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The Situation Room

Holiday Fires; Donald Sterling Selling Team?; Former V.A. Secretary on Department's Problems; Putin Blames U.S. for Deadly Clashes in Ukraine

Aired May 23, 2014 - 18:00   ET

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

WOLF BLITZER, CNN ANCHOR: And holiday danger. An out-of-control fire tears through thousands of acres of a popular tourist destination, as the Memorial Day weekend begins.

We want to welcome our viewers in the United States and around the world. I'm Wolf Blitzer. You're in THE SITUATION ROOM.

ANNOUNCER: This is CNN breaking news.

Right now, Donald Sterling appears to be giving the NBA what it wants. More than three weeks after he was banned for life from the league for making racist remarks. CNN has learned Sterling and his wife, Shelly, have agreed to sell the L.A. Clippers before an expected vote to terminate their ownership. We're also told Mrs. Sterling now calling the shots in secret negotiations under way with the NBA.

Our panel is standing by. There's a lot of information to digest, including new details on how and why this scandal exploded in the first place.

But let's get the latest from our national correspondent, Suzanne Malveaux -- Suzanne.

SUZANNE MALVEAUX, CNN NATIONAL CORRESPONDENT: Well, CNN has learned that Donald Sterling has turned over controlling ownership of the Clippers to his wife of 58 years, Shelly, in hopes of selling this team.

Now, after threatening to sue the NBA, he is now using another tactic to play hardball with the NBA that if successful could mean a half-a-billion dollars in profit and a speedy resolution.

(BEGIN VIDEOTAPE)

MALVEAUX (voice-over): The ball is now in Shelly Sterling's court. Now that her husband and longtime business partner, Donald Sterling, has handed over his control of the L.A. Clippers, Shelly Sterling is now negotiating with the NBA to possibly sell the team.

SUNNY HOSTIN, CNN LEGAL ANALYST: The NBA made it clear this was all about Donald Sterling. They weren't penalizing Shelly Sterling, and so in a sense, this is really a game of legal chess.

MALVEAUX: Why? With the NBA draft fast approaching in June, a quick resolution would benefit the team and the league. Tuesday, NBA commissioner Adam Silver seemed to offer a way out for Donald Sterling. Sell the team now and Sterling would avoid the special hearing early next month requiring him to face charges that he damaged the league and the vote by NBA owners potentially forcing him to sell.

ADAM SILVER, NBA COMMISSIONER: I prefer he sell it than we go through this process. So if that's what you mean by man to man, I'm open to that.

MALVEAUX: A move toward selling the team is an about-face for all sides, from Donald Sterling who through his attorney refused to pay the fine or sell the team, threatening to sue the league.

DONALD STERLING, OWNER, LOS ANGELES CLIPPERS: Money is not what I'm interested in.

ANDERSON COOPER, CNN ANCHOR: So why not walk away?

D. STERLING: I want to show all the people that are associated with basketball and the world I'm not a racist.

MALVEAUX: And Shelly Sterling, who throughout the firestorm professed love for the team.

SHELLY STERLING, WIFE OF DONALD STERLING: I talked to some of the players. They hugged me.

MALVEAUX: While swearing she'd hold on to her 50 percent.

S. STERLING: I think half the team is mine, and I will fight for it.

(END VIDEOTAPE)

MALVEAUX: NBA spokesman Mike Bass now is responding to the reports about Donald Sterling surrendering controlling ownership of the Clippers.

He states here, he says: "We continue to follow the process set forth in the NBA constitution regarding termination of the current ownership interests in the Los Angeles Clippers and are proceeding toward a hearing on this matter on June 3.

So, Wolf, what we're looking at here is potentially bare-knuckle negotiations until June 3 and we will see how it unfolds.

BLITZER: Not many days left.

MALVEAUX: No, not at all.

BLITZER: Let's see how it all unfolds. Suzanne, don't go away. I want you to be part of this conversation.

Also joining us, CNN commentator L.Z. Granderson, CNN anchor Don Lemon, and James Rainey from "The Los Angeles Times," who has broken details in the story. What are your sources telling you, James, first of all, about Shelly Sterling, her intention to try potentially to maintain at least some ownership in the team? What's the latest you're hearing?

JAMES RAINEY, "THE LOS ANGELES TIMES": Well, I am hearing the same thing I think you are, that she would like to maintain an ownership interest, perhaps to make an immediate sale, but the thing everyone here has to remember, and maybe you have already spoken about this, is that there can be no transfer from Donald Sterling to Shelly Sterling without the approval of the NBA owners.

So if the other 29 owners don't approve this, it's as if it didn't happen. Donald can do whatever he thinks he's doing with the transfer, but it's as if it doesn't exist. So, it could be much adieu about nothing. I don't really know if this is going to be a hiccup in the long-term sort of transformation here of ownership of the Clippers.

