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THE SITUATION ROOM

New Storms Forecast as Millions Struggle to Dig Out; Trump Calls Ted Cruz a Liar; Trump Would 'Love' to See Bloomberg Run; Democrats in Tight Race Week Before Iowa Caucuses; Donald Trump, Anti- Establishment But a Deal-Maker?. Aired 5-6p ET

Aired January 25, 2016 - 17:00   ET

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


[17:00:03] JAKE TAPPER, CNN HOST: Randi Weingarten, thank you so much for your time.

That's it for "THE LEAD". I'm Jake Tapper, turning you over now to Wolf Blitzer in THE SITUATION ROOM. Thanks for watching.

WOLF BLITZER, CNN ANCHOR: Happening now, digging out. A crippling blizzard leaves dozens dead. Now with roofs collapsing, 85 million people coping with a mess and roads refreezing overnight. Could one or even two new storms be just over the horizon?

Digging in. Donald Trump sits down with me for a one-on-one interview. He's spoiling for a fight with Michael Bloomberg, says his critics got his latest joke all wrong. And savages his closest competitor, Senator Ted Cruz.

Making their case. We're only hours away from the Democratic presidential candidates squaring off with Iowa voters, taking questions on the most important issues facing the country. With just one week to go until the Iowa caucuses, how could CNN's exclusive town hall impact this race for the nomination.

And mystery man. New details about the American almost nobody knew Iran was even holding until he was released. Was he an FBI informant?

I'm Wolf Blitzer. You're in THE SITUATION ROOM.

ANNOUNCER: This is CNN breaking news.

BLITZER: We're following breaking news. Forecasters are keeping their eyes on developing storms that could be over the snow-packed eastern U.S. by midweek and again this weekend. More snow would be the last thing 85 million Americans need, but even rain could cause new problems if it freezes on the roads and highways.

We're standing by for a live update on the struggle to clean up the mess left behind by this weekend's record-setting blizzard.

We're also following breaking news in the presidential race. With just one week to go until Iowa caucuses, the Democrats will face Iowa voters tonight, exclusively right here on CNN. And Donald Trump sits down with me for an eye-opening and news-making interview. Our correspondents, analysts and guests, they're standing by with full

coverage of the day's top stories. Let's begin with the blizzard cleanup. CNN's Brian Todd spent much of the weekend on the hazardous roadways around Washington, a city still largely shut down.

Brian, where are you now, and what is it like tonight?

BRIAN TODD, CNN CORRESPONDENT: Wolf, we're in northeast D.C. This is D.C.'s biggest snow dump, the parking lot at RFK Stadium here in northeast Washington. Mountains of snow everywhere you look. It is loud; it is dirty. You could pass out from the smell of exhaust fumes, but it is necessary.

And this is one of the biggest logistical headaches following the snowstorm: where to put all of it. This is where they're putting it for the moment.

But still, D.C. officials are telling people stay off the streets. They have got to have time and space to clear the streets tonight. This is happening as officials up and down the East Coast are still assessing the damage from this massive snowstorm.

(BEGIN VIDEOTAPE)

TODD (voice-over): The big dig, up and down the East Coast. Major highways cleared, but smaller roads and the people who live there still buried.

UNIDENTIFIED MALE: It's just wet, and it's heavy. And it's two feet, almost two feet tall.

TOD: The damage throughout the region is still being tallied. Roof collapses like this church in Silver Spring, Maryland. Crashes and spinouts over the weekend, like this accident between a snow plow and a train in Stamford, Connecticut.

And more than two dozen fatalities, including an Ohio teenager killed sledding and a woman and child who died in this car in New Jersey of carbon monoxide inhalation while trying to stay warm on a street as the father was shoveling the car out.

Severe coastal flooding that wrecked shoreline towns in New Jersey and Connecticut, but also stories of rescues of the motorists who are spun out in snow banks, stranded for agonizing hours on highways in Kentucky and Pennsylvania. Officials in Washington are upset with comparisons to New York and assertions that D.C. hasn't bounced back as quickly.

CHRIS GEIDART, D.C. HOMELAND SECURITY AND EMERGENCY MANAGEMENT: We're doing everything we can down here to get our city back where it needs to be. I see the efforts of all the crews that are out there day and night, 24 hours a day.

TODD: Airports are offering at least partial service in New York, Philadelphia and Washington.

UNIDENTIFIED FEMALE: My flight looks good so far.

TODD: But still hundreds of cancellations or delays, and many suburban train and Metro stations are still closed.

MAYOR BILL DE BLASIO (D), NEW YORK: Things are not entirely normal today, but a lot of the city is operating well.

TODD: But not problem-free. This empty school bus got stuck in Queens, New York, and it took several people to push this car out in D.C. Officials in Washington are warning residents not to risk their health shoveling, not to push snow into the street, and not to walk in the streets.

D.C. officials say there are large temporary snow piles on street corners. Motorists have little or no visibility rounding those turns and suddenly encounter pedestrians or vehicles right in their path. Some pedestrians say they've got nowhere else to go.

