Endorsements; Herman Cain Speaks Out About Allegations of 13-Year Affair

Aired November 28, 2011 - 16:00   ET

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


WOLF BLITZER, CNN ANCHOR: Happening now: Pakistan's prime minister warns that everything about his country's critical relationship with the United States has changed -- tension reaching a disturbing new level in the wake of a NATO air strike that killed two dozen Pakistani troops.

Also, the Democratic National Committee inserts itself in the Republican presidential primary, hoping to take out the candidate who may pose the greatest challenge to President Obama. We are talking about Mitt Romney.

And another candidate, Herman Cain, is live with us here in THE SITUATION ROOM this hour. We will talk about what is behind his decline in the recent polls, criticism of his 999 tax plan and much, much more. I'm Wolf Blitzer. You're in THE SITUATION ROOM.

He's the only candidate who has been consistently at the top of the polls in the volatile Republican race for the White House. That has Mitt Romney increasingly targeted by President Obama's supporters.

Now, in an unusual move, the Democratic National Committee is targeting Romney in an effort to sway the GOP nominating contest.

CNN's Joe Johns is working the story for us.

Joe, what is going on here?

JOE JOHNS, CNN SENIOR CORRESPONDENT: Well, Wolf, it certainly raises the question whose primary is this anyway? It was much easier to keep track of this when it was just Republicans fighting among themselves.

(BEGIN VIDEOTAPE)

JOHNS (voice-over): The latest salvo in the Republican nomination battle comes from the Democratic National Committee, the people who want to bring you four more years of President Barack Obama. You heard it right? It's the Democrats weighing in, those the choice is up to Republicans.

It doesn't take much of a cynic to see that by running a slickly produced attack ad in battleground states pointing out flip-flop contradictions in Mitt Romney's record on things like abortion, health care, and immigration, the DNC would like to shut Romney down, leaving candidates with piles of baggage like Newt Gingrich and Herman Cain, as the last men standing against the guy in the White House.

ED ESPINOZA, DEMOCRATIC CONSULTANT: We can say that Newt Gingrich has baggage or Herman Cain has baggage, but the truth is that Mitt Romney has got baggage too. There's going to be a Republican nominee, no matter who it is.

JOHNS: We do know that Romney has gotten the Obama campaign's attention. Just last week, they howled in protest after Romney's campaign aired as ad Democrats said was misleading. Their attack was on Romney's changes in direction, which raised questions about whether voters can trust him.

Republican strategist Ford O'Connell:

FORD O'CONNELL, REPUBLICAN STRATEGIST: During the primary, they are enormous liabilities because at end of the day I think a lot of Republicans are concerned about Mitt Romney because they feel he puts ambition above principle.

JOHNS: In case you need a reminder, the latest evidence of a Romney position switch is on the issue of immigration. In the last CNN national security debate, Romney went after Newt Gingrich for proposing humane treatment for undocumented immigrants with close ties to the community.

MITT ROMNEY (R), PRESIDENTIAL CANDIDATE: Amnesty is a magnet. People respond to incentives and if you can become a permanent resident of the United States by coming here illegally, you will do so.

JOHNS: Problem is, Romney used to sound more inclusive. The Gingrich campaign pointed out this 2007 Romney appearance on "Meet the Press."

ROMNEY: those people who have come here illegally and are in this country, the 12 million or so that are here illegally, should be able to sign up for permanent residency or citizenship, but they should not be given a special pathway, a special guarantee that all of them get to stay here for the rest of their lives.

(END VIDEOTAPE)

JOHNS: And in a 2006 interview with Bloomberg, Romney was quoted as saying that law-abiding people who pay taxes, learn English and don't get government benefits should be allowed to get in line for citizenship which sounds pretty close to what Gingrich has proposed. The Romney campaign today accused the Obama campaign of trying to distract attention away from the president's record -- Wolf.

BLITZER: Joe Johns reporting for us. Thanks, Joe, for doing a terrific job filling in on Friday for me. Appreciate it very much.

JOHNS: My pleasure, Wolf. Glad you had some time off.

BLITZER: Thank you.

Meanwhile, we're going to get back to politics in a few moments, but there's another critically important story breaking right now. Fiery anti-American protests in the streets of Pakistan with demonstrators burning both the American and NATO flags. Outrage is boiling over the wake of a NATO air strike on Saturday that killed two dozen Pakistani troops. The country's prime minister is warning this is the end of business as usual with the United States. We will hear from the prime minister in a moment in an exclusive interview.

But first let's bring in our Pentagon correspondent Barbara Starr with more on this deadly air strike and the fallout.

Barbara, what is the latest information you are picking up?

BARBARA STARR, CNN PENTAGON CORRESPONDENT: Well, Wolf, Pakistan is saying it is another violation of their national sovereignty by the U.S., by the U.S. military, and they're tired of it.

(BEGIN VIDEOTAPE)

STARR (voice-over): The death of two dozen Pakistani soldiers in a U.S. air strike along the Pakistan-Afghanistan border is the most serious cross-border incident since U.S. troops were sent to Afghanistan a decade ago.

A senior U.S. official tells CNN the situation with the Pakistanis is so sensitive, public comments from the administration are limited to announcing an investigation and offering condolences.

JAY CARNEY, WHITE HOUSE PRESS SECRETARY: We mourn the brave Pakistani service members who lost their lives.

STARR: With anti-U.S. demonstrations already under way in Pakistan, the U.S. military hopes an investigation into what happened may ease Pakistan's anger. But that's not likely.

UNIDENTIFIED MALE: Business as usual will not be there.