BLITZER: Well, clearly, what the NBA is hoping, to avoid any legal battles and maybe even avoiding a vote on June 3 by the 29 other owners, James, is just let these two individuals, the Sterlings, agree to sell the team. Is that possible, is that likely?

RAINEY: Well, and that might be one good people to ask the people in Shelly Sterling's camp. They haven't gotten back to us yet. But why do we need a transfer to Shelly Sterling if the intent here is to sell the team?

If the intent is to sell the team, Donald is the controlling owner right now. He's the one who is most important to the NBA. He can go ahead and sell the team and tell -- he can inform the commissioner, I'm moving ahead with the sale, and that perhaps would mollify the NBA. Maybe they would call off the hearing.

So, why it would make a difference? Now, in terms of the legal gambit by the Sterlings to put the team in the hands of an individual who is not facing at least directly the charges that have been levied and that we at "The Times" have taken a look at, that could put them in a stronger legal position.

But in terms of really wanting to sell the move and -- sell the team and move ahead expeditiously, it's unclear that that's really what this is about.

BLITZER: Don Lemon, everything I'm hearing is the NBA doesn't want, certainly doesn't want Donald Sterling to have any role, but they don't want Shelly Sterling to have a significant, if any role at all. I assume you're hearing the same thing.

DON LEMON, CNN ANCHOR: Yes. They don't want any significant role. And I'm glad James said that, because I'm skeptical about this, too, about transferring, whatever it is, negotiating, ownership, whatever they want to do.

And as I have said to you on this program, Wolf, I'm very skeptical about that. I don't really see the reason or understand it, except if there's some backhanded legal maneuver that they're trying to do. But the NBA has made it perfectly clear, the players have made it perfectly clear, the public at large perfectly clear that they don't want any of the Sterlings having anything to do with the L.A. Clippers.

BLITZER: L.Z., you think the Sterlings have blinked?

L.Z. GRANDERSON, CNN CONTRIBUTOR: No. I think they're maneuvering.

LEMON: Right.

GRANDERSON: The only reason why I would think they would blink is that -- and we haven't seen the entire document that the NBA has compiled through its investigation.

So we don't know how much hard-core evidence they have in terms of charges against Shelly Sterling and being racist, either directly tied to the housing discrimination lawsuits or within the organization itself. We know in "The L.A. Times" story that there have been employees who have said that they don't want Shelly Sterling involved either, that she's a horrible individual as well.

So, I don't know how much ammunition they may have in their investigative reporting to help push Shelly along, but on the outside looking in, it just looks like a shell game to me.

BLITZER: Suzanne, the timeline, it is pretty specific. The Sterlings have to respond to the legal brief submitted by the NBA by May 27. Then all of the owners are scheduled to meet June 3 in New York. If three-fourths of them vote to terminate the Sterlings' ownership of the Clippers, it's over for them.

MALVEAUX: And the NBA has made it clear that they want to move forward, that that's going to happen no matter what kind of deal there is between the Sterlings.

But what I think is really interesting is the fact we heard from Mark Cuban yesterday, from the Dallas Mavericks, the owner of that team, saying the most -- the thing that he was most worried about is being a hypocrite here, because he said, look, you know, I have had bigoted thoughts as well, I cannot throw stones when I live in a glass house.

I think this is a way for the owners to get out of this. I wouldn't be surprised if Donald Sterling put this out there to give a little bit of breathing room for the owners, and say, look, you know what? There's an escape hatch for you too. You don't have to make this decision, because there are probably owners who are pretty scared, pretty worried about their own potential behavior being a problem in owning their own team and losing their teams.

BLITZER: James Rainey, you and your colleagues over at "The L.A. Times," you have done some pretty significant reporting on going back on how this whole story exploded weeks ago and the relationship that clearly had deteriorated between Donald Sterling and then-girlfriend V. Stiviano.

Just give us a couple of those headlines that you have uncovered.

RAINEY: Well, so 16 days before this whole thing blew up on TMZ, we now know that there was a copy of the audio sent by V. Stiviano to some employee of the Clippers. We don't know which employee.

And right before sending that, she sent a text to this employee saying, "Let the games began." We think she meant let the games begin. And this was after being told by this Clippers employee that she was out for that night. This is one of the last regular season games. It was against the Oklahoma City Thunder, big game. She was used to being there courtside or in a suite with her friends and kind of living large.

She'd just been given some bad news and she said, look, I'm coming to the game anyway. I have got my own tickets. And then she sent this very provocative message of, "Let the games began," which I think should become the new NBA slogan, incidentally. I would like a trademark fee on that.