[17:05:03] UNIDENTIFIED MALE: The sidewalks out there are totally unshoveled, so it's not like you have a lot of choice.

TODD: With so much snow, a huge logistical problem is where cities will put it all. D.C. is putting some of it into dump trucks and then creating small snow mountains in a stadium parking lot.

DAVE SCHNEIDER, DUMP TRUCK DRIVER: Oh, it's a horror show. There's just no way to keep up with it right now.

(END VIDEOTAPE)

TODD: Tons of snow still being dumped here at RFK stadium since the predawn hours, creating these small snow mountains as far as the eye can see. Line upon line of dump trucks coming in tonight. They have been doing this since yesterday.

But officials tell us, wolf, they are not going to let this stuff sit here. They're bringing in a large snow melter, a big machine mounted on a truck that we're told can melt about 60 tons of snow per hour. They are going to need it here, Wolf.

BLITZER: They certainly are. Brian Todd reporting for us, thank you. We're going to have more on the forecast a little bit later. But let's get to the breaking news and some of the harshest attacks yet in the presidential race.

Donald Trump, he's beginning a last-minute campaign sprint through New Hampshire and Iowa, but not before sitting down with me and calling Senator Ted Cruz a liar.

Before we get to my one-on-one interview with the Republican presidential frontrunner, let's go to our senior White House correspondent, Jim Acosta, who's in New Hampshire for Trump's upcoming campaign rally.

What's the latest there, Jim? JIM ACOSTA, CNN SENIOR WHITE HOUSE CORRESPONDENT: Wolf, taking a

break from Iowa, Donald Trump will be here in New Hampshire in a few hours. Trump has a big lead in both of these crucial early states, giving his rivals a growing sense of urgency as they are running out of time to catch up.

(BEGIN VIDEOTAPE)

ACOSTA (voice-over): One week until the Iowa caucuses and boasting a commanding lead, Donald Trump is warning his supporters in a video posted on Facebook, Washington political establishment is out to get him.

DONALD TRUMP (R), PRESIDENTIAL CANDIDATE: They are really trying to stop me. Everybody knows it. Everybody sees it.

ACOSTA: But this ultimate outsider is now charting a more conventional path. Instead of flying back to New York over the weekend, he spent the night in an Iowa hotel and stopped at a local church.

TRUMP: It was really good. I learned something. We talked about humility at church today.

ACOSTA: Trump showed that humility can only go so far at a rally, bragging his voters will back him no matter what.

TRUMP: I have the most loyal people. Did you ever see that? I could stand in the middle of Fifth Avenue and shoot somebody, and I wouldn't lose any voters, OK? It's like incredible.

ACOSTA: Trump's main rival in Iowa, Ted Cruz, is confident he will catch the GOP frontrunner, poking fun at the billionaire tycoon's recent biblical slip-up.

TRUMP: Two Corinthians, right?

SEN. TED CRUZ (R-TX), PRESIDENTIAL CANDIDATE: Two Corinthians walk into a bar. Ah, yes, Ricardo Montalban. Genuine Corinthian leather.

ACOSTA: To slow Trump's momentum, the Cruz campaign is pointing to some high-profile endorsements. Former Texas Governor Rick Perry.

RICK PERRY, FORMER TEXAS GOVERNOR: Ted is the leader that we need to reignite the promise of America.

ACOSTA: To talk show host Glenn Beck.

GLENN BECK, TALK SHOW HOST: Donald Trump, I really truly believe is a very dangerous man. If you disagree with him, he destroys you.

ACOSTA: But the Texas senator has no shortage of critics, who dug up this video of Cruz as a teenager joking about taking over the world.

CRUZ: World domination, rule everything, rich, powerful, that sort of stuff. ACOSTA: Looking for a last-minute surge. Marco Rubio is campaigning

with Iowa's popular senator, Joni Ernst, after picking up the endorsement of "The Des Moines Register," although that was hardly the most talked-about endorsement of the week.

TINA FEY, FORMER CAST MEMBER, NBC'S "SATURDAY NIGHT LIVE": The next president of the United States, Donald J. Trump.

ACOSTA: As Tina Fey proved on "Saturday Night Live."

FEY: I'm just here because he promised me a spot in his cabinet. And I belong in a cabinet, because I'm full of spice, and I've got a great rack.

(END VIDEOTAPE)

ACOSTA: And Trump heads back to Iowa tomorrow, but he will spend some time in South Carolina later this week, showing Trump is feeling so good about his chances that he's already looking ahead to these battles looming ahead; and there are many more to come, Wolf.

BLITZER: Jim Acosta recording for us. Thank you. I sat down with Donald Trump this morning just before he left on his latest campaign trip.

(BEGIN VIDEOTAPE)

BLITZER: Mr. Trump, thanks very much for joining us.

TRUMP: Thank you.