STARR: Pakistan holds a vital card, access into landlocked Afghanistan. The Pakistanis quickly shut down two border crossings. About 30 percent of the supplies for the war into Afghanistan comes through the checkpoint.

SETH JONES, RAND CORPORATION: If they hold it for more than a week or two to have a notable impact on U.S. operations in both eastern and southern Afghanistan.

STARR: But the U.S. has longstanding alternate routes. About 40 percent of supplies come through Russia and Central Asian truck routes. Pakistan has also called for the U.S. to leave an air base where CIA drone operations targeting al Qaeda and Taliban in Pakistan have taken place in the past.

But with billions of dollars in aid and military sales, senior U.S. lawmakers are also warning they are out of patience with Pakistan.

SEN. JON KYL (R-AZ), MINORITY WHIP: They need to understand that our support for them financially is dependent upon their cooperation with us.

STARR: The fear now is that either side may miscalculate as Pakistan vows to protect its sovereignty. Pakistan's radars on the border are focused on any threats.

JONES: I would suspect there is popular support now for a Pakistan retaliatory strike. This is a very, very dangerous period we're at between the United States and Pakistan.

(END VIDEOTAPE)

STARR: And, of course, there are other security implications as well. The United States has been trying to get Pakistan to crack down on al Qaeda, Taliban and other militant groups for months now. Don't expect to see the Pakistanis moving very fast on that any time soon -- Wolf.

BLITZER: Yes, level of support in Pakistan for the United States is dwindling rather quickly. Lots at stake.

Thanks very much, Barbara.

Let's continue the story.

Pakistani Prime Minister Yousuf Gilani is warning the deadly incident changes everything between Pakistan and the United States. He spoke exclusively with CNN's Reza Sayah, who is joining us now live from Islamabad.

Reza, he was very candid about Pakistan's relationship with the United States. Update our viewers what he told you.

REZA SAYAH, CNN CORRESPONDENT: Yes. He was.

And, Wolf, consider the situation the prime minister is in. On one hand, he has to address the public outcry here, a public that doesn't like the U.S. government, U.S. foreign policy. On the other hand he has to see how he can salvage an important relationship with Washington. These are two countries, Pakistan and the U.S., that have had a lot of low moments.

Today the prime minister said this is the lowest moment he has seen in his administration. He said it will never be business as usual until things change because public support is fading fast.

(BEGIN VIDEO CLIP)

SAYAH: Is your prediction that this relationship will continue with Washington?

YOUSUF RAZA GILANI, PAKISTANI PRIME MINISTER: That can continue on mutual respect and mutual interest.

SAYAH: Are you getting that respect?

GILANI: At the moment, not.

SAYAH: You're not getting that respect?

GILANI: If I can't protect the sovereignty of country, how can we say it's a mutual respect and mutual interests?

(END VIDEO CLIP)

SAYAH: This was clearly a prime minister who was angry after this incident. But it is important note that he wasn't shutting the door on Washington. He was very diplomatic. He delivered some very thoughtful statements. He said he doesn't want to cut ties with Washington, but things have to change.

What threat changes could be, it is not clear at this point, he said. That is going to up to Pakistan's parliament, Wolf.

BLITZER: You have been covering this story for a few years now in Islamabad, Reza. How do you see this dire situation playing out in the coming weeks and months?

SAYAH: I think a lot has to do with what U.S. CENTCOM's investigation shows.

Right now, they're being very remorseful and regretful, but they are not exactly corroborating Pakistan's version of what happened. There is still some question whether the NATO forces drew fire first from Pakistan's side. But if indeed U.S. forces made a mistake, they are going to have to go into diplomacy overdrive. They have to be less critical against Pakistan for the time being in an effort to win back some goodwill and do some damage control.

But in the past, these two countries have overcome seemingly insurmountable problems. It is very likely that somehow, some way they will do it again, but expect a very rough patch least in the short run, Wolf.

BLITZER: Good point. Reza, thanks very much.

I want our viewers to check out my blog on this very subject. Go to CNN.com/situationroom. I write about what Michele Bachmann said at that debate last week when she said that Pakistan is too nuclear to fail. Check it out. Read my blog if you're interested.

Let's go to Jack Cafferty right now. He has got "The Cafferty File" -- Jack.

JACK CAFFERTY, CNN ANCHOR: In politics, timing is everything -- and Newt Gingrich might just have it, timing. Just as the former House speaker surges in the polls, he's also getting some key endorsements.

For starters, the influential New Hampshire "Union Leader" editorial board is backing Gingrich. They say he's improved Washington before and in this race, he has the best shot of doing it again.

This conservative stamp of approval could go a long way in helping Gingrich, especially at a time when many conservatives are taking aim at his views on immigration. Meanwhile, another conservative, Sarah Palin, remember her, could throw her support behind Gingrich as well. One report suggests aides to Palin say that Gingrich is the most likely to score her endorsement.

And it's not just conservatives who have nice things to say about Newt Gingrich.

Former President Bill Clinton praises Gingrich in an interview with the Web site Newsmax. Clinton calls Gingrich "articulate" and says he tries to think of a "conservative version of an idea that will solve a legitimate problem." That's a Clinton quote.

Clinton suggests that Gingrich's approach will make independent voters take a hard look at him.

All of this has got to be keeping Mitt Romney up at night. However, it's yet to be seen if Gingrich will peak only to fade away like some of the other Republican candidates before him, but so far at least it seems that he has got some momentum that the others lacked. And it seems to be holding.