But she launches this very provocative audio to this Clippers employee, who immediately passes it on to the president of the Clippers, who in turn gives it to Donald Sterling. And then we have the whole scenario where they don't tell the NBA, something that the NBA clearly thought was nefarious.

If you listen to Donald Sterling's people, they say, hey, private conversation between two adults. Why should we tell the NBA about this? We destroyed it. Maybe that's the best thing we could have done. We didn't know at that point it was going to go public and we just got rid of it.

BLITZER: Don Lemon, what do you make of all of that? Is this just a case of a woman jilted, then going public, and leveling these charges and making the audiotape available?

LEMON: Why would I think she's jilted? She's already said they didn't have a sexual relationship. She loved him like a dad. Come on, yes, of course, it's a jilted -- I'm being facetious here.

Of course, it's a jilted lover or something happened between the two of them that frayed their relationship. And, you know, I was just reading the text that was sent about needing tickets to the games, but, no, I got it from another regular, I don't really need him. Then let the games began or however she put it.

Yes, jilted lover who she claims is not her lover. And she was mad. She sent it to someone to get back at him and now here we go. We're on television talking about it and he's going to lose his team.

(CROSSTALK)

BLITZER: L.Z., go ahead.

GRANDERSON: She wasn't just mad. She wasn't just mad. There was also a lawsuit dangling out there that was threatening her as well. So it wasn't just a matter of...

(CROSSTALK)

BLITZER: A lawsuit by Shelly -- Shelly Sterling wanted to get some of that supposedly $2 million in houses and cars and jewels and clothes. She wanted a piece of that $2 million, suggesting it was -- half of it was hers, if you will, because of joint custody of all of that money with her husband.

(CROSSTALK)

RAINEY: Absolutely.

(CROSSTALK)

RAINEY: The thing is, Wolf, that she had just put a lien. Shelly Sterling -- six days before these provocative messages were sent to the Clippers, Shelly Sterling had put a lien on this $1.8 million home which would appear to up the ante, again, against V. Stiviano, who allegedly according to Donald Sterling told him, hey, you better get your wife to back off or words to that effect or there's going to be trouble.

Now, just her defense is, Ms. Stiviano, part of her defense is, I never knew that that lien -- I knew about the lawsuit, but I didn't know about this lien on my home just days before. People can take that for what it's worth. But clearly she sent the provocative message and she sent the audio.

She also -- just to remind the viewers, she denies sending the audio to TMZ. She says perhaps one of her friends who was holding on to it sent it to TMZ.

BLITZER: Give me a quick thought, L.Z.

GRANDERSON: Well, you know, I just keep going back to the NBA. And I have been really hard on commissioner Silver because I just feel this whole idea that they're moving swiftly negates the fact they have had information about this man for the past three decades.

But with that being said, I will applaud the fact they're staying on task. Again, I met with a top-ranking NBA official yesterday, and I was asking if they were going to say anything about Mark Cuban's comments. And he said, no, we're focused in on Sterling.

So I definitely applaud them. I don't think they should back off any of the pressure. They shouldn't fall for any of these shell games. They should stay on task.

BLITZER: You got any more bombshells, James?

(LAUGHTER)

RAINEY: Yes, we got some more good stuff to come. A couple of my colleagues are taking a look at the Sterlings and their history as landlords. And hopefully that will be in the paper in the next couple days. I think everybody -- we know everybody goes to latimes.com first anyway, and this is just another opportunity.

(LAUGHTER)

BLITZER: And we will be monitoring it.

(CROSSTALK)

LEMON: Let the games began.

RAINEY: Let the games began. New NBA slogan.

(CROSSTALK)

BLITZER: I suspect, Don, there will be a hashtag, #letthegamesbegan. I can see that coming up pretty soon.

All right, guys, thanks very much. Good conversation.

LEMON: Thanks, Wolf.

(CROSSTALK)

BLITZER: Other news we're following, a very serious story, a very serious story, a scary close call in the skies. We're now learning about the fourth near collision between two jets in recent weeks.

Our aviation correspondent, Rene Marsh, is over at Reagan National Airport here in Washington.

Rene, explain what you're learning.

RENE MARSH, CNN AVIATION CORRESPONDENT: Wolf, this shouldn't happen. But it did happen. We're talking about a passenger plane on the wrong path, and now we're learning it was an air traffic controller new to this position who put the plane on this path and this evening the FAA is investigating why it happened.

(BEGIN VIDEOTAPE)

MARSH (voice-over): An air traffic controller in training directs a United jet to turn, putting it on a possible collision with another plane departing Houston Bush Intercontinental Airport. Seconds later, according to the FAA, the controller realizes his mistake.

TOWER: United 601 stop your turn, stop your climb and stop your turn United 601.

MARSH: The two flights less than a mile away apart, setting off collision warning systems. Listen to stunned pilots second later.