BLITZER: All of a sudden in Iowa, you've got double-digit leads, according to the CNN most recent poll. Is this now a two-man race?

TRUMP: I don't know that it is. I doubt it is. You know, you never know what's going to happen. I'm working very hard in Iowa. That's the one where somebody is closest to me, but I took a pretty big lead over the weekend if you saw the polls that came out, including yours. We've taken big leads everywhere. I mean, nationally big leads. In New Hampshire very, very big. In South Carolina, amazing. So Iowa is very important to me.

BLITZER: What do you have that Ted Cruz doesn't have?

TRUMP: Well, look, I don't want to knock anybody, but he's got a lot of problems. He's got a problem with his Canadian birth. He was born in Canada. It's a real question. As you know, Laurence Tribe from Harvard and many other lawyers are saying he can't do what he's doing. He's not allowed to run. And you have some lawyers that say definitively he cannot run.

BLITZER: Is that why his numbers have gone down in Iowa?

TRUMP: I don't know. I think it has an impact, because I think they said 36 percent of the people agree that he can't run for president. He was born in Canada, and he was born on Canadian soil. Now, he can run for prime minister of Canada, but I don't think he can

-- I honestly don't know if he can run.

And there's a question mark. And you know, if he ever got the nomination, the first thing that will happen the first day, the first week will be he will be sued by the Democrats. And that's going to be it. I mean, you know, what are they going to do, go two years and nobody's going to know? It would take years to go through the court system.

So he should solve that problem. In addition to that, he has the Goldman Sachs problem where he borrowed a lot of money and never said it. Then he borrowed money from Citibank and he never told anybody. He never disclosed it.

BLITZER: He did disclose it to one entity of the federal government but not to another.

TRUMP: He didn't put it in his personal disclosure form, OK, financial disclosure form. And you've got to do that. You've got to do it. He's got two banks. But he didn't do it for a reason. He didn't do it, because he doesn't want people to see that he's borrowing from banks that he's supposed to be regulating.

BLITZER: The establishment Republican candidates, basically four, Marco Rubio, Chris Christie, Jeb Bush, John Kasich, who do you see as your biggest threat?

TRUMP: I don't really view anybody. I just want to do my own thing, Wolf. I mean, I could say this one, that one, what difference does it make? I just want to do my own thing.

We're really resonating. We're doing great with evangelicals in Iowa, as an example. Nationwide I'm leading with evangelicals by a lot. And we're doing fantastically with the Tea Party. They're terrific people. We're doing great with the Tea Party. We're doing great with everything.

I mean, I'm leading every national poll by a lot, and now I'm leading every single state. In most cases by a lot.

BLITZER: You just posted a Facebook video. You say the establishment is against you. Why do you say that?

TRUMP: Well, I think the establishment actually is against me but really coming online, because they see me, as opposed to Cruz, who is a nasty guy who can't get along with anybody.

You know, look, at a certain point you've got to make deals. We can't have a guy who stands in the middle of the Senate floor and every other senator thinks he's a whack job. Right? You know, you have to make deals; you have to get along. That's the purpose of what our founders created.

And Ted cannot get along with anybody. He's a nasty person. You don't see that. And even when he was supportive of me, I kept saying watch what's going to happen, he's a nasty guy. And he brought it up at the debate. He started it; I finished it. But he brought it -- you know, he started getting very bad at the debate.

And then he tells lies. I mean, he said I knocked down some woman's home; I bulldozed it. I never knocked down her home. She didn't want it. And the words "eminent domain." You wouldn't have roads. You wouldn't have airports. You wouldn't have hospitals. You wouldn't have schools. You have to have eminent domain.

By the way, the Keystone Pipeline is all based on eminent domain. You wouldn't move that thing ten feet without taking that land on which it sits.

And by the way, all those people get paid a lot of money. It's not like they take it. They take it and pay a lot of money. But he makes a big deal out of them. You wouldn't have a country. You wouldn't have one highway in this country if you didn't have that. You wouldn't have a railroad. You wouldn't have anything.

So they make it eminent domain, because most people don't know what it is.

Then they have me taking a woman's house. I never took the woman's house. I never knocked down anybody's house. But they show a bulldozer knocking down a house. It's really false stuff.

BLITZER: You have very loyal supporters.

TRUMP: I do.

BLITZER: In fact, you -- I think you were joking, but you said -- it's getting a lot of buzz. You said you could stand in the middle of Fifth Avenue and shoot somebody. That wouldn't affect the support you're getting from your supporters.

TRUMP: Well, you don't think I was joking. You know I was joking. Of course I was joking. The whole room was laughing, and I was laughing when I said it.

BLITZER: Because it got -- you know, you got some criticism.

TRUMP: Well, no, from dishonest press. They said, "Oh, he said something." When they show me, I'm laughing; they're laughing. Everybody is laughing. Everybody is having a good time. Of course I'm joking. I mean, you know that.

But -- and the purpose of that is to say that people love me. You know, they want to stay with me; they're loyal. They're tired of seeing our country being pushed around and led by people that are stupid people. They're tired of it, Wolf.