As for Gingrich, he may have his eyes set on another opponent, the one in the White House. As the nominee, Gingrich says that he would challenge Obama to Lincoln-Douglas-style debates. And he says Obama can use a teleprompter. Cold.

Here's the question: Will Bill Clinton's praise help Newt Gingrich win the nomination?

Go to CNN.com/caffertyfile and post a comment or my blog or go to our post on THE SITUATION ROOM's Facebook page -- Wolf.

BLITZER: That relationship, as you remember, I covered Bill Clinton when he was president, Newt Gingrich when he was speaker, and that was a very, very complicated relationship, I would almost say love/hate relationship between Bill Clinton and Newt Gingrich back in the '90s. We will assess that later in the week.

Jack, thanks very, very much. Good question.

He surged to the front of the Republican pack only to fall back in recent weeks. We're talking about Herman Cain. He is here to talk about the roller-coaster race for the Republican presidential nomination. What is behind his rise and recent fall? Herman Cain live here in THE SITUATION ROOM, that's coming up next.

(COMMERCIAL BREAK)

BLITZER: He certainly was a frontrunner. He isn't necessarily right now, but Herman Cain remains in the top tier of Republican presidential candidates. And he's working to reclaim frontrunner status with the first votes for the White House only -- only four or five weeks away.

Herman Cain is joining us here in THE SITUATION ROOM.

Mr. Cain, thanks very much for coming in. HERMAN CAIN (R), PRESIDENTIAL CANDIDATE: Mr. Blitzer, I'm happy to be here.

BLITZER: Call me Wolf.

CAIN: OK, Wolf.

BLITZER: OK.

(LAUGHTER)

BLITZER: Let's talk a little bit about one of the key national security issues facing the country right now, Pakistan. Michele Bachmann, in our debate the other night, she said Pakistan is, quote, "too nuclear to fail."

Do you agree with her?

CAIN: I do agree with her, but I would state it differently. We can't make Pakistan our friend, but we can make them respect us. It gets back to what I describe as peace through strength and clarity.

Our relationship with Pakistan has not been clear, at least from my vantage point and the vantage point of a lot of other people.

BLITZER: What would you do differently?

CAIN: What I would do differently is I would better define what is the relationship? What -- they're getting aid from the United States of America. What are we getting for that aid? How do we define when the relationship has been broken or a rule has been broken?

It's been very unclear. And, as a result, we have a very unclear relationship with Pakistan right now.

BLITZER: Because they have a huge nuclear arsenal --

CAIN: Yes.

BLITZER: -- right now. And if Pakistan were to become an extremist Islamist state --

CAIN: Yes.

BLITZER: -- supported by al Qaeda or whoever --

CAIN: Right.

BLITZER: -- that could have enormous ramifications, not just for the region, but for the world.

CAIN: The only thing that saves -- that helps us is that General Kayani, who is in charge of that, is a man of principle. He would not let that happen frivolously and he would do everything he can to make sure that he did what was in the best interests of Pakistan. So I have faith in him because I've actually talked with someone who went to school with him. He's a man of principle and he would not do something just because of pressures from some extremist force.

BLITZER: He could be removed, too, General Kayani.

CAIN: He could be removed, but we can't control that either. He could be removed. But for right now, he, General Kayani, is the one that I think is going to maintain a certain amount of stability there.

BLITZER: All right. This is -- but the crisis that's unfolding right now. NATO had an air strike, killed 24 Pakistani soldiers over the weekend.

CAIN: Yes.

BLITZER: It's causing a major rift in U.S.-Pakistani relations.

If you were president right now, what would you do to contain this crisis?

CAIN: The first thing I would do is ask the government of Pakistan to let's figure out the facts of what happened. There's one report that the U.S. NATO -- that NATO forces may have been provoked. We don't know the answer to that yet.

So I would say could we first do a full investigation before we start finger-pointing and before we start saying this is what the United States ought to do, NATO ought to, what Pakistan ought to do?

Let's get the facts first. That's what I would do first and encourage them to do that.

BLITZER: The other -- another international issue, the European economy right now.

CAIN: Yes.

BLITZER: The Eurozone could collapse. It could have dramatic ramifications --

CAIN: Yes.

BLITZER: -- on the United States because some American banks, big banks, could collapse, given their involvement in Europe's economy.

CAIN: Right.

BLITZER: Under those circumstances and if you were president, would you intervene to bail out Europe?

CAIN: No, I would not. And because I would have already made sure we had our economy growing. Wolf, the United States economy is 25 percent of the world economy. As we grow, we are able to help spur growth in other parts of the world. That is the root cause. The best thing we could do to help Europe is to have a thriving economy and bringing our debt down.

BLITZER: But -- but that's a long-term strategy. That's going to take a while.

CAIN: Yes.

BLITZER: Europe could collapse -- the economy over there could collapse within weeks if you look -- read all those financial reports coming out of Europe.

CAIN: Right.

BLITZER: A lot of Americans potentially could lose their life savings if they have invested in some of these banks.

CAIN: I don't think they're going to lose their life savings. Will they lose some of it? Yes. In other words, the people who are saying that this is Armageddon if Europe fails, if America doesn't act, I simply do not buy that.

BLITZER: Because?

CAIN: Because after the last meltdown, at the end of 2008, banks, if they were smart businesspeople, started to take some precautions in the event that something like that happened again. So I can't believe that they didn't make some safeguards to make sure that they are not totally wiped out, like they possibly could have been in the last one.

BLITZER: Would -- would you support bailing out the American banks if they were on the verge of collapse because of what's happening in Europe?