PILOT: I had no idea what was going on in the tower but it was pretty gnarly looking.

PILOT: I'm guessing he was supposed to give us a left turn.

MARSH: Yet another high profile incident, putting a spotlight on something that actually happens every day -- in the skies over the Pacific, at New York's JFK and Newark.

UNIDENTIFIED MALE: He's real close.

MARSH: The rules of separation in the skies breached. The FAA's latest numbers show planes came too close nearly 4,400 times in one year, 41 of them deemed high-risk events.

PETER GOELZ, CNN AVIATION ANALYST: They are scary, they are unacceptable, they are worked on, but there's a backup system and people are safe.

MARSH: It's an air traffic system under stress, increasing air traffic and a potential shortage of controllers. Thousands more need to be hired and trained over the next seven years.

Some experts worry the agency's new hiring practices could make matters worse. The agency no longer gives preference to recent graduates from aviation colleges.

Just last month, a government auditor said he would study controller staffing levels and the impact of retirement. But incidents where planes get too close are not necessarily controller mistakes.

GOELZ: These mistakes can occur through a controller making an error, through a pilot making a mistake. But remember, there is avionics on board, particularly one called TCAS, which is collision avoidance assistance.

MARSH: The FAA says it has taken steps to prevent any similar occurrences in the future but they didn't say what those steps were.

(END VIDEOTAPE)

MARSH: Well, the FAA also telling us that an instructor was there at the moment of this incident ready to step in if necessary.

However, the FAA saying that this trainee was able to correct the problem immediately. We want to point out one other thing, Wolf. Ever since that technology, the collision avoidance technology has been placed in cockpits, we haven't seen any actual collisions, and, of course, that is a good thing -- Wolf.

BLITZER: That's a very good thing, indeed. Rene, thanks very much.

Let's bring in our aviation correspondent Richard Quest to talk a little bit more about these close calls in midair.

Is it getting close, Richard? Is it getting better? A lot more planes are flying all the time.

RICHARD QUEST, CNN CORRESPONDENT: Right.

And the interesting thing, of course, is whether or not it's actually getting worse or whether we're merely hearing more about them.

The numbers involved are extremely small. And that, of course, is deceptive. You're talking, if you look at the last data for 2012, 300,000th of 1 percent of flights had what we might describe as a near miss. The problem, of course, it's a very small number, but the consequences are so devastating.

If you also factor in things such as better reporting, amnesties for air traffic controllers who do report, an entire reporting structure that makes it more available to give out this sort of data, you start to see the complexity of understanding these very serious incidents.

And, ultimately, Wolf, what you're really looking for is not the one-off. You're looking for the systemic. You're looking for the thing that tells you something is wrong in the system, i.e., poor training, weak experience, bad management, pilots not understanding, lack of investment. Those are the systemic issues that ultimately you seek.

BLITZER: So should fliers -- especially on a Memorial Day weekend like we have here in the United States this weekend, how concerned should the flying public be?

QUEST: Not at all. Come back to that statistic I said; 300,000th of 1 percent would be the number. You're talking about 135 million takeoff and landings in 2012.

Of that, only 4,300 would be regarded near misses. Of that, a fraction, 40 of them, were what would be regarded as high-risk. Now, again, I keep coming back to this foible. The consequences are so serious that even one has to be taken very seriously, but if you look at the Newark incident, for example, where one plane went over the other on the runway, Newark has immediately instituted a new runway policy to prevent that happening.

I would expect in Houston, again, you would be looking at something to be instituted. You take the Kennedy example where one plane turned east while the other plane was turning at the same time in the opposite direction -- in the same direction. You're always looking to see why it happened and, crucially, was it a one-off? Did somebody make a mistake? Or is there something wrong in the system?

BLITZER: While I have you, a different subject, Richard. This Inmarsat satellite data that was supposed to be released this week, so far it hasn't been released. They haven't released all of the data of those so-called pings, those handshakes, why they're searching in the Southern Indian Ocean for Malaysia Airlines Flight 370.

Now, are they going to at least release a summary? What's going on?

QUEST: What is going on is, the information has now been sent from both Inmarsat and the Australians. I can tell you absolutely it has been sent to Malaysia. Malaysia are now compiling it into however they wish to put it in a digestible format.

But Inmarsat has already compiled the data, the important figures, and an explanation and a rationale and an understanding. When Malaysia will finally release it, well, that, we're waiting for, and we're pushing, as you can imagine, extremely hard. I was expecting it today. My guess would be now probably not the weekend. Monday or Tuesday. Any later than Tuesday, we will be certainly wanting to know why.

BLITZER: Richard Quest in London for us, thank you, as usual.

