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State of the Union

Interview With California Senator Dianne Feinstein; Interview With U.S. Secretary of State John Kerry; Interview With Texas Congressman Michael McCaul; Interview With Israeli Prime Minister Benjamin Netanyahu

Aired July 20, 2014 - 09:00   ET

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

CANDY CROWLEY, CNN ANCHOR: As international teams try to recover the dead and protect the evidence, personal tragedy and global consequences unfold on the ground in a war zone: the downing of Malaysia Airline Flight 17.

(BEGIN VIDEOTAPE)

CROWLEY (voice-over): Today: the U.S. secretary of state.

JOHN KERRY, U.S. SECRETARY OF STATE: We know for certain that the separatists have a proficiency that they have gained by training from Russians.

CROWLEY: John Kerry with the latest intelligence information, and whether he trusts anything Vladimir Putin has to say.

And:

SAMANTHA POWER, U.S. AMBASSADOR TO THE UNITED NATIONS: This war can be ended. Russia can end this war. Russia must end this war.

CROWLEY: Analyzing the chilliest U.S.-Russian relationship since the Cold War and Israel's fiercest assault on Hamas in decades. The chairmen of two key Capitol Hill committees, Dianne Feinstein and Mike McCaul join us.

And as Israel expands its ground offensive, an interview with Prime Minister Benjamin Netanyahu -- on the ground in Gaza, our conversation with the U.N. relief worker on trying to shelter the innocent amidst war.

This is STATE OF THE UNION.

(END VIDEOTAPE)

CROWLEY: Good morning from Washington. I'm Candy Crowley.

On the ground in Eastern Ukraine, international observers say 196 bodies have been found, recovered, and loaded onto trains.

(BEGIN VIDEOTAPE)

CROWLEY: Joining me now, Secretary of State John Kerry. Mr. Secretary, it's good to see you.

Let me start off with whether you know anything new about the downing of this Malaysian airliner from intelligence information. What do we know now for certain?

KERRY: Well, we know for certain a lot more, Candy.

We know for certain that, in the last month, there's been a major flow of arms and weapons. There was a convoy several weeks ago, about 150 vehicles with armed personnel carrier, multiple rocket launchers, tanks, artillery, all of which crossed over from Russia into the eastern part of Ukraine, and was turned over to the separatists.

We know for certain that the separatists have a proficiency that they have gained by training from Russians as to how to use these sophisticated SA-11 systems. We know they have the system. We know that they had this system to a certainty on Monday the 14th beforehand, because the social media was reporting it and tracking it.

And on Thursday of the event, we know that, within hours of this event, this particular system passed through two towns right in the vicinity of the shoot-down. We know, because we observed it by imagery, that, at the moment of the shoot-down, we detected a launch from that area, and our trajectory shows that it went to the aircraft.

We also know to a certainty that the social media immediately afterwards saw reports of separatists bragging about knocking down a plane. And then the so-called defense minister, self-appointed, of the People's Republic of Donetsk, Igor Strelkov, posted a social media report that -- bragging about the shoot-down of a transport plane, at which point, when it became clear it was civilian, they pulled down that particular report.

We know from intercepts, voices which have been correlated to intercepts that we have, that those are, in fact, the voices of separatists talking about the shoot-down of the plane. They have shot down some 12 planes, aircraft, in the last months or so, two of which were major transport planes.

And now we have a video showing the -- a launcher moving back through a particular area there out into Russia with a missing -- at least one missing missile on it.

So we have enormous sort of input about this which points fingers. And now we have these horrendous...

CROWLEY: At who, Mr. Secretary? At who?

KERRY: Well, it basically -- it basically -- it's pretty clear that this is a system that was transferred from Russia in the hands of separatists.

We know with confidence, with confidence, that the Ukrainians did not have such a system anywhere near the vicinity at that point in time. So it obviously points a very clear finger at the separatists. And that's why President Obama and the international community are demanding a full-fledged investigation, which Russia said they would do.

So...

CROWLEY: Mr. Secretary, do you believe that Russia is culpable for the downing of this commercial jetliner, if they gave these separatists the equipment, whether or not they were there on site at the moment the anti-aircraft missile was launched?

We do know from folks that have said so publicly in the intelligence community that, in fact, they had to have been trained by Russians. They had to have gotten the equipment from Russia. Doesn't this make Vladimir Putin culpable for this plane crash?