CAIN: No. And here's why. I do believe in too big to fail. For example, if one of the big banks says we can't make it without government help, then go through the normal bankruptcy laws and the bankruptcy channel. Because what happens when a company is forced to go through bankruptcy, it restructures and then some of the surviving banks will pick up some of the pieces. That's why we have bankruptcy laws.

BLITZER: But if those banks collapse, there's a limited amount of insurance that would pay for it -- that would reimburse the people who had their life savings there. But a lot of folks would lose a lot of money.

CAIN: Well, that -- that possibly is the case. But here's what I don't believe, Wolf. I don't believe that all of the banks are going to collapse at the same time.

BLITZER: Not all of them.

CAIN: Right.

BLITZER: But those who are heavily --

CAIN: Exactly. BLITZER: -- invested in Europe would have trouble.

CAIN: Exactly. They would have -- they -- the ones that are heavily invested in Europe would be the ones to have the greatest amount of trouble. You're absolutely right.

BLITZER: Let's clarify your position on illegal immigration.

CAIN: Yes.

BLITZER: We heard what Newt Gingrich said the other day. We heard what Mitt Romney said. Newt Gingrich said if a family has been here for 20 or 25 years, they've been paying taxes, go to the church, there should be a way not necessarily to allow them to become citizens, but to make them legal residents of the United States.

CAIN: Right.

BLITZER: Are you with Newt Gingrich on that?

CAIN: No, I'm not. Remember, I have said that we've got four problems -- secure the border for real, promote the path to citizenship that's already there. If you've been here 25 years, still go through the normal path to citizenship. It's not that --

BLITZER: That means you have to leave the country and apply for a visa to come back in?

CAIN: I don't know if you necessarily have to leave and apply for the visa to come back in. But what I'm saying is our biggest problem with that is the bureaucracy surrounding the process, because I've talked to a lot of people who've come here legally. I've talked to a lot of people who have come here and gone through the process. And they've talked about how burdensome and bureaucratic it was.

I support the current path to citizenship, not a new path to establish, you know, a legal -- a legal sort of classification or something else.

BLITZER: So if you were president and you have 12 million illegal immigrants in the United States and let's say -- I'm just throwing out a number -- eight million of them have established roots in this country, what would you do?

What would you tell those people?

CAIN: I would empower the states. That's where I differ from a lot of other people. When I talk about my four part solution to the illegal immigration problem, secure the border for real, promote the path to citizenship that's already there, enforce the laws that are already there. And the way you do it is you empower the states. Let each state decide how they want to deal with illegal --

BLITZER: So if New York State, for example, said, you know what, there's a million illegal immigrants here in New York State, we're going to let them stay and give them legal residence -- CAIN: And --

BLITZER: -- if you were president, that's OK with you?

CAIN: If it doesn't break any federal laws.

BLITZER: Well, what does that mean, if it doesn't break any federal --

CAIN: Well --

BLITZER: -- they're here illegally, so that's broken --

CAIN: They --

BLITZER: -- the federal law --

CAIN: -- they've already --

BLITZER: -- already --

CAIN: Right. They've already broken it. But what I'm saying is I want the states to be empowered to enforce federal law. Now, if they want to something different to deal with the illegals that are already here, I believe that we empower the states to do it. A one size fit all is what I'm saying will not work, which is why I want to send it to the states.

BLITZER: The -- the whole notion of illegal immigration has come up because of Rick Perry. You remember, he got into deep trouble --

CAIN: Yes.

BLITZER: -- because he said that children of illegal immigrants who've grown up in Texas --

CAIN: Right.

BLITZER: -- should be eligible for in-state tuition.

Are you with Rick Perry on that?

CAIN: I'm not with him on that for the following reasons. We are a nation of laws. And we should not do anything that's going to compromise our laws or, as some people interpret that, put people who are children of illegals in front of kids that are here that was -- that were born here, that their parents were born here.

We have to stick to the laws. If you look at Mexico, that 40 percent of the people in Mexico already believe that Mexico is a failed state.

Why?

Because of the lawlessness. And I do not believe we should go down that road no matter how much it might appear to become compassionate.

BLITZER: Mr. Cain, I want you to stand by, because we have a lot more to talk about.

We're also learning about some new developments involving Herman Cain and we're going to talk about this.

There's a breaking news story that is just developing.

Stick around. We'll share it with you, when we come back.

(COMMERCIAL BREAK)

ANNOUNCER: This is CNN breaking news.

BLITZER: All right, we're just learning from Herman Cain himself that a third woman is about to come out and make some serious accusations against him. We all know the first two women --

CAIN: Yes.

BLITZER: -- accusing you of sexual harassment.

CAIN: Right.

BLITZER: What can you tell us about this third woman who is about to going public and accuse you of what?

CAIN: This particular individual, which will be named in the story, as we understand it -- my attorney has talked with the reporter who is going to come out with this story.

This individual is going to accuse me of an affair for an extended period of time. I don't want to specify, because I don't know what's in the story.

Secondly, it is someone that I know who is an acquaintance that I thought we are a friend. That much I do know.

But other than that, Wolf, when we dealt with the previous allegations and I went forward, went in front of the public and said they're false and they're baseless, we did -- we were reacting to what we knew.

At this point, I'm just simply saying these are going to come out. And until we know what they are, then my attorney doesn't know what to respond to.

Those are the -- all of the details that I have.