Still ahead, he died while waiting for care from Veterans Affairs. Now his daughter is accusing the VA of humiliating her father. The former veterans affairs secretary, Jim Nicholson, he is here in THE SITUATION ROOM. We will talk about the current VA scandal, who's to blame, and more.

And fire threatens a tourist hot spot, as a long holiday weekend begins. CNN is in the fire zone.

(COMMERCIAL BREAK)

BLITZER: We have some emotional new reaction from the daughter of a veteran who died while waiting for care from a VA facility.

President Obama's promising that widespread problems within the VA system will be fixed after CNN exposed some dangerous delays in treatment and allegations that records were falsified.

So far, the president has resisted calls for the resignation of the veterans affairs secretary, Eric Shinseki.

Our senior investigative correspondent, Drew Griffin, is joining us. He broke the story.

What is the latest, Drew? What are you learning?

DREW GRIFFIN, CNN INVESTIGATIVE CORRESPONDENT: Wolf, we just wanted to bring this into perspective about what the families are dealing with.

I talked with Priscella Valdez. Her father is a Vietnam vet, tried to get an appointment at the VA for 10 months after he developed shortness of breath, but he could never net in to see a doctor. When Priscella went to the hospital, herself, to try to get her dad that appointment, the soonest they had was three months out. They'd already waited 10 months.

Pedro Valdez died before he could make that appointment. He had acute respiratory failure. Wolf, he was just 66 years old. The inspector general's office has criminal investigators on the ground now at Phoenix VA looking into these allegations of secret waiting lists and as many as 40 deaths due to delays in care.

But last week, the head of that office told the Senate, so far, although they did find evidence veterans suffered harm because of delays in care, they couldn't attribute any deaths to the actual delays. Now, because of privacy laws, it's hard to know if Pedro Valdez was on anyone's list at the Phoenix VA, secret or not.

Priscella Valdez, though, only knows this. Her dad died before he was seen by a VA doctor.

(BEGIN VIDEO CLIP)

PRISCILLA VALDEZ, DAUGHTER: I asked several different people, how do I find out if my dad was on that list? But to me the list is just a piece of paper. I know, because of what I witnessed, because what I had seen my dad go through, so whether he was on that list or not, I know what he went through.

And he was a true victim of the delays, the refusal, the embarrassment that they put him through. They -- they took a man and broke him down and kicked him when he was down, when he needed them. And he willingly went through for fighting this war to defend his country, so that these people who are supposed to take care of him are able to live freely the way they do in this United States of America.

(END VIDEO CLIP)

GRIFFIN: Pedro Valdez died this past January 7.

Priscella tells me she had no idea at the time of his death that these allegations and secret wait lists and denied care were happening. Now, she says, looking back, Wolf, she believes she was living it and her father she believes died from it -- Wolf.

BLITZER: What a horrible story that is. How tragic that is. Stand by, Drew.

I want to bring in the former secretary of veterans affairs Jim Nicholson, along with CNN political commentator Ryan Lizza.

Mr. Secretary, you hear a story like that. And I know you worked there a few years. You were the secretary of veterans affairs. There was criticism at that time as well. What do you think? Shinseki, the current secretary, should he go?

JIM NICHOLSON, FORMER U.S. SECRETARY OF VETERANS AFFAIRS: I have known General Shinseki a long time. I know his wife. They're wonderful people, great Americans. They have served almost all their adult life serving our country.

I think it's premature to make that decision. There's a lot of investigating that needs to go on. What concerns me the most are the veterans. In just talking about this veteran Valdez, we need to focus right now on the veterans, because, if this has been going on, it means that some of these hospital centers are so crowded that they haven't been able to comply with their own standards. So we need to conduct some kind of an emergency action here, and I think the president of the United States has a discretion, certainly the responsibility, to move on this and say if you're not seeing these people and can't get them in within 12 days, send them to an outside health care provider.

BLITZER: What's delaying that? Because I have heard that now from several people, that the option is there to outsource them, if you will, send them to another local hospital, not a VA facility, if they need critical care.

NICHOLSON: I have no idea why they're not doing that.

(CROSSTALK)

BLITZER: Did you do that when you were secretary of veterans affairs?

NICHOLSON: Absolutely. That was a mandate.

And I think one of the reasons that they don't do it, there's sort of a perverse incentive at these medical centers that, if they do that, it comes out of their budget, and they all get compared to each other.

(CROSSTALK)

BLITZER: That sounds like a ridiculous bureaucratic reason...

NICHOLSON: I think it is.

BLITZER: ... when you're dealing with the lives of veterans, especially people who have served their country heroically.

NICHOLSON: Absolutely. I mean, we're sitting here Memorial Day weekend, and we ought to have this whole thing focused right now on the veterans.

The blame game, the responsibility, the politics, they'll play out because they always do. But we ought to have a laser focus right now on taking care of veterans that are still out there, that are not getting these appointments.