KERRY: You know, culpability is a judicial term, and people can make their own judgments about what they read here. That's why we have asked for a full-fledged investigation.

Yesterday, on Friday, the investigators and the people who were needing access, the OSCE monitors, were given 75 minutes. And, obviously, the area is under the control of the separatists. Yesterday, they were given three hours. Today, we have reports of drunken separatists piling the remains of people into trucks in an unceremonious fashion, actually removing them from the location.

They are interfering with the evidence in the location. They have removed, we understand, some airplane parts. It is critical -- this is a very, very critical moment for Russia to step up publicly and join in the effort, in order to make sure there is a full-fledged investigation, that the investigators and people who are coming to help from outside, the ICAO, the FBI, the National Transportation Safety Board -- we're sending people over. Others are sending people, experts, who have an ability to be able to put these facts together, so no one will have doubt, no fingers will be pointed about conspiracies, about ideology and politics governing this.

We want the facts. And the fact that the separatists are controlling this in a way that is preventing people from getting there, even as the site is tampered with, makes its own statement about culpability and responsibility.

CROWLEY: And what is the U.S. doing about that today? What is different in your approach to Russia since this plane crash? If you believe that they have control or some say-so over what these separatists do...

KERRY: Well, yesterday...

CROWLEY: Mm-hmm.

KERRY: Yesterday, Candy, I had a direct conversation with my counterpart, Foreign Minister Lavrov. It was a direct and tough conversation. We will see if anything happens as a result of that.

I'm confident that President Obama will shortly be talking yet again with President Putin in order to find a way with very specific steps to move forward. But President Obama, I remind you again, the day before this event, unilaterally moved even before this to put tougher sanctions in place, what we call sector sanctions, sanctions that begin to do something about their energy companies, about their defense companies, about their banks.

Several of...

CROWLEY: Sure.

KERRY: ... of their biggest banks will now not be able to access the market.

(CROSSTALK)

CROWLEY: Do you think -- but, so far, these actions have not changed Russia's behavior in the least.

KERRY: So, that's why -- that's why they were ratcheted up. That's precisely the point.

I don't think anybody in America is yet talking about putting troops in there. Nobody is talking about military. The point is that we're trying to do this in a thoughtful way with a maximum amount of diplomatic energy and pressure.

And it would help enormously if some countries in Europe that have been a little reluctant to move would now recognize this wakeup call and join the United States and President Obama in taking the lead, and also stepping up. That's important.

CROWLEY: And, Mr. Secretary, I have to let you go, but I can't without asking you about Israel, which has now expanded, it says, its attack into Gaza to try to stop the missiles from coming into Israel.

We all know that the U.S. believes in Israel's right to defend itself. Are there, in your mind, any -- any line after which you think Israel has gone too far? Have those discussions taken place at all?

KERRY: Well, the president -- the president talked to Prime Minister Netanyahu Friday. I talked to Prime Minister Netanyahu yesterday. The president's talking to him again today. We're in constant conversations.

And I believe the president is asking me to go over there in very short order to work on the issue of a cease-fire. I was in touch yesterday with Secretary-General Ban Ki-Moon. We have agreed to meet at a certain time. We're working on the idea of a cease-fire.

Israel is under siege by a terrorist organization that has seen fit to dig tunnels and come through those tunnels with handcuffs and tranquilizer drugs, prepared to try to capture Israeli citizens and take them back to hold them hostage.

No country could sit by and not take steps to try to deal with people who are sending thousands of rockets your way literally in the middle of a conversation both with the president and with me. While we were talking to the prime minister, sirens went off. The prime minister of Israel had to interrupt the conversation with the president of the United States to go to a shelter.

People can't live that way. And Hamas needs to understand, we are supporting the Egyptian initiative for a cease-fire. We will work for a fair cease-fire, and we will work afterwards, as we have shown our willingness, to try to deal with the underlying issues,

But they must step up and show a level of reasonableness, and they need to accept the offer of a cease-fire. And then we will certainly discuss all of the issues relevant to the underlying crisis. No country has indicated a greater willingness to do that, and no president's been more willing to put himself on the line in recent time to do that than President Obama.

CROWLEY: So, as I understand it, what you are saying is that the U.S. is comfortable with Israeli actions thus far, but you would like to see a cease-fire?

KERRY: No. Candy, Candy, please.

No country, no human being is comfortable with children being killed, with people being killed. But we're not comfortable with Israeli soldiers being killed either or with people being rocketed in Israel.