Now, given that, I know that the court of public opinion is going to formulate its own opinion. I can't control people who are going to make a decision based upon accusations. When specifics are made, through my attorney, because we are trying to run a campaign. Were trying to connect with the people on the issues. Through my attorney, we will respond to every detail and every allegation. But I just wanted to give you a heads-up and your audience a heads-up, here we go again.

BLITZER: Because we have learned -- and I knew this a while ago, earlier in the day, that an Atlanta TV station has been saying they've got explosive new information --

CAIN: Yes.

BLITZER: -- that could shake up the national race for the Republican presidential nomination.

So what I understand you saying is that this Atlanta TV station --

CAIN: Yes.

BLITZER: -- has been in touch with you and your attorneys --

CAIN: Yes.

BLITZER: -- and has told you what they have. And they've asked for your response.

CAIN: Right. But they haven't given us all of the information they're going to put in the story. So we don't have --

BLITZER: What did they say to you?

CAIN: They just said, you know, they -- they mentioned the name of the individual --

BLITZER: And you know this woman?

CAIN: And I do know who -- who she is. And they mentioned what the accusation is going to be. But until the story comes out, I'm not at liberty to respond to something, at this point.

Now, when the story breaks, through my attorney, Lin Wood, of Atlanta, Georgia, we will respond.

We chased all of these other rumors for two weeks before. And as it turned out, they were baseless.

Why?

Because they weren't able to come up with any documentation, any proof or anything that was credible.

And so we will address these when they come out. But at this point, I just wanted to give you a heads-up. I don't have anything to hide. And we will address every one of the details as we know them.

BLITZER: Well, tell us the nature of your relationship with this woman.

CAIN: Friend and trying to help a friend because not having a job, etc. And this sort of thing. That's all there is to the relationship.

And here again, I don't know what's going to be claimed in the story. It was someone who was supposed to be a friend, but, obviously, they didn't see it as a friendship. BLITZER: And when you say friend, was it an a -- I mean I'm asking. These are awkward questions, but I'll ask you the questions you're going to be asked.

Was this an affair?

CAIN: No, it was not.

BLITZER: There was no sex?

CAIN: No.

BLITZER: None?

CAIN: No.

BLITZER: And if this woman says there is, she's lying, is that what you're --

CAIN: Well, Wolf, let's see what the story is going to be. I don't want to get into, you know, being pinned down on some things until we see what the story is going to be.

BLITZER: Because -- but they basically gave you the outlines, this Atlanta television station --

CAIN: They gave my attorney the outline. And so I'm now speaking secondhand in terms of what I know about the story. When we know the story, we will respond.

BLITZER: So basically, from what I hear you saying and what this Atlanta TV station has been teasing for the past hour or so, is that a woman is going to come forward and say she had an affair -- and affair with you.

CAIN: This is the understanding that we have, through my attorney, about what's going to be said.

BLITZER: What a -- what -- without giving us her name, tell what was she like?

I mean tell us a little bit -- something about this woman --

CAIN: No.

BLITZER: -- the nature of the friendship.

CAIN: No, I'm not going to do that, Wolf. It would be premature.

BLITZER: Did you work with her?

CAIN: No. Wolf, that would be premature because just like I'm concerned about someone slandering my reputation and image, until I know exactly what the claims are, I'm not going comment on those claims, unfortunately. BLITZER: So but this -- as you understand it, the two women who accused you of sexual harassment. Now a third woman potentially coming out and saying she had an affair with you --

CAIN: And remember that the first two were baseless. They were false accusations. They were not able to prove it. And I went before the media and the public and said here's what I know, here are the facts. And people will have to make that judgment as to whether or not they believe me or believe them.

The same is true of the one that is supposed to be reported on later today.

BLITZER: Because this is a woman you never worked with. The other two you did work with.

CAIN: No. One of the other ones I worked with. The second one that came out, I don't recall ever working with.

BLITZER: The one from Chicago, you mean?

CAIN: The one from Chicago, I recall -- the one from Chicago, I never remembered who she was, her name or working with her. The one at the National Restaurant Association, I do remember working with her.

BLITZER: Why would this woman in Atlanta be coming out right now and making these charges, these accusations?

CAIN: I can only conjecture and I'm not going to do that, Wolf, until we know what it is I'm being accused of.

BLITZER: Well, obviously, she's going to say she had an affair with you --

CAIN: Probably.

BLITZER: -- and we'll see what else, if anything else, she says.

CAIN: Right.

BLITZER: So we'll watch it unfold.

Are you worried this could further hurt you in this Republican race for the White House?

CAIN: I'm more worried that this is going to hurt my wife and my family, because it's going to be proved that it was probably something else that was baseless. And the court of public opinion does not consider that when they want to pass that judgment.

I can take the lumps. I expected this kind of stuff when I made the decision to run for the president of the United States of America. But the thing that I'm worried about is the impact it's going to have on my wife and my family, because they should not be subjected to false accusations that cannot be proved.

BLITZER: Have you spoken to your wife and family about this?

CAIN: Yes, I have. I have spoken to my wife.

BLITZER: How did -- how did they react?

CAIN: My wife's reaction was very similar to mine. Here we go again. And when I told her what little information that I knew about it, her response was the same as mine. And that was, here we go again. We will basically show, when the details become available, that I didn't do anything wrong.

BLITZER: Do you expect other women to be coming out and making similar kinds of accusations?

CAIN: I don't --

BLITZER: Is there any evidence --

CAIN: None --

BLITZER: Is there any indication that --

CAIN: Not --

BLITZER: -- that there are some others out there?

CAIN: None that I know of. I mean, think about it, Wolf. You go through life and you believe that you have some people that are friends. And when someone that appears to be a friend turns around and concocts this story, you've got to question, the hundreds of thousands of people that I have met in my life?