I mean, we're tired of the Iran deals. We're tired of the Sergeant Bergdahl deals, where we get a traitor and they get five of their killers that they've wanted for years. They're tired of dealing like this. We're just -- we can't take it anymore. And people are looking at it,

and they're looking at me. And they have confidence in me. You know, I built a great, great company, and I'm going to use that talent now to do it for the United States.

BLITZER: Another New Yorker who's built a great company is Michael Bloomberg, the former mayor of New York City. He's now toying with the idea as running as a third-party independent. If he were to do so, could you beat him?

TRUMP: I'd beat him, and I would love him to do it, actually. I love the competition. I love the competition. I would love for Michael to do it. You know, we used to be friends. I guess we're not friends anymore. I don't think we are. But we used to be friends, good friends.

When I had a problem -- he had a big problem in the Bronx, I cleared up the problem. It was a big project that was -- they were unable to get it built. It was under construction for, like, 25 years. Way, way over budget. I took it over. I got it knocked out in one year, and now it's a tremendous success. Michael asked me if I'd get involved in it, and I'm the one that got it done and did a great job.

BLITZER: Well, it good be competitive.

TRUMP: I hope he's going to do it. I don't know that he is.

BLITZER: There's a lot of murmuring that he might do it.

You listed your net worth at about $10 billion. Forbes says -- we just checked it -- $36.5 billion for Michael Bloomberg.

[17:15:11] TRUMP: Yes, I don't believe that. I don't believe that.

BLITZER: You don't think he's worth...?

TRUMP: It's a technology company. I mean, if somebody came in, frankly, and comes up with a better machine than him, people stop using his machine.

BLITZER: So what do you think he's worth?

TRUMP: I don't even know why -- I have no idea. I don't even know why other companies haven't come up with a better machine. I mean, why? It's so simple. They come up in such a competitive world. But for some reason they haven't come up with a machine. I don't know. Maybe because he was the mayor of New York? I don't know. But they haven't come up -- and it's so easy to do, you would think.

So I think it's very fragile. I like real estate better.

BLITZER: If he says he's ready to spend a billion dollars of his own money to be elected president, are you ready to match him dollar for dollar?

TRUMP: I don't know. BLITZER: If you're the Republican nominee.

TRUMP: I don't think he's going to do that. I don't think he's going to run, actually. But I may be wrong. But I don't think he's going to run.

BLITZER: Why don't you think he might run?

TRUMP: I'm the only -- so far if he comes in, he'd self-fund. I'm the only person self-funding. Everyone else -- I mean, Ted Cruz is totally, totally conditioned down to the oil companies. I mean, the oil companies control him and others.

You look at Jeb Bush, poor Jeb. I mean, here's a guy that spent 100 and some odd million dollars already, and he's almost last. What he's done to the Bush family, and he doesn't even want to use the Bush name. He's ashamed of the Bush name. What Jeb Bush has done to the Bush family is very sad.

Then he brings out his mother. I said, "Jeb, your mother can't help you with ISIS. She can't help you with China. She can't help you with these people, Jeb. You've got to do it yourself." But here's a guy who spends over $100 million, and he's nowhere. I mean, he's -- I think he's disgraced himself, to be honest with you.

But you have all these people. Whether it's Jeb or Hillary or anybody, they're all controlled by the people that give them the money. I'm putting up my own money. I'm self-funding, which is very nice.

(END VIDEOTAPE)

BLITZER: We have much more to hear from my interview with Donald Trump. Up next, he talks candidly about what happens if he were to lose in Iowa. And I also ask him who he'd rather run against: Bernie Sanders or Hillary Clinton.

(COMMERCIAL BREAK)

BLITZER: We're following breaking news in the presidential race. With just one week to go until the Iowa caucuses, I sat town with Donald Trump this morning to get his candid assessment on where his campaign stands.

(BEGIN VIDEOTAPE)

BLITZER: You've called Bernie Sanders a total whack job. You've said you don't know if Hillary Clinton will make it legally. Who would you rather face in a general election contest?

TRUMP: I don't care, really. I don't even focus on them. I only focused on Hillary for a couple of days last week, as you saw. I don't even think about Hillary, and I don't think about Bernie Sanders.

The first thing I have to do is we had 17. Now we're down to about 12 or 13. I've got to get rid of them. I've got to win against them. A lot of them I like. They're good people. There's some really good people in that group. I mean it. Really good people. And people that have become friends of mine. You don't see that, because you won't report on that stuff. You know, the conflicts are more fun, right?

But I can't tell you, really, who I'd rather have. I give it a lot of thought, actually, believe it or not. But I don't think it matters.

I can say this: I will win. I'll bring in states that nobody ever thought of. I think I have a chance to win New York. I defended New York. Nobody else was going to defend New York -- last debate and got good credit for it. But the people in New York love that I defended them, because nobody ever defends New Yorkers, right?