So, you know, in war, it's very difficult. There tends not to be a sort of equilibrium in terms of these things. The fact is that we have asked Israel, and Israel has said, we will try to reduce whatever we can with respect to civilian involvement. And civilians have been warned to move well ahead of time.

The fact is that Hamas uses civilians as shields. And they fire from the home and draw the fire into the home, precisely to elicit the kind of question you just asked. We need to have a cease-fire.

CROWLEY: Secretary of State Kerry, very much appreciate your time this morning.

KERRY: Thank you.

(END VIDEOTAPE)

CROWLEY: Coming up: Israeli Prime Minister Benjamin Netanyahu on how long his military's operation in Gaza could last.

(COMMERCIAL BREAK)

CROWLEY: Welcome back.

You just heard the U.S. secretary of state say the U.S. is in full support of Israel's right to defend itself.

We are now joined by Wolf Blitzer. He is in Tel Aviv. Earlier, Wolf, I know you spoke with Israeli Prime Minister

Benjamin Netanyahu.

WOLF BLITZER, CNN ANCHOR: Candy, I just came from the Israeli Defense Ministry, where I sat down with the prime minister for an interview. We met in an area that's a secure room.

He pointed out to me that, if the sirens go off, if missiles are coming in, we don't have to move, because that was in effect a sheltered area, heavily surrounded by concrete. Fortunately, no sirens went off.

The interview which we're about to show our viewers here in Israel, indeed around the world, the interview points out that -- what we just heard from the secretary of state. At least for now, the U.S. and Israel seem to be very much on the same page.

(BEGIN VIDEOTAPE)

BLITZER: We're being seen now by viewers in the United States and around the world in more than 200 countries around the world right now.

Quick question. Your exit strategy from Gaza, what is it?

BENJAMIN NETANYAHU, ISRAELI PRIME MINISTER: Sustainable quiet.

I mean, we didn't seek this escalation. Hamas forced it on us. They started rocketing our cities, steadily increasing the fire. I called for de-escalation. They refused. I accepted an Egyptian cease-fire proposal backed up by the Arab League and the U.N. They refused.

I accepted a humanitarian lull proposed by the United Nations. They refused. We will stop our operations when we can bring back quiet to our people.

BLITZER: Some of your Cabinet ministers think the only way to do that is to reoccupy Gaza, which you evacuated from and gave it up back in 2005. Do you support reoccupying Gaza?

NETANYAHU: Well, I support taking whatever action is necessary to stop this insane situation.

Just imagine -- I mean, imagine what Israel is going through. Imagine that 75 percent of the U.S. population is under rocket fire and they have to be in bomb shelters within 60 to 90 seconds. So, I'm not just talking about New York -- New York, Washington, Chicago, Detroit, San Francisco, Miami, you name it.

That's impossible. You can't live like that. So I think we have to bring back, restore back a reasonable, sustained quiet and security. And we will take whatever action is necessary to achieve that.

BLITZER: But that includes possibly reoccupying Gaza? Because a lot of your military planners are afraid of what they would call a quagmire, a dangerous quagmire.

NETANYAHU: Nobody wants to go to excessive military plans, but what is happening here is excessive.

They're not only targeting our cities. They're deliberately firing thousands of rockets. They have already fired 2,000 rockets in the last few days on our cities. You can imagine this. It's not only that. And they wanted to kill as many of our six million Israelis who are targeted as they could.

They haven't succeeded not for lack of trying. It's because we have developed, with American help -- and I appreciate the help that President Obama and the U.S. Congress have given us to develop these Iron Dome, fantastic systems.

But some of the missiles perforate. And they hit our schools. So we have to stop that. But, in addition to the rockets, they have got now terror tunnels that they build in Palestinian homes in Gaza. They penetrate underground into Israeli territory.

Terrorists pop up there, try to murder civilians, kidnap Israelis, as they did with Gilad Shalit. So we're taking action right now to neutralize those tunnels. And we will continue the action as long as is necessary.

BLITZER: You see these painful pictures, though, of these Palestinian children and these refugees, thousands of them fleeing their homes. It's a horrendous sight, what is going on right now, if you look at the images, heart-wrenching.

What goes through your mind when you see that?

NETANYAHU: I'm very sad. When I see that, I'm very sad.