A hundred thousand people could possibly come out.

Do I know of any that might come out?

Not off the top of my head. But you have to look at my entire life and wonder, it's probably an infinite number of people who could come forward with a story.

So I can't possibly say that somebody else might not come up with it. But so far, they've all been found baseless.

BLITZER: Does your wife know this woman in Georgia?

CAIN: No.

BLITZER: Nobody in your family knows this woman?

CAIN: No.

BLITZER: How long did you know her as a friend?

CAIN: I won't get into that, Wolf, because it's all premature.

BLITZER: But you're staying in this race? You're not dropping out?

CAIN: I'm not dropping out of this race, no. As long as my wife is behind me, and as long as my wife believes that I should stay in this race, I'm staying in this race, because I am sick and tired of the hurt and harm that somebody out there is doing to my family, more so to me, with these baseless -- these baseless charges.

See, what this says is, is that somebody is awfully afraid that I'm doing too well in this Republican nomination to continue to dig up these stories to try and put a cloud and a damper on my campaign. We are going to stay focused on this campaign.

BLITZER: Is there a racial element, do you believe, because none of the other candidates have had these kinds of sexual harassment or affair relationships emerging in the last few months.

CAIN: The --

BLITZER: Is there something else, in your mind, that's going on here, targeting Herman Cain?

CAIN: There could be. But I can't say for certain. And I haven't spent a lot of time trying to analyze whether or not it was some put --- something that is racially motivated.

I want to stay focused on this campaign, our trifecta -- fixing this economy, the national strategy that I'm going to roll out tomorrow at the Hillsdale College. And then in a week or so, we have a dynamite energy independence strategy that worker going to be rolling out.

This is what we've been focusing on, which is why I want to continue to focus on that, which is why any details that come out we're going to handle them through my attorney, Lin Wood.

BLITZER: And all -- and throughout all this, these weeks now that these sexual harassment allegations and now this new allegation, have you ever said to yourself, you know what, it's not worth it, it's not worth running for the Republican presidential nomination, maybe I should drop out?

CAIN: What I have said is, why?

And I come back to, it's for the grandkids. That's number one.

BLITZER: What's for the grandkids.

CAIN: Running for president.

BLITZER: For your grandkids?

CAIN: My grand -- all the grandkids. That's why I'm doing this, for the grandkids. So that's the number one -- when I -- have said, why am I putting myself through this?

The answer is for my grandkids and all of the other grandkids out there, to leave them a nation as good as or better than the one that we were able to pursue our opportunities.

But then the second reason that I continue to hang in there is because if I drop out because of this kind of mess, as my grandmother would call it, then the system wins. And one of the reasons I'm running is to change the system. And this is one of the aspects of it. It's just the way it is, but I'm not going to allow this sort of thing to cause me to drop out simply because it's tough on me.

I don't want it to be tough on my family. And there comes a point that if it's tough on my family, I have to consider that at that particular point in time.

BLITZER: And you would drop out if it got overwhelmingly tough?

CAIN: I would -- I'll make that decision depending upon the circumstances and how it is impacting my wife and my family. That's my number one concern by all of these accusations.

BLITZER: I've got other questions I want to ask you.

I want to take a quick break.

CAIN: Yes.

BLITZER: But just to recap right now, we're bracing -- we're getting ready and you -- I'll put it in your words, for what?

CAIN: Another accusation that I had an affair with someone, another woman.

BLITZER: Stand by.

We'll continue this conversation.

CAIN: OK.

BLITZER: More with Herman Cain here in THE SITUATION ROOM, right after this.

(COMMERCIAL BREAK)

BLITZER: We're back with the breaking news, Herman Cain.

Mr. Cain, as you know, we've been talking about this woman who is about to go forward, according to a television station in Atlanta, and say she had, in the -- in the words of this television station in Atlanta, a 13 year affair with you. A 13 year affair with you.

And you've been told by this television station that this is coming. You've -- you've been discussing it with your lawyer, Lin Wood.

CAIN: Yes.

BLITZER: -- in Atlanta. You're going to issue a formal statement after you hear specifically what she has to say.

But did you have a 13 year affair with this woman?

CAIN: No, I did not.

BLITZER: Did you know her for 13 years?

CAIN: Yes. But I did not have an affair, OK. And until I see and hear exactly what's going to be -- what the accusations are going to be made, let's move on. But I acknowledge that I knew the woman. I acknowledge that I've known her for about that period of time. But the accusation that I had a 13 year affair with her, no.

BLITZER: Do you suspect she has any evidence -- e-mails, letters, gifts, anything that she will be able to bring to try to confirm this?

CAIN: Wolf, no. That's --

BLITZER: So --

CAIN: I don't -- Wolf, when you've done nothing wrong, no. I mean if -- just like the second woman a few weeks ago came in with this statement and these so-called documents which could not stand up to -- to scrutiny, I have no idea what it is that she's going to have to show proof. So I -- until -- we can't respond to what we don't know. We can't respond to what we don't know.

BLITZER: All right. I want to move on to some other issues.

CAIN: OK.

BLITZER: But you understand that this explosive allegation that is about to be made by this woman --

CAIN: I understand.

BLITZER: -- claiming a 13 year affair with you, that that's going to certainly dominate the news cycle --

CAIN: Sure it is.

BLITZER: -- as far as you're concerned.

CAIN: And, Wolf, this is why, since I was going to be on your show to talk about my campaign, I wanted to get out in front of it. Because I have nothing to hide. I have done nothing wrong, just like it was demonstrated for the first two times around.