I'm going to win Pennsylvania. I'm going to win West Virginia. I'm going to win Virginia. I'm going to win Michigan. Because I protect the car industry. Nobody else protects the car industry.

BLITZER: You really think you have this Republican nomination in the bag?

TRUMP: No, I think that I have a good chance. I mean, look, I'm leading in all the polls.

Iowa is very important to me. I should say to you -- I should say, "Well, I'd like to do well in Iowa." I don't want to do that. I'd love to win Iowa. If I don't win it, I don't win it. I'll go to New Hampshire, where I have a very big lead, and the people up there have been unbelievably good to me.

But Iowa is very important to me, and I have a great bond with Iowa. And I'm going to keep Iowa where it is. You know, there's a big move to move Iowa to the back of the pack in the next election cycle. I'm not going to do that; I'm not going to let that happen. I have a great bond.

You look at a guy like Cruz. He came out totally opposed to ethanol. Well, that -- you know, that affects many, many farmers and many, many jobs in the state of Iowa.

If I was in Iowa and somebody said, "I'm opposed to ethanol," I would absolutely not vote for him.

And then the governor came out and said, "You should not vote for him." I mean, they pointed. He said -- it wasn't like vote for somebody. I've never even see that. Don't vote for this guy; he's really bad for Iowa.

So I think that, you know, I'm going to do well in Iowa. I bonded with the people. I bonded with the evangelicals. I bonded with the Tea Party and the people of Iowa.

(END VIDEOTAPE)

BLITZER: Coming up, Donald Trump is renewing his attacks on debate moderator, Megyn Kelly. Will the GOP frontrunner participate in the next Republican debate? There's a whole lot more coming up in my sit- down interview with Donald Trump.

Plus, the Democrats are making their final pitches in Iowa with just one week before the caucuses. Hillary Clinton and Bernie Sanders are in a frantic scramble for support.

(COMMERCIAL BREAK)

[17:28:35] BLITZER: During my interview with Donald Trump, the GOP frontrunner explained he was only joking when he said he could shoot someone in the middle of Fifth Avenue and still not lose his loyal supporters.

Let's get reaction to that and more from our political experts. We're joined by our senior political analyst, Ron Brownstein. He's the editorial director of "The National Journal." David Swerdlick is an assistant editor at "The Washington Post," and our chief political analyst, Gloria Borger.

Gloria, react to what Donald Trump is saying, that he's only joking about that statement. He does have very loyal supporters.

GLORIA BORGER, CNN CHIEF POLITICAL ANALYST: You know, he's saying what a lot of people in the media have been saying all along, which is no matter what he says, he seems to just defy gravity and continue to go up in the polls. And so, you know, he said it was a joke. We have to take him at his word on that.

But he's absolutely right, because he is continuing to go up in the polls. When you look at the national polling, say from November when he was in the high 20s -- and don't forget, this is in an extraordinarily large field -- now he's at 34 or above nationally.

So whether he talks about not letting Muslims into the country or firing a gun in the middle of Fifth Avenue, it doesn't -- it doesn't seem to matter, Wolf.

BLITZER: Ron, if the former New York mayor, Michael Bloomberg, decided to run, how would that impact the dynamic, the numbers of this race?

RON BROWNSTEIN, CNN SENIOR POLITICAL ANALYST: Externally. By the way, just to amplify Gloria's point, six polls out in the last week:

[17:30:00] two national, two Iowa, two New Hampshire. All of them, Trump between 31 and 37. Around 40 percent among non-college Republicans, 30 percent among college Republicans. His vote has converged, both nationally and in the key early states, in a striking way.

Look, for Bloomberg, the map, the challenge of the third-party is winning states. I think if you had a polarized enough set of choices at the Republican and Democratic level, for example, of Bernie Sanders and a Donald Trump, there's a lot of popular vote that a centrist third-party candidate could get, perhaps as much as Bernie Sanders got in 1992, when he had the best showing since 1994, independent candidate.

The problem, Wolf, is winning states. As a third-party candidate you have the risk of finishing second to the Republican in all of the red states, second to the Democrat in all of the blue states. Where you can win enough states to truly contest this, I think would be a big hurdle that former Mayor Bloomberg would have to cross in his own mind before he invests the money.

BLITZER: Fair point. David, Donald Trump also says he doesn't care if he were to run against Bernie Sanders or Hillary Clinton. Do you buy that?

DAVID SWERDLICK: I mean, I buy it for now, Wolf. Right now Trump is trying to present himself as someone who's comfortable and strong taking on any and all comers. So he's going to say to Republican voters right now, the ones who are actually going to be casting ballots in Iowa and New Hampshire for him right now, that sure, he's comfortable with Clinton or Sanders as a general-election opponent.

He's consolidating strength in the Republican race and not worrying as much about, you know, the demographic realities of facing a Democrat down the road. But down the road he will probably favor one or the other candidate, depending on how the Democratic race shapes up.