We're sad for every civilian casualty. They're not intended. This is the difference between us. The Hamas deliberately targets civilians and deliberately hides behind civilians. They embed their rocketeers, their rocket caches, their -- their other weaponry from where -- which they fire -- which they use to fire on us in civilian areas.

What choice do we have? We have to protect ourselves. So we try to target the rocketeers. We do. And all civilian casualties are unintended by us, but intended by Hamas. They want to pile up as many civilian dead as they can, because somebody said they use -- it's gruesome. They use telegenically dead Palestinians for their cause. They want the more dead the better.

BLITZER: The argument that your critics make is that you're overreacting right now, overkill.

NETANYAHU: Well, look, I want to say this.

I mean, there are very few examples in history of countries that have been rocketed on this scale. If you look at our response, it's actually very measured and trying to be as pinpointed as we can. But I think, when people say that -- I appreciate the support we have received from President Obama and many world leaders for Israel's right to self-defense.

But others are saying, yes, you have the right of self-defense, as long as you don't exercise it. What can a country do? What would you do? What would the people of the United States do if -- if your cities were rocketed now, 2,000 rockets falling in American cities?

People would say in the United States, as they're telling me, obliterate the people. We don't obliterate them. We don't want to -- we don't have any battle with the Palestinians in Gaza.

BLITZER: But it is brutal there now.

NETANYAHU: It is very difficult because Hamas is using them, Palestinians, as human shields.

We develop anti-missile systems to protect. We use an anti- missile system to protect our civilians. They use their civilians to protect their missiles. That's the difference. So, against such a cynical, brutal, heartless enemy, we try to minimize civilian casualties.

We try to target the military targets. And, unfortunately, there are civilian casualties, which we regret and we don't seek. They all fall on the responsibility of Hamas.

BLITZER: The president, President Obama, he urged you the other day to -- all the parties to return to the cease-fire that was reached in November 2012. Are you accepting his proposal, go back to that cease-fire?

NETANYAHU: Already did. I already did.

BLITZER: If Hamas were to say to you right now, we accept the cease-fire, would Israel withdraw its forces from Gaza?

NETANYAHU: That was the Egyptian proposal, which we accepted and they refused.

BLITZER: If they accepted now -- is it too late?

NETANYAHU: I don't know. I don't want to speak about it being too late. I think the first thing is a cessation of hostilities, but then we would have to get into...

BLITZER: Would Israel withdraw its forces as part of a cessation of hostilities?

NETANYAHU: Well, we would get into -- I believe -- first, we have to deal with this tunnel business, because we're not leaving those tunnels...

BLITZER: So, you would stay until those tunnels are destroyed?

(CROSSTALK) NETANYAHU: We're doing that right now, as we speak.

BLITZER: How long is that going to take?

NETANYAHU: It's being done fairly quickly.

But I think the important thing right now is not to begin to put terms. I think the important thing is to end the hostilities, and then get into a situation where we have a sustainable cease-fire. That means beginning to discuss the demilitarization of Gaza.

Gaza, under all the previous agreements, should have been demilitarized. Instead of being demilitarized, it became basically an Iranian-financed and equipped fortress of terror, with thousands and thousands of rockets and other weapons being smuggled and developed in it.

That has to stop. Those tunnels have to be shut down.

BLITZER: I have been here in Israel for, what, 10, 11 days. And many Israeli friends have said to me they are deeply concerned about what they see in this rise, tiny, but very violent and dangerous Jewish extremism in Israel.

We saw that with that murder of that young Palestinian boy in the aftermath of those three Israeli teenagers who were kidnapped and killed. How concerned are you about this? Because that police report that came out on that murder of that Palestinian, you have read that. That was awful.

NETANYAHU: Well, you know, here's the difference. We don't glorify these killers. We put -- we apprehended him in three -- three days after the -- that tragic killing, immediately put them in custody.

We're putting them on trial. They will serve a good chunk of their lives in jail. That's what we do with the killers. We don't name public squares after them. We don't glorify them. We don't educate our people, our children in suicide kindergarten camps, as happens in the Palestinian side.

And you should see what Hamas is educating them to, no peace, no two-state solution, nothing, just jihad, more and more violence, more and more murder, and more and more bloodshed.

This is not our way. We have -- I think a society is tested not by the extreme fringes of that society, but how it takes care of them. We take care of those extreme fringes. We basically isolate them and ostracize them and punish them.

I think what you see in Palestinian society, but especially in Gaza, is that these people are lionized. And the worst thing that I see, the worst thing is that they use their children, they use their civilians. They don't give any thought about them.