BLITZER: How much pressure, Ryan, is the president under right now to force General Shinseki, the secretary of veterans affairs, to step down?

RYAN LIZZA, CNN POLITICAL COMMENTATOR: I think he's under a little bit more now, because there's some Democrats that are involved now in calling for Shinseki to resign, and obviously, midterm politics is getting involved here. Democrats in tough races are making this an issue.

I think he's dealing with this quite similarly to how he dealt with HHS and Secretary Sebelius. He decided not to -- not to fire her, because the idea that there was -- you don't want to sack the captain while the boat's going down. You want them to be able to sort of fix it and stay on the job until it's repaired. And then, you know, frankly, push them out.

BLITZER: Let me ask Drew. Drew, nobody knows more about what's going on inside than you do right now. You've been all over this story for months and months and months. I know you've tried to interview Secretary Shinseki on many occasions. He's rejected all your requests.

Do folks inside the V.A. who are worried deeply about what's going on, do they believe, if he were gone tomorrow, it would change?

GRIFFIN: I don't think so. Many believe that Shinseki was kind of caught in the dark on all this. It's this kind of mid-level bureaucracy that runs these V.A.s all across the country. They all know each other. They all promote each other. And it's that kind of entrenched bureaucracy that the folks on the inside see as being the problem.

But to Mr. Nicholson's point, I just want to add to that, you know, we tend to talk about this in a political crisis, when out in the country, where the vets are, this is a medical crisis. All this talk about Shinseki resigning or who's to blame really doesn't matter to them. They want to know "Who's going to get my appointment and when can I see a doctor?" And right now, while this political crisis gets hashed out and the blame game gets hashed out, they're still waiting, Wolf.

BLITZER: There was an article recently -- I don't know if you saw it, Mr. Secretary. The "National Journal" wrote an article entitled "Who Really Broke Veterans Affairs?" They went back through the history, and they say this has been going on -- these delays, these bureaucratic nightmares -- forever, if you will, including while you were the secretary of veterans affairs. You must have been so frustrated, yourself.

NICHOLSON: Well, there are two different kinds of delays. There is a waiting list to get a disability rating.

BLITZER: There was a waiting list when you were there, as well.

NICHOLSON: Yes. Actually, when we came in, it was about 270 days. We got it shaved to about 160 days.

BLITZER: Which is still too long.

NICHOLSON: It's still too long. The standard is 125 days, but there's a real large number of veterans that are queuing up for disability.

BLITZER: Mr. Secretary...

NICHOLSON: I'll say that in my own defense, and I'll say that in defense of the current administration. There are more and more veterans showing up there. What the current problem is not for a disability rating. It's for medical care. LIZZA: Secretary, you're being very diplomatic. I remember when you resigned in 2007 then-Senator Barack Obama put out a very harsh statement. He said that Secretary Nicholson left the V.A. worse off than when he started, and it was one of the most tumultuous periods in V.A. history. What did you make of that statement? Was he being fair to you?

GRIFFIN: He was on the veterans affairs committee when he was a senator.

NICHOLSON: He was on the committee, but he never showed up. That was a political statement. And I, you know, expected somebody who was running for president would take a shot like that. And he would -- he would never come to the committee meetings so he really had no basis to know what was going on.

We did not have this current problem. In fact, we instituted and bought an electronic scheduling system. I think we called it Project Hero. And it was to facilitate these deployments, when a veteran would call in. And we were integrating it into the system. There are 153 hospitals spread around this country, and there's even a huge clinic in the Philippines in Manila. It was going relatively well, but it had some hiccups in it.

And when we handed off the transition, thinking we were going to be giving these books to Romney, we gave them instead to Obama. And it said this electronic scheduling system still has some wrinkles that need to be wired out.

LIZZA: Is it fair to say that neither administration has been able to fix this system?

BLITZER: The Bush administration and the Obama administration?

NICHOLSON: Let me finish the point. They took this whole system that we had, and for some reason they set it aside and went back to the old local laptop computer...

BLITZER: So is that Secretary Shinseki's mistake, do you think?

NICHOLSON: I don't know why they ever did that. Because we had spent about $120 million on it, and it was really starting to work.

BLITZER: But when you resigned, remind our viewers why you resigned. Because there was a lot of criticism. There was pressure on you, as well.

NICHOLSON: Well, there's no pressure on me to resign. I had no pressure. The big flap we had on my watch was we had somebody that took home a laptop and a hard drive that had the names of millions of veterans, and his house got broken into and somebody stole it. But soon as I found out about that and President Bush found out about that, we took decisive action that day, held a press conference, told every veteran in the world that this had happened and then hired companies to consult them. What's happening now is that the president of the United States is not talking responsibility for this. And what I think the root problem is with these hospital directors is, was that we've seen this kind of dishonesty and duplicity on the part of the president. "If you like your plan, you can keep it. If you like your doctor" -- so when they get -- when they get jammed out there -- and they're all compared to each other -- some of them, it appears, have succumbed, you know, to a weakness to create some kind of an offline system instead of being honest and transparent about it and saying, "I need help out here. I need reinforcements."