BLITZER: Gloria, Trump also keeps painting Ted Cruz, his main rival right now, as untrustworthy and nasty. You heard him telling me about Cruz, "he tells lies." He's jumped ahead in Iowa. How effective is all of this questioning...

BORGER: Very.

BLITZER: ... of Cruz's character?

BORGER: You know, it's been -- it's been very effective. It's another one of those talking points that he has that everybody kind of says, "Oh, really?" at the beginning, and then, eventually, it seems to take root and flourish. And that's exactly what's happened with this.

And, you know, Trump is a man with his eyes on the prize. The prize is Iowa. Cruz stands in his way. Cruz needs to win Iowa to become a really viable contender, OK? And Trump knows it. And so right now, he's looking to knock out Ted Cruz any way that he can. And so this was one shot he took, and it's been working.

BLITZER: Everyone stand by for a moment. We're going to have much more on my interview with Donald Trump coming up.

But first, there are important new developments in the race on the Democratic side, as well. We're just days away from the Iowa caucuses, and Hillary Clinton's once formidable lead in that state has vanished. Both Clinton and her closest challenger, Senator Bernie Sanders, they're now in a desperate battle to win over supporters as time runs out.

Our Brianna Keilar is joining us from Des Moines right now following the Democratic campaign for the White House. The candidates, are they making their final pitches now?

BRIANNA KEILAR, CNN CORRESPONDENT: Yes, they certainly are, Wolf. In fact both -- or all of them having final -- final days of campaigning before this town hall tonight that they are going to be doing on CNN, a number of events that they are doing, trying to eke out every last bit of support in what has become a very tight race here in Iowa.

(BEGIN VIDEOTAPE)

HILLARY CLINTON (D), PRESIDENTIAL CANDIDATE: Let's build on what we have.

SEN. BERNIE SANDERS (D-VT), PRESIDENTIAL CANDIDATE: The energy, the excitement is with our campaign.

CLINTON: Whoa, well...

KEILAR (voice-over): Tonight just one week before the Iowa caucuses, Hillary Clinton and Bernie Sanders make their closing arguments. Clinton's, she has the experience to be president.

CLINTON: The truth is, I need your help. I'm out there making the case that I have the experience, the judgment and the vision and plans to really move our country forward.

KEILAR: Sanders' closing argument: he has the enthusiasm to win.

SANDERS: When people have turned their backs on the political process know that now is the time they're going to have to stand up, fight back and get involved in the political process, that is our campaign. We are the campaign that can defeat right-wing Republicans in November.

KEILAR: The race in Iowa a dead heat, Clinton getting a boost with an endorsement from "The Des Moines Register" editorial board. President Obama waiting to endorse until there's a nominee, but noticeably talking up Clinton in a politico interview.

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: I've gotten to know Hillary really well. And she is a good, smart, tough person who cares deeply about this country. And she has been in the public eye for a long time and in a culture in which new is always better, that's a disadvantage to her.

KEILAR: A potentially huge shakeup, a source tells CNN former New York City mayor Michael Bloomberg is seriously considering an independent bid, willing to spend up to a billion dollars of his own money.

[17:35:05] MICHAEL BLOOMBERG, FORMER MAYOR OF NEW YORK CITY: The public at the moment thinks the government is not working.

KEILAR: The source says he'll decide by early March.

Both Democratic candidates are downplaying their concerns about a Bloomberg run, Sanders saying especially if the general election race shapes up to be him, Donald Trump and Bloomberg.

SANDERS: The American people do not want to see our nation move toward an oligarchy, where billionaires control the political process. I think we'll win that election.

CLINTON: The way I read what he said was "If I didn't get the nomination," he might consider it. Well, I'm going to relieve him of that and get the nomination so he doesn't have to.

(END VIDEOTAPE)

KEILAR: But actually, Wolf, a Bloomberg confidant telling CNN that that's not really the case, that he would actually consider a run even if Hillary Clinton is the nominee. He is expected to make up his decision -- up his mind on that in March.

But another potential dramatic twist in what's shaping up to be a battle here in these final days before Iowa on the Democratic side.

BLITZER: It's already a pretty amazing race to begin with. If Bloomberg throws his hat into the ring, it would be very, very intriguing. Wow, the only word I can think of right now.

All right. Brianna, stand by. We have a lot more coming up, including much more of my interview with Donald Trump. We'll take a break. We'll be right back.

(COMMERCIAL BREAK)

[17:40:56] BLITZER: We're just one week away from the Iowa caucuses, and the polls show the contests on both sides to be very close. We're back with our political experts.

Gloria, do you think President Obama's sort of embrace in that interview he did today of Hillary Clinton potentially could alienate some voters? How do you think this is all playing out tonight?

BORGER: Well, you know, look, in the -- in the Democratic caucuses, the people who are already alienated from President Obama and don't like Hillary Clinton are in the Bernie Sanders camp. And, you know, we've seen that.