I mean, the Hamas leaders are divided into two. Those who are under -- in underground bunkers in Gaza, they don't care. Let the people there, you know, with the rocketeers and with the attack tunnels, let them die as Israel tries to surgically take them out. But they're safe underground, the military leaders.

And then they have got the political leader, this guy Khaled Meshaal, who is roaming around five-star hotel suites in the Gulf states, having the time of his life, while his people, while he's deliberately putting his people as fodder for this horrible terrorist war that they're conducting against us.

So this has to stop. And I think many people in Gaza understand that Hamas is destroying Gaza, destroying their lives. They have taken tons -- not tons -- tens of thousands of tons of concrete that we enable them to bring into Gaza to build skyscrapers, to build schools, to build hospitals.

You know what they did with that, Wolf? They put 700 tons of concrete into each one of these terror attack tunnels to penetrate Israel. Now, we have discovered dozens of them. So you're talking about tens of thousands of tons of concrete, instead of going for the benefit of the school, the population, is going for terrorism against Israel.

I think it -- I think the international community has to -- once this is put in place, we really have to undertake a program to demilitarize Gaza and to change the situation, because it's unacceptable. What makes it unacceptable is Hamas and Islamic Jihad.

These people are the worst terrorists, genocidal terrorists. They call for the destruction of Israel, and they call for the killing of every Jew wherever they can find them.

BLITZER: We're out of time, but one final question on Iran.

Now that the U.S., the five permanent members of the U.N. Security Council, Germany, they have agreed to a four-month extension, allowing these talks with Iran and its nuclear program to continue, does that mean a unilateral Israeli military strike potentially is off the table over the next four months?

NETANYAHU: Now, you know I never talk about -- about what Israel will do or not do.

But I think what is important is that there wasn't a bad deal, because there's no deal. And no deal is better than a bad deal. We will see what the extension produces. I think a good deal is what was achieved with Syria.

They're under the threat of U.S. military action. And with the joint effort by President Obama and President Putin, Syria removed its chemicals and the capability to make chemical weapons. They didn't just keep it in place, freeze it, and put it under a lock and put an inspector on it. They actually dismantled and removed.

That's not what Iran is holding out for. Iran wants to keep its capabilities and say, we will put a lock under and you can inspect it. But the whole idea for them is that, at a certain point, they

break the lock. The inspector will even say they broke the lock. It will take him a few weeks to put together the wherewithal for a nuclear bomb. That's a bad deal. Don't make that deal, because if you think the Middle East is bad now, with ISIS, with Hamas, with Hezbollah, and with Iran, wait until Iran, one of the pre -- the preeminent terrorist state of our time, has nuclear weapons.

Then I would say the world goes into a tailspin. Don't let it happen.

BLITZER: Mr. Prime Minister, thanks very much for joining us.

NETANYAHU: Thank you. Thank you, Wolf.

(END VIDEOTAPE)

BLITZER: So, Candy, there you have it. You heard the prime minister of Israel say the goal is to demilitarize Gaza. If that's the goal, this operation, by all accounts, that the Israelis have undertaken from the air, from the sea, and now on the ground will continue for quite a while -- Candy.

CROWLEY: It does sound like that.

Thanks so much, Wolf Blitzer in Tel Aviv.

Coming up next: Senator Dianne Feinstein on the frosty relationship between Russia and the U.S. following the shoot-down of MH17.

(COMMERCIAL BREAK)

CROWLEY: Joining me now, Senator Dianne Feinstein, Chairwoman of the Senate Intelligence Committee. Senator, thank you for joining us.

SEN. DIANNE FEINSTEIN (D), CALIFORNIA: You're welcome, Candy.

CROWLEY: It seems pretty clear from the intelligence, from what the secretary of state said earlier that, you know, Russian separatists used Russian equipment that they were trained on by Russians to bring down a commercial jetliner. So are you satisfied at this point with the U.S. response?

FEINSTEIN: Oh, I'm satisfied with everything John Kerry said this morning. I think he outlined the case clearly. I think the intelligence is backing up the fact that this was a missile from an SA11 Buk launcher, that the trajectories and signatures are such that we know it came up and within seconds hit either near or hit the plane.

I think what's unusual about this candidly is the coverage that CNN is giving it. It is bringing it into the home of everyone all over the world, the bodies that lay in the field, the stealing of personal property, stealing parts of the plane. I think this has become a huge human drama. And I think the nexus between Russia and the separatists have been established very clearly.