BLITZER: Let's talk briefly about some other issues. Newt Gingrich says he is more conservative than Mitt Romney. Are you more conservative than Newt Gingrich?

CAIN: If you define more conservative, I can respond to it. Because here's the problem when you talk about who's more conservative, which issue are you talking about? Because just to say more conservative, what are we talking about?

Are we talking about life? Are we talking about second amendment? Are we talking about, you know, the constitution? So saying yes or no is a very never less question to answer because there are so many aspects of what a lot of people consider conservative.

Let me give you my definition. My definition of conservative is someone who strongly believes in less government, less taxes and more individual responsibility. That's my definition of conservative.

BLITZER: But under that definition, how would you define yourself compared to Mitt Romney and Newt Gingrich?

CAIN: Relative to those three criteria, I believe that Speaker Gingrich and I are probably both equal in terms of how we feel about less government, less taxes and more individual responsibility.

I have heard Governor Romney say exactly the same thing. But when you start to get into some other specific issues in testimony of what is considered conservative or not conservative, I don't think you can consistently say yes or no.

But on those three, I happen to think that all three of us are equally conservative.

BLITZER: Correct me if you're wrong, you like Newt Gingrich a lot more than Mitt Romney.

CAIN: I respect both of those gentlemen -- I respect both of those gentlemen for what they do for different reasons. I respect Newt a lot because of the vast amount of experience that he brings.

I respect Governor Romney for the experience that he brings and the fact that he has a business background. So I have nothing but the highest level of respect for both of them.

BLITZER: I watched your new 5-minute video on 9-9-9.

CAIN: The movie.

BLITZER: The movie as you're calling it that came out. It explains what have you in mind. You know that a lot of your Republican counterparts, your challengers for the nomination, they say you are creating this new stream of revenue for the government by having a national sales tax at 9 percent.

But say in Europe it started low and went up to 20 percent. It could wined up being 20 percent here. How do you respond, that once you create a stream of revenue for the federal government that will only go away and only go up.

CAIN: It is really very simple. Tax structures don't raise taxes, politicians do. The reason that Europe ended up with the system it has is because of hidden taxes. In our 82,000 page tax code, we are hit with sneak taxes all the time. The difference is under 9-9-9 plan, you know what the tax is. It is 9 percent visible.

BLITZER: But Congress could raise it. CAIN: They could raise it just like they could raise them now. They've got thousands of ways in the current tax code that they could raise taxes and we not know about it until we have been bitten.

At least with 9-9-9, you know what it is. It's the lowest possible rate in order to generate the same amount of revenue and it is visible. So the American people will hold Congress' feet to the fire because they will know what it is if they try to raise it.

BLITZER: I want to read to you what former President Bill Clinton told Nick Christoph, the columnist from the "New York Times". He said the Republican nominee would have to deal with, quote, "a political environment in the Republican primary that basically means you can't be authentic unless you've got a single digit IQ. He was really blasting.

CAIN: That's kind of a smack, right?

BLITZER: Yes. Although he did say in a separate interview with News Max that Newt Gingrich, he liked what Newt Gingrich had to say about illegal immigration.

CAIN: Well, here's what the people are saying. The people are going to have the last word and the people are responding to me in particular, to the fact that I have concrete solutions that I'm putting on table.

That are considered bold and even though I have not held public office, they don't care. So President Clinton's comments I don't want to respond to, but I just know that American people will have the last word.

The voters are going to have the last word. Now I know I have fallen in polls, but I didn't fall all the way to the bottom. We are in third place. You know --

BLITZER: Of the national polls.

CAIN: On the national polls, depending on which one you look at, but if you lock at the ones like clear view politics, I'm still in third place.

BLITZER: You are fighting with Ron Paul.

CAIN: Exactly, but here is my point. My point is I didn't fall all the way to the bottom. Did some people believe the Herman Cain train simply because of the accusations? Probably.

BLITZER: The sexual allegations.

CAIN: Yes, but most people didn't. Secondly, the other point is, when I talk about how to fix the economy, 9-9-9, what about my national security strategy, which is peace through strength and clarity.

Remember we talked about this earlier. We don't have a lot of clarity because it wasn't real clear what the relationship is ought to be in the future and then thirdly energy independence. We are too dependent upon foreign oil.

We have the resources right here in the United States of America to become energy independent. In a couple of weeks, we are going to present that very bold plan for how we achieve energy independence. You want to know how many years we can do it?

BLITZER: Yes.

CAIN: Nine.

BLITZER: Nine years?

CAIN: Nine years.

BLITZER: You love that number nine. You know, what also you and you know this was that the editorial board meeting in Milwaukee.

CAIN: Yes, it did.

BLITZER: You know, we got the video from the "Milwaukee Journal Sentinel" and we played it on the air and have you a long pause about Libya and you seemed to be confused about U.S. policy toward Libya.

Professor Fouad Ajami, of the Hoover Institution, he's a Middle East scholar. He was on our show. We played that clip and I asked him what he thought.

This hurt you more maybe more than the sexual harassment allegation, but I want to you to qualify here what's going on here. Listen to what Professor Ahjami said here in THE SITUATION ROOM.

(BEGIN VIDEO CLIP)

FOUAD AJAMI, HOOVER INSTITUTE: I think it is a disgraceful moment. I think the flight from the world, if you will, is just a problem in our country. The idea that someone is running for president and so unprepared and in fact, he tried to make a virtue out of his ignorance a while back, he said he doesn't care and he doesn't know the name of (inaudible) so he glorified ignorance.