BLITZER: If there are people at the Department of Veterans Affairs who are lying and cheating and giving out false reports, you can't blame the president of the United States if there are some bad apples inside the system.

NICHOLSON: Well, I don't know. People look up to those above them, and if they see that happening, and...

BLITZER: Do they see Shinseki doing that?

NICHOLSON: Oh, no. I don't...

BLITZER: He's the secretary of veterans affairs.

NICHOLSON: I don't think he's doing anything about it.

BLITZER: He's the secretary of veterans affairs.

NICHOLSON: Well, he's responsible, but the ultimate person responsible for this, I think, is the commander in chief. He is the guy who ought to now be taking that kind of decisive action to see that we take care of these veterans out there who still -- there are maybe more of these Valdezes out there, because if they were jammed then and can't make the appointments in 12 days, they can't now.

BLITZER: Let me let Drew get into this conversation. Drew, you have a question for the secretary?

GRIFFIN: Well, I'm still -- I'm still hearing the political crisis instead of the real crisis.

But I wanted to ask Mr. Nicholson this question. It seems to me that, for a long time, no matter who was in power, we've had a lot of trouble bureaucratically running the V.A. When you were in, in that position, did anybody step back and say, "Why are we doing this? Why don't we let these vets use their vet card as more or less an insurance card and go out into the public sector and get the health care that we need? Why are we running a separate medical system just for veterans?"

NICHOLSON: Well, that question does come up. And that's -- that's a fair question, I think, but, you know, we've had a sacred trust with veterans in this country. It started with Abraham Lincoln who said we have to take care of him who fell and his widow and his orphan. We created this absolutely fabulous system. There's no country in the world that takes care of veterans like the United States.

But it's very big. We have 21 million veterans in our country, and we used to see about a million of them every week. And they are now seeing more, according to the statistics that I read. So it's -- it's a very big spread-out system, and you have people out there remotely at those hospitals, and they have to act responsibly and they have to act with integrity.

BLITZER: I want to remind our viewers you're not only a former secretary of veterans affair, not only a U.S. ambassador to the Vatican, but you're also a former chairman of the Republican National Committee. Right?

NICHOLSON: Yes, sir.

BLITZER: Just want to remind our viewers of that, as well. Thanks so much.

NICHOLSON: I'm also a graduate of West Point.

BLITZER: We salute you for that, especially on this Memorial Day weekend. Thanks very much for coming in.

NICHOLSON: A Vietnam vet. Yes.

BLITZER: A Vietnam vet. And you're very committed to the veterans. There's a lot of work all of us need to do right now. I want to make sure we don't get into too much politics right now, because there's a serious issue. Veterans' lives are on the line, as Drew Griffin has been reporting. We've got to do whatever we can to help those vets.

Secretary, thanks very much.

Ryan, thanks to you.

And Drew, of course, thanks to you, as well.

Just ahead, a massive fire running -- ruining, I should say, the Memorial Day weekend in one of the most beautiful parts of Arizona. We're live at the firefighters' command post.

Plus Vladimir Putin's latest challenge to the U.S. His brand-new finger-pointing on this, the bloodiest day so far in the Ukraine crisis.

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BLITZER: This just coming in to CNN. The Pentagon reporting small-scale pullbacks of Russian troops near the Ukrainian border. That still leaves tens of thousands of Russian troops, though, in place.

This weekend could bring a new flashpoint in the crisis as Ukrainians are voting for a new president. But today has been the deadliest day of the crisis. Let's go to our senior international correspondent, Nick Paton Walsh, who's on the ground for us with the very latest.

What is the latest, Nick?

NICK PATON WALSH, CNN SENIOR INTERNATIONAL CORRESPONDENT: Wolf, simply in the last 24 hours, three incidents. Yesterday 16 Ukrainian soldiers killed in an ambush. Today two separate incidents which killed well over 30 people, many of them pro-Russian militants.

People really looking at the violence for this coming weekend rather than the possibility for anyone to actually cast a vote.

(BEGIN VIDEOTAPE)

WALSH (voice-over): This is the sound of presidential elections in the separatist city, Slovyansk. They come here because it's so common.

(on camera): On that hill, we're told periodically the Ukrainian army fire heavy weapons artillery towards some of the militant checkpoints and barricades on the outskirts of this town and it's those explosions really that for weeks now have been the only presence people in this town have seen of the Kiev government.