So, the issue is, where is Putin? And I would say, Putin, you have to man up. You should talk to the world. You should say if this was a mistake, which I hope it was, say it. Even if it was a mistake, it's a horrendous mistake to make. And I think it points out the futility of what's happening in the Ukraine, because there will be repercussions from this. I can't tell you exactly what those will be.

CROWLEY: What are those repercussions? Yes. I ask you this because one of the things that struck me -- there's a Pentagon briefing on Friday. We've had sanctions against Russia, meetings with Russia at almost all levels saying, get out of the Ukraine, stop supplying weapons to these separatists.

And I want to play something that the Pentagon Press Secretary Rear Admiral John -- I'm sorry, the Pentagon Press Secretary said, John Kirby, on Friday.

(BEGIN VIDEO CLIP)

REAR ADM. JOHN KIRBY, PENTAGON PRESS SECRETARY: We see no hint that Russian support for the separatists has ceased. In fact, we believe that Russia continues to provide them with heavy weapons and other military equipment, financing as well and they continue to allow these Russian fighters to enter Ukraine freely.

(END VIDEO CLIP)

CROWLEY: So, months of sanctions, months of warnings, get out, get out, get out, and Thursday, more sanctions. What makes anyone believe that Putin will man up?

FEINSTEIN: I think the world has to rise up and say we've had enough of this. I think Europe has to come together. I think Germany in particular has to lead. I think we have to continue with sanctions.

It's difficult...

(CROSSTALK)

CROWLEY: (INAUDIBLE) sanction (INAUDIBLE) failure?

FEINSTEIN: ...because you need Russia's help in so many things.

CROWLEY: Right.

FEINSTEIN: The P5+1, Syria, and it goes on and on. And a lot of our energy is tied up in Russia, but you cannot let this kind of thing happen and Russia continues to prepare it for the next strike-down of a civilian plane.

There are a lot of things that one can say as well, planes shouldn't have been over there in the first place, but the fact of the matter is that to use this kind of launching missile that travels at two to three times the speed of sound, that takes just seconds to get there, that's made for an entirely different purpose, to take down. Whether it is transports or helicopters, in this case a very large passenger plane filled with almost 300 people, including 80 children.

CROWLEY: But is there a chance here at this point that Putin's just in too deep? That he -- why would he want a full investigation? Why would he come out and say, sorry, this was a mistake. Yes, we did give them -- why would he do that?

FEINSTEIN: Well, I think this is where ICAO, where the United Nations has to step in. There have to be some penalties for this kind of a shoot-down, in this day and age, with the amazingly technical piece of equipment, which should only go to people who have some ethical compass/ Now we find out it's being given to separatists who are, in many respects, thugs, and it's being used in a very terrible way. And I think the world just has to rise up and say, enough.

CROWLEY: I want to play you something that John McCain said in terms of this administration as it deals with Ukraine.

(BEGIN VIDEO CLIP)

SEN. JOHN MCCAIN (R), ARIZONA: It's just been cowardly. It's a cowardly administration that we've failed to give the Ukrainians weapons with which to defend themselves.

(END VIDEO CLIP)

CROWLEY: Should the U.S. now give Ukraine the lethal weapons it has been asking for?

FEINSTEIN: Well, I don't know with specificity what weapons these are. I think the Ukraine has this ground-to-air missile system, but it's not in the area, and they're not using it. So, here's the thing --

CROWLEY: Right, there's not -- I mean the rebels don't have that many planes to shoot down, right?

FEINSTEIN: I don't think you can win this that way.

CROWLEY: Absolutely.

FEINSTEIN: I think you can only win it diplomatically.

CROWLEY: But if they're being given, if the rebels are being given all the sophisticated equipment from Russia, shouldn't the Ukraine government have what it needs that it feels to help get rid of the rebels?

FEINSTEIN: Well, this is -- emotion is at an all-time high. You see trees that are stripped by bullets. I'm opposed to giving this kind of equipment to anybody, to be honest with you, because we have now seen a major misuse. If this is what senator McCain is talking about, I'm not for this kind of thing.

CROWLEY: I've got less than a minute so I just need a yes or a no.

FEINSTEIN: OK, sure.

CROWLEY: Do you believe that the U.S./Russian relations are now at cold war levels?

FEINSTEIN: Yes.