And I think that President Obama's kind of half a hug to Hillary is not really surprising. Hillary has an 80 percent approval rating. Bernie Sanders has 79 percent approval rating, according to our polls, so they're both doing pretty well among Democrats.

The place where it could have some impact, Wolf, is not so much in the Democratic Party, because Obama is pretty popular in the Democratic Party generally, except for those who think he hasn't been -- gone to the left enough.

But it could really have an impact in a general election, where Republicans will be saying, "If you want a third Obama term, vote for Hillary Clinton." And so they could replay the president over and over again and remind voters that, you know, Barack Obama loves Hillary Clinton.

BLITZER: Good point. Ron, Bernie Sanders, he's ahead right now in Iowa and way ahead in New Hampshire, according to all the most recent polls, but his pathway toward a nomination is still less clear. What could he do tonight in the CNN town hall to widen his support?

BROWNSTEIN: Well, I think, as you say, the widening is the key. You can win Iowa and New Hampshire on the Democratic side and still not really reflect the totality of the Democratic coalition, because they're both 90 percent white states, and minorities will probably cast about 40 percent of the total Democratic primary vote. That is the big hill he will have to climb eventually, if he's going to really contest this and get beyond winning places like Iowa, New Hampshire, Minnesota, Oregon, Connecticut, Vermont, you can make the list. He has to crack into that African-American and Latino support for Hillary Clinton.

The other thing he has to do, though, in all likelihood, is expand the electorate. We saw that with Barack Obama in 2008. People talk about it all the time. They rarely do it. But the youth share of the vote significantly increased in Iowa in 2008. Bernie Sanders needs that again here in 2016, and he probably needs it even more, Wolf, in states down the line. He will need those young voters where he is really trouncing Hillary Clinton now to show up in bigger numbers than before.

BLITZER: Yes, he had a huge crowd in Ames, Iowa, today at Iowa State University, Bernie Sanders. A lot of young people there were very enthused.

David, I interviewed a South Carolina state representative who actually had supported Hillary Clinton but switched and now switched. He now supports Bernie Sanders. Could more Hillary supporters, let's say in South Carolina, the third contest, make this move, especially if Bernie Sanders does well in both Iowa and New Hampshire?

SWERDLICK: Yes, I think the key is will Bernie Sanders do well or beat Clinton in either Iowa or New Hampshire or both? And if so, that will be critical when you go into South Carolina, a state where the Democratic base is more diverse, heavily African-American, and Sanders will need to peel away some African-American support in particular, but support in general from Clinton in South Carolina and other southern states.

I don't see that trend yet, but I think I do see a trend where Senator Sanders is clearly making an effort. He's been making an effort for months to get African-American support. Meeting with Black Lives Matter activists, meeting with other African-American leaders. But right now Senator Clinton, the polls show, at least the polls I've seen, still has much more support among African-American voters, which is a key, if not the key Democratic constituency.

BLITZER: Especially in South Carolina.

SWERDLICK: In South Carolina.

BLITZER: Not necessarily in Iowa or New Hampshire.

SWERDLICK: Correct.

BLITZER: But certainly in South Carolina right now.

All right, guys. Stand by. We're only hours away from CNN's Democratic presidential town hall in Iowa. Bernie Sanders, Hillary Clinton and Martin O'Malley, they will face the voters, take their questions live from Des Moines. CNN's Chris Cuomo will moderate that. It airs tonight, 9 p.m. Eastern only here on CNN.

[17:45:01] Coming up here in THE SITUATION ROOM, more with our political experts and more of my interview with Donald Trump, who's launching new attacks on debate moderator Megyn Kelly.

(BEGIN VIDEO CLIP)

DONALD TRUMP (R), PRESIDENTIAL CANDIDATE: I might be the best thing that ever happened to her. Because whoever even heard of her before the last debate?

(END VIDEO CLIP)

(COMMERCIAL BREAK)

BLITZER: We're following the rapidly changing political landscape just one week before the Iowa caucuses. We're back with our political experts.

Gloria, how much of this election right now is about anti- establishment, about tapping into that anti-Washington anger? And is Donald Trump walking a fine line right now between making deals -- he says he's a dealmaker -- and being an outsider?

[17:50:03] GLORIA BORGER, CNN CHIEF POLITICAL ANALYST: Right. Is he a member of the establishment as Ted Cruz would have you believe? Or is he really an outside insurgent as Donald Trump would have you believe?

I mean, I think that's the big question that voters have to struggle with right now, particularly in Iowa and New Hampshire. Voters are looking for outside candidates. There is no doubt about it. When you look at all the elected officials, the governors, et cetera, et cetera, the longtime serving politicians, they're not the ones at the top of the polls right now. Cruz, first-time senator. Trump, complete outsider. For a while, Carson was up there.

And I think now what you see with Donald Trump is fascinating because the establishment believes that the devil you don't know is kind of a little better than the devil you know. And they don't like Ted Cruz, and they believe that Donald Trump is a dealmaker as you put out. He's a negotiator. They consider him to be a little bit more malleable so suddenly the establishment, which doesn't really like Donald Trump, is saying, OK, he's the lesser of two evils.