(voice-over): If there were presidential elections at all here, they'd be run out of the building where the self-declared mayor now lives pledges to me that anyone who tries to stage a vote will be arrested. He shows me something remarkable in his backroom.

Strela surface-to-air missile launchers, he said, heat-seeking possibly operational got in lawless '90s, he says, now to fight Ukrainian jets.

"To get the little birds," he jokes.

He then trades something else, a Ukrainian journalist taken prisoner 30 days ago Irma Krat, he wants to exchange. She agreed to talk to us, said she was unharmed but terrified.

"All the time, you think the building will be bombed", she says, "and all the time people are waiting around for the siege of the building with Kalashnikovs, you're on your knees all night praying. That's how you live. The whole night you pray and during the day, you try to sleep."

As the separatists fight gets harder and they are digging in around Slaviansk, the separatists seem to be fracturing. Their leader in the main city of Donetsk, Denis Pushilin, isn't spoken well of here.

"From the start, I knew who he was", he says "a temporary figure, no political significance and a real power. I met him once and said hello and good-bye."

Falling out amongst themselves under siege, the Russia they wanted to join distancing itself but the government they oppose unable to assert control, isolated but still here. Now, across Ukraine, they'll vote on Sunday but many will not vote here. That probably is enough to make Moscow able to say these elections haven't been the legitimate chance for everyone in Ukraine to express their opinion. Whether or not, though, the disruption we're seeing by pro-Russian militants is enough for Washington to say that's reason to bring in sectoral sanctions, wider sanctions against parts of the Russian economy. We have to wait and see, Wolf. That's the key thing (INAUDIBLE).

BLITZER: Critical few hours coming up this weekend. Thank you.

Just ahead, the massive fire is ruining the Memorial Day weekend in one of the most beautiful parts of Arizona. We'll go there.

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BLITZER: Massive, out of control wildfires changing everyone's weekend plans in one of the most beautiful parts of northern Arizona. CNN's Ana Cabrera is on the scene for us. What's the latest there?

ANA CABRERA, CNN CORRESPONDENT: Well, you can see the fire still burning very strong based on all the smoke and the haze in the air behind me. We had a chance to go into the fire zone to get a better look at some of the firefighting in action today. As this fire has charred now 7,500 acres and is just 5 percent contained.

And one of the reasons it's been so challenging for firefighters to get this fire under control is because the very steep and rocky, rugged terrain as this fire burns through some very heavy and dry fuel, a combination of ponderosa pines, pine needles. So, they're having to use a lot of the air support, helicopters making huge dumps of water, fire retardant, and they're focusing their fire lines on the burnout operation.

So basically, controlled burns where they're able to sort of get ahead of the fire, put fires there, get the fuel out of the way. And that's going to be the key as this firefight continues, Wolf.

BLITZER: Ana Cabrera, thanks very much.

Just ahead, incredible pictures of a mountain climber's escape from death.

But first, this "Impact Your World".

(BEGIN VIDEOTAPE)

CHRIS CUOMO, CNN CORRESPONDENT (voice-over): He has photographed presidents, heads of state and celebrities, but Marco Grob's passion lies with a different subject matter, landmine victims.

MARCO GROB, PHOTOGRAPHER: Landmines you find pretty much everywhere where a conflict ends there is not much I can do as a photographer, really. But the one thingy do is give those people affected a face and a name. CUOMO: Grob travels to mine areas to photograph victims helping to raise awareness, alongside the United Nations Mine Action Service, or UNMAS.

GROB: Especially young boys, unfortunately, are often falling victim to especially cost ammunition which still looked like toys. Then there is the aspect and unexploded ordnance, piles of ammunition.

What is in Afghanistan right now could show up at some sunny afternoon at Times Square. Unthinkable.

(EXPLOSION)

CUOMO: Grob wants the portraits to speak for those with the fear of landmines every day.

GROB: I would like people look at these stories and think of how even when we have our to deal with our daily problems, at least we don't have to be scared to take a step.

(END VIDEOTAPE)

(COMMERCIAL BREAK)

BLITZER: A mountain climber's research expedition turned into a life or death struggle. On Monday in the Himalayas, Professor John All fell into a crevasse, a massive crack in a mountain ice sheet. He was injured and bleeding. The only way out was a climb of about seven stories. After some five hours of struggle, not only did he make it, he brought this incredible video with him. I'll be speaking with him later tonight 8:00 p.m. Eastern when I fill in for Anderson Cooper.

Also I want to remind you about a special show coming up soon on CNN, a new series from executive producers Tom Hanks and Gary Goetzman, "the Sixties." Be sure to watch. Set your DVR for the premier next Thursday night, 9:00 Eastern and Pacific, only here on CNN.

That's it for me. See you in one hour.

"ERIN BURNETT OUTFRONT" starts right now.