CROWLEY: Thank you very much.

FEINSTEIN: You're very welcome.

CROWLEY: I appreciate it.

FEINSTEIN: Thank you, Candy.

CROWLEY: It's always good to see you, Senator.

Still ahead, Vladimir Putin seemingly complicit in the downing of MH17. The chairman of the House Homeland Security Committee, Congressman Michael McCaul, on how dangerous the Russian president might be.

(COMMERCIAL BREAK)

CROWLEY: Joining me now, the Chairman of the House Homeland Security Committee, Michael McCaul of Texas.

Congressman, thank you for joining us. I think sometimes...

REP. MICHAEL MCCAUL (R), CHAIRMAN, HOUSE HOMELAND SECURITY COMMITTEE: Hi, Candy.

CROWLEY: ...the eastern border of Ukraine, as it -- as it borders Russia seems like a very faraway place, does not -- it is not a complete circle for Americans to say, what is going on there as shown up by the downing of this commercial jetliner, has any effect on the U.S.? Can you draw that line for us? Is U.S. security under any threat because of what's going on in Eastern Ukraine?

MCCAUL: Well, I mean sure it is. And I think this say game changer what happened, the downing of this commercial flight by separatists tied to Putin. I think Putin is responsible and complicit for what happened, but why is that important to Americans? Because I believe, as you asked Senator Feinstein that we are -- Mr. Putin is returning to a cold war mentality.

When I was over there you could see this nationalistic pride, a sort of resurgence to regain the glory of the old days of the Soviet Empire and so we're seeing that happen with Crimea being annexed. We're seeing that happen with the Russian speaking peoples and the Ukraine and all throughout the Baltic States now, where I think his long-term strategy is to bring back into the fold, if you will, the glory days of the empire, these Baltic nations with the Russian- speaking people. So, in addition to that, Candy, it's a different threat. It's

not the al Qaeda threat, but it's a threat of brute force. It's a threat that could involve submarine warfare. We know that Russia is more fully engaged in every aspect of that type of warfare, and that concerns me from the Homeland Security standpoint.

CROWLEY: And if you look at the situation as it now is, and that cold war mentality, that Senator Feinstein spoke about and you do as well, what possible use can Russia be to the U.S. in Syria or in Iran, two places of direct strategic importance to the U.S.?

MCCAUL: Well, the only thing, we have a few things in common these days with Russia, but I think the one thing we do have in common is a -- a sort of a distrust, the hatred for the terrorists. And I do think they can be an ally with respect to going after ISIS, going after al Qaeda, al Nusra in Syria, which as you know the foreign fighters present the greatest threat to the homeland with clean travel documents.

They've got Dagestan. They've got the Chechen rebels right in their backyard, and there (ph) the Boston bombers came out of that region as well. So, I think that's one common area of interest that we do share with the Russians. I would urge the administration to work on.

But I think with respect to what happened again the -- I think the game changer aspects to this, the wake-up call in terms of what has happened and I think it calls for tougher measures on Russia from the United States.

The president's got to lead. Remember the last time the Russians did this was the Korean airliner and Ronald Reagan was president. And Ronald Reagan rallied the world community against Russia and what it was doing. I think this president needs to do the same thing.

CROWLEY: Sure. Different time of course, and right in the midst of the cold war, when that happened. But let me ask you, when you look at the president's response to this, Secretary Kerry's response today, they have been pretty tough, but they've also been pretty tough on Europe and said, you need to step up to the plate.

So, is it Europe that is lagging behind? Because the president did solo institute some sanctions on the part of the U.S. alone without some of those European allies.

MCCAUL: Well, I think Europe obviously has a big play here, a big factor, but let's face it, the president of the United States is the only body (ph) -- only person who can stop Putin from this act of aggression, this plane out of the Ukraine region. I think that he's the one that needs to, you know, stand for, call for a cease-fire that the president of the Ukraine has talked about. He needs to reassure NATO.

You know, there's a crude oil ban that he could lift tomorrow to allow Europe and Ukraine to have crude oil to get off this Russian dependence which strangles them and not only would that be good from a stability foreign policy standpoint, it would also create a lot of jobs in the United States. And I think that's the kind of things the president ought to be looking at.

CROWLEY: Well, the president has in fact called for a cease- fire. The Russians have allegedly agreed to try to help on their end of things. He has instituted some pretty stiff sanctions against some individual banks, some individual energy companies within the Russian community.