BLITZER: Yes. I guess that's a good point, Ron. If this is a two- man race, at least right now, Trump and Cruz, could any of those so- called establishment Republican contenders gain traction at any point in the near future?

RON BROWNSTEIN, CNN SENIOR POLITICAL ANALYST: Well, I mean, that really is the challenge. Right? So what we continue to see is this muddle in the middle of the fragmentation of the center right lane with no one getting anywhere near the consolidation and neither truly match or contend with Cruz or Trump.

You know, I was struck, as we're talking about before, if you look at Donald Trump's numbers, both nationally, Iowa and New Hampshire, remarkable consistency. He's at about 40 percent among non-college Republicans. Really an incredible number and a few this big. But only about 30 percent or a little below usually among college Republicans.

The problem is, that is the vote that is especially divided. That's where you would expect a Jeb Bush or a Marco Rubio or a John Kasich or Chris Christie to find their base and their footing to really get into this race. But it has remained fragmented.

And, Wolf, it's unclear whether Iowa is going to provide enough of a signal to New Hampshire, which is where that place -- where those voters usually consolidate. So it could remain fragmented after that, in which case Trump and Cruz will be the main choice.

BLITZER: David, Trump told me you heard in the interview, he thinks he can win New York, Pennsylvania, West Virginia, Virginia, he went on and on. Michigan he said, Ohio. You really believe that? Do you think that's realistic?

DAVID SWERDLICK, ASSISTANT EDITOR, THE WASHINGTON POST: Well, I'm not going to make any predictions right here that he's going to run the table. But if you're talking about the Republican primaries, I don't see any state that is out of Trump's reach.

I have to go back, Wolf, I wasn't sure if you were referring to the primaries or the general. In the primaries, yes, he could win all those states. In the general election, I think the sledding will be a little tougher for him, in a state like New York, even though it's his home state, because it's typically a liberal state, Pennsylvania tends to be a swing state, but West Virginia, yes, absolutely. West Virginia, remember, even in the Democratic primary, went heavily against President Obama last time. Trump defies a lot of the traditional logic on these state-by-state contests.

(CROSSTALK)

BLITZER: Yes --

BORGER: You know, Wolf --

BLITZER: Hold on a second, Gloria, because what Trump was clearly talking about in a general election, if he's the Republican nominee, he says he could win New York, Pennsylvania, New Jersey, these kinds of states. So, Gloria, go ahead.

BORGER: Well, you know, look, he has a benefit here in the -- in the Republican primaries as well as the general election which is that the anger is not only directed by Republicans against the Democrats. It's also directed against the Republicans and the Republican establishment. So when you look at Donald Trump, he kind of takes it all in that way because he's against both. He's against Barack Obama and Hillary Clinton. He's also against the Republican establishment whom he believes has messed everything up in this country.

So -- and so I think he gives people -- a large number of people a reason to vote for him and perhaps that's why they're not going for candidates like a Bush or a Kasich who are more establishment, but because these voters are mad at the establishment.

BLITZER: Ron Brownstein, if Trump does win Iowa a week from tonight, that's a huge deal. How important would that be for Donald Trump?

BROWNSTEIN: It would be huge because it would prevent Ted Cruz from consolidating evangelical Christians which has been the traditional path in the last few elections. The winner of Iowa then consolidates the evangelical Christians. And that's their base. If Trump wins Iowa, it shows two things. First, that he is preventing that from happening and we are seeing in polls that he's having strength. His blue-collar strength extends across the religious boundary to include evangelicals.

The second thing it would show would be is that his voters are -- the low propensity voters are turning out because it's harder to turn out in a caucus than a primary. If he can turn them out here, you know, the New York, New York, he can kind of turn them out anywhere. And that would be an ominous sign for the rest of the field.

[17:55:02] BLITZER: All right. Guys, stand by. We have a lot more to discuss. Also coming up, much more from my one-on-one interview with Donald Trump. Will he show up for this week's final Republican debate before the Iowa caucuses?

(BEGIN VIDEO CLIP)

TRUMP: I'm not a fan of Megyn Kelly. I don't like her. She probably doesn't like me, and that's OK.

(END VIDEO CLIP)

(COMMERCIAL BREAK)

BLITZER: Happening now. CNN town hall. Bernie Sanders and Hillary Clinton seeking an edge in their increasingly tight race. It's a high stakes showdown you'll see only on CNN. We'll get a preview from moderator Chris Cuomo.

Debate drama. Donald Trump tells me on a one-on-one interview that the next GOP debate may happen without him.

(BEGIN VIDEO CLIP)

BLITZER: When you say probably, you haven't 100 percent decided you will be --

TRUMP: No. Not 100 percent.

BLITZER: Why not?

TRUMP: I have to say, not 100 percent. I'll see. But I think I'm going to be treated unfairly, I'd do something else.