(END VIDEO CLIP)

CAIN: Well, first of all, I did not glorify ignorance. Was it embarrassing? Yes. Was I caught off guard? Yes, because of a number of factors. That was a 40-minute interview and they pulled out 40 seconds to embarrass me and they did.

Yes, I was embarrassed by that, but that doesn't mean I didn't know the answer. What I was doing is gathering my thoughts so I wouldn't state anything incorrectly. No one said I didn't say something wrong.

They just question the pause and the fact that, yes, I was exhausted. I was probably too tired to do that particular editorial board that particular day and it ended up biting me. I ended up having a very embarrassing moment going all over the place. But I learned from it. I think the American people want a president who is willing to admit, yes it was embarrassing, but I learned from that. I will not put myself in that kind of position again knowing that something like that could happen.

BLITZER: So are you pacing yourself more doing less events?

CAIN: Yes.

BLITZER: Trying to make sure you don't get tired?

CAIN: Yes, exactly. And that was the problem. I had a very strenuous day. Not making excuses, but we should not have done it on the heels of everything that I had done. But, yes, I am pacing myself much, much better now to make sure that I don't be in a position where I'm going to be hit with a lot of rapid fire questions. Like in you show and then not be ready for it.

BLITZER: You were ready today obviously. Let me just button up the interview because we are all out of the time.

CAIN: Yes.

BLITZER: You are facing explosive accusation coming from Atlanta from a woman who is about to tell a television station in Atlanta, George. She had a 13-year affair with you. This is going to cause a lot of grief, a lot of angst if you will in your campaign among your supporters.

CAIN: I know it is, but there is nothing I can do to control that if someone decided that they want to do something like this and make it public. All we can do is figure out how we're going to handle it.

Because of the previous false accusations, we will decide how to handle it and we will handle detail by detail accusation by accusation through my attorney Lynn Wood. We will address all accusations when we know what they are.

BLITZER: Have you discussed with Mr. Wood potential libel lawsuit against these women?

CAIN: We have not at this point, but we are not taking anything off of the table.

BLITZER: Herman Cain, kind of you to spend time with us. This is going to be an exciting night for you, I'm sure not the way you wanted, but I'm sure you will get ready for the questions that will unfold.

CAIN: When I go to this fundraiser that I'm permitted to go with supporters, I am going to have a nice steak dinner. When you've done nothing wrong, I'm going to continue my routine as normal as planned.

BLITZER: Good luck. I hope you enjoy the dinner. There are a lot of great steak places. I will give you some recommendations during the commercial break. We'll stay in touch. Appreciate it very much.

CAIN: Thanks, Wolf.

WOLF: Herman Cain, the Republican presidential candidate. So we've got a lot to digest. We'll bring in some of our political analysts assess what we just heard from Herman Cain.

The breaking news, another woman, a third woman is about to accuse him of having an fair, a 13-year affair. Much more coming up right here in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: You saw breaking news unfolding here in THE SITUATION ROOM. Herman Cain, the Republican presidential candidate, reacting to what are about to be new and very, very explosive charges from a woman in Atlanta, Georgia, accusing him of having a 13-ier affair with her.

Let's assess what we just heard. Gloria Borger is here. Joe Johns is here. Erin Burnett is here. Gloria, first to you. This is obviously the third woman that's about to make accusations, not of sexual harassment, but of having an affair.

GLORIA BORGER, CNN CHIEF POLITICAL ANALYST: Right and he denied to you quite explicitly, Wolf, that this was an affair. He said it was a relationship that was a friendship, not sexual in nature. So we are going to have to hear what this woman says.

The other women who have come forward said that they had worked with Herman Cain at the National Restaurant Association and claimed sexual harassment. This seems to be a very different kind of allegation.

But again, Wolf, the weight of these kind of allegations, coming out over and over again, he seemed to indicate that there were people who opposed his political campaign and may be behind it, but he wasn't very specific as he was a couple of weeks ago.

BLITZER: Erin Burnett, you saw the interview unfold here in THE SITUATION ROOM. What was going through your mind as you hear his accusations and response?

ERIN BURNETT, HOST, CNN'S "OUTFRONT": I thought it was interesting how he said, look, I'm going on the Wolf Blitzer show, so I will take the opportunity to get out in front of this and start contrast obviously how he'd how he handle it before.

But I thought it was interesting, Wolf, when you pressured him on is it possible that she would have some sort of evidence, whether that be e-mail or anything else. That was where him being so adamant really stuck with me.

Because if something like this would be true, you would think there would be that sort of proof unless the 13-year period was back in the 80s was before we had e-mail. So it was interesting that he was adamant on that particular line of questioning that you had and that really stuck with me as something that gave it more credence.

BLITZER: I think you're right. Joe, you know, I assume this Atlanta television station would not go on the air based on what one woman says without some back-up information, some corroboration.

JOHNS: Well, you would think so. They already have a Facebook page up sort of promoting all of this. I checked that out a little bit.

BLITZER: What did it say?

JOHNS: Just an indication that we are going on the air with explosive new allegations relating to Herman Cain. For his part, he did about all can do, which is what PR people tell you, try to get in front of it.

At the end of the day, the question will be how is it playing and checking social media sites for example? Tony Frado, the former White House aide under President Bush say, also a key Republican saying this won't work out for Herman Cain.

BLITZER: We'll see. Stand by. There is a lot to digest. We're following breaking news. The explosive new sexual allegations against Republican presidential hopeful Herman Cain.