So, isn't this now a matter of Europe stepping up to the plate, Germany very influential on Russia and its actions, right?

MCCAUL: Well, I think Germany and Europe need to stand with the United States, but really only the president of the United States can really truly lead that effort. I think that's what this president needs to do to stop this aggression, otherwise it's going to continue to go on.

Sanctions will only work if they're tough enough to deter conduct. And I don't believe right now they are tough enough, and they don't hit the energy sector as hard as we could be doing. And the Europeans have actually called for us to lift this crude oil export ban which I introduced a bill to do just that. I think that would go a long way in a practical standpoint. But overall 30,000 feet, you know, the president of the United States is in the position to stop this. He needs to be a leader. He needs to stand up like Reagan did against the Russians in 1983, when they downed -- the last time they downed a commercial airliner.

CROWLEY: Congressman McCaul, thank you so much for getting up so early this morning, all the way out there in Austin, Texas. Appreciate your time.

MCCAUL: Thank you, Candy. I appreciate it.

CROWLEY: When we come back the morgues are full, bodies now filing up on the streets of Gaza. A man in the middle of the cross- fire joins us next.

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CROWLEY: The number of dead in Gaza creeps higher now and those who are surviving still find very few choices of a place to go.

Joining me, Robert Turner. He is Director of Operations for the United Nations Relief Agency in Gaza. Mr. Turner, thank you for being there for us this morning.

I want you to try to give our audience a picture of life in Gaza over the course of a day over the past week or so.

ROBERT TURNER, DIRECTOR OF OPERATIONS, UNRWA IN GAZA: Well, for many of the Gazans it's going to be a pretty terrifying time. We've had massive displacement. We've had a tripling in the number of displaced in the schools that we run here in Gaza over the course of the last couple of days. Just received figures we're now at 70,000 displaced moved into 55 or 57 of our schools. The number is changing literally by the minute. People are scared.

What we're seeing compared to previous conflicts is a higher proportion of the displaced coming to our schools. And when we asked them why, they said because they don't feel safe anywhere. There has been so many targets hit in residential areas, they don't feel safe at home. They don't feel safe with their families or their neighbors. They feel relatively safe in our installation

CROWLEY: Do you have a sense -- I know Israel has said that it tries to give warning to tell people where the next strike is coming, et cetera, et cetera. Do you have a sense of how many of those who are currently displaced will go home to find nothing there, that it has been destroyed by missiles?

TURNER: Well, we are trying to track, not UNRWA but the United Nations generally, and our partners, are trying to track the number of houses that have been destroyed and damaged. The last time I checked, more than a thousand homes had been either destroyed or damaged beyond repair.

The last figure I saw was 13,000 homes that have been likely damaged. So, that's before we had the significant incursions into Beit Hanoun (ph). And then today in the last 24 hours in the Shedain (ph) neighborhood, and the reports coming out of there are of very significant damage to the actual neighborhoods.

CROWLEY: Mr. Turner, I am going to assume the one thing you would most love to see is a cease-fire at this point. So, setting that aside, what do you most need now? What do the hospitals need? What does the U.N. need?

TURNER: Well, right now there is a number of operational requirements. You mentioned the hospitals. I was in Shifaa Hospital this morning speaking to the director there and to some of the staff. They desperately need more medical supplies, more disposables, more drugs. The generators are concern -- the generators are going to shut down because they've been running effectively full time and they're really only for emergencies. They're very concerned about the safety and freedom of movement of the medical staff and the ambulance staff so that's for the medical sector.

For us specifically, we, frankly, have been overwhelmed by the numbers. We ran out of mattresses yesterday. We're running out of hygiene kits. We have been able to keep up with fresh food and water. We're airlifting -- right now aircraft is being loaded in Dubai to fly mattresses and other nonfood items to Amman (ph) so we can get those back into Gaza as quickly as possible.

It's not enough to simply return to the situation we had two weeks ago which was untenable and unsustainable.

CROWLEY: Robert Turner, who is Director of Operations for the U.N. Relief Agency in Gaza. Thank you so much for taking time out of your very, very busy day.

TURNER: You're welcome. Thank you. CROWLEY: We'll be right back.

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CROWLEY: Thanks for watching STATE OF THE UNION. I'm Candy Crowley in Washington. Here to watch us each week at this time or set your DVR so you won't miss a moment.

Fareed Zakaria, "GPS," starts right now.