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THE SITUATION ROOM

Trump Promotes Hotel Opening; Interview With California Congressman Adam Schiff; Poll: Clinton's Lead Shrinks to 3 Points; Fighting ISIS; Intel Chief: Stopping North Korea Nukes a 'Lost Cause'. Aired 6-7p ET

Aired October 26, 2016 - 18:00   ET

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


[18:00:03]

WOLF BLITZER, CNN ANCHOR: Will he live up to his claim that he will ultimately spend $100 million or more?

Big bills. New details on the mega-millions earned by Bill Clinton in the latest batch of stolen e-mails published by WikiLeaks. Are the Clintons' assets a political liability against the billionaire Republican?

And boxing in Baghdadi. U.S. military leaders reveal new urgency to go after ISIS in its self-declared capital. Where is the group's leader? Is he believed to hiding right there? Could a coalition offensive be timed to prevent a new terror attack?

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.

BLITZER: Breaking tonight in the presidential race, Donald Trump is predicting a tremendous victory as he appears to be gaining ground in a must-win battleground.

Just 13 days before the election, a new poll shows Trump edging two points ahead in Florida as he battles against Hillary Clinton's advantage across much of the electoral map. Trump tells CNN he's prepared to put more money of his own into the campaign in the coming days. He refused to say exactly how much, he claims he will have spent $100 million by Election Day.

Trump detouring from the campaign trail earlier today to promote his new hotel here in Washington. Hillary Clinton, meanwhile, is warning supporters in Florida they can't take their foot off the gas in the final push to November 8.

CNN's new poll of polls shows Clinton now leads Trump by seven points nationwide. That's a slight downtick from a few days ago.

Also tonight, Defense Secretary Ash Carter reveals a coalition offensive to oust ISIS from its self-proclaimed capital in Syria that will likely begin, he says, within weeks. The terror group's top commanders, including its leader, Abu Bakr al-Baghdadi, are believed to be hiding there.

This hour, I will talk with Congressman Adam Schiff. He's a Hillary Clinton supporter and the top Democrat on the House Intelligence Committee. And our correspondents and analysts, they are also standing by as we cover all the news that is breaking right now.

But, up first, let's go to our senior White House correspondent, Jim Acosta.

Jim, you're there in North Carolina. Trump is about to hold a second rally in that state after his detour here in D.C. What is the latest?

JIM ACOSTA, CNN SENIOR WHITE HOUSE CORRESPONDENT: That's right, Wolf.

And Donald Trump is pushing back on the notion that he squandered valuable campaign time by attending that ribbon-cutting of his new hotel in Washington. He says he will do for the country what he's done for those hotels.

(BEGIN VIDEOTAPE)

ACOSTA (voice-over): The Trump campaign insisted this wasn't a political event, but as Donald Trump cut the ribbon on a new hotel in Washington surrounded by his top campaign aides, he also carved out some time to give a shout-out to Newt Gingrich, a top surrogate.

DONALD TRUMP (R), PRESIDENTIAL CANDIDATE: By the way, congratulations, Newt, on last night. That was an amazing interview. We don't play games, Newt, right? We don't play games.

(APPLAUSE)

ACOSTA: Trump was talking about this interview on FOX News, where Gingrich bitterly clashed with host Megyn Kelly, who was pressing the former speaker on the accusations of sexual misconduct hounding the GOP nominee.

NEWT GINGRICH (R), FORMER SPEAKER OF THE HOUSE: You are fascinated with sex, and you don't care about public policy.

MEGYN KELLY, FOX NEWS: Me, really?

GINGRICH: That's what I get out of watching you tonight.

KELLY: You know what, Mr. Speaker, I am not fascinated by sex, but I am fascinated by the protection of women and understanding what we're getting in the Oval Office.

GINGRICH: OK.

KELLY: And I think the American voters would like to know...

GINGRICH: And, therefore, we are going to send Bill Clinton back to the East Wing, because, after all, you are worried about sexual predators. ACOSTA: The interview was an instant reminder of Trump's own run-ins

with Kelly, which led to this moment cited time and again as an example of his problems attracting women voters.

TRUMP: Blood coming out of her wherever.

My theme today is five words, under budget and ahead of schedule. We don't hear those words too often in government, but you will.

ACOSTA: Trump is pointing to his glitzy new hotel to show voters what he can do for the country. He has repeatedly used his properties as campaign backdrops from Florida to Scotland.

TRUMP: This is what I want to do for our country, and this is what we're working so hard to do. Right now, just about everything our government touches is broken or they break it. It's always over budget, behind schedule, and simply nothing works.

ACOSTA: But his hotels, like his rallies, draw their share of protesters. Trump's daughter Ivanka, who was the ribbon-cutting with her brothers, argues the critics just don't understand her father.

IVANKA TRUMP, DAUGHTER OF DONALD TRUMP: I'll tell you, one of the most telling signs of his success over decades is the thousands of people who have worked with him, worked for him, fought with him and who continue to stand by his side in their quest to achieve great things.

[18:05:10]

ACOSTA: And Trump, in an interview with CNN's Dana Bash, rejected the notion that this stop was a waste of precious campaign time.

TRUMP: I did yesterday eight stops and three major speeches. And I have been doing this for weeks straight. I left here -- I left there for an hour-and-a-half. I'm going to North Carolina right now. Then I'm going to Florida. I'm going up to New Hampshire.

For you to ask me that question is actually very insulting, because Hillary Clinton does one stop and then she goes home and sleeps. And yet will ask me that question.

(END VIDEOTAPE)

ACOSTA: And Donald Trump has stepped on his campaign message for the second time today.

Just a few moments ago at a speech here in Charlotte on his policy proposals to help the inner cities, Trump took a swipe at Hillary Clinton and, yes, even Jeb Bush in defending that detour to that new hotel in Washington. Here's what he had to say.

(BEGIN VIDEO CLIP)

TRUMP: Honestly, she has less energy than Jeb Bush.

(CHEERING AND APPLAUSE)

TRUMP: I mean it. I mean it. And the reason I bring him up, he didn't sign the pledge, so he's open game.

(END VIDEO CLIP)

ACOSTA: And, Wolf, you could hear the crowd cheering. It never ceases to amaze even at this stage in the campaign to a Republican cheer as Donald Trump slams Jeb Bush.

It's happened time and again during the course of this campaign, Wolf.

BLITZER: Yes, Jeb Bush did sign the pledge, but he's not living up to the pledge to support the Republican nominee. And that's why Donald Trump obviously is angry and he's willing to go after the fellow Republican at this late stage in Florida, where Jeb Bush at one point was a pretty popular governor down there. Very interesting.

Jim Acosta, thanks very much for that.

I want to bring our viewers now more of CNN's new interview with Donald Trump.

Our chief political correspondent, Dana Bash, as you saw, spoke with him today at the ribbon-cutting ceremony at the new hotel.

Dana, you pressed Donald Trump on his personal financial commitment to really help his campaign in these final days.

DANA BASH, CNN CHIEF POLITICAL CORRESPONDENT: That's right, because especially now, as we are getting closer, the polls, some of them at least, are showing that it is tightening.

And victory could be within reach, and he has a big bank account. He could write a check to help push that along, particularly when it comes to television ads, where Republicans I talked to say that they feel that they are at a deficit there. Let's listen to what he said.

(BEGIN VIDEO CLIP)

TRUMP: Let me just tell you that we have -- I have over $100 million in the campaign. Hillary Clinton has nothing in the campaign. She's all special interests and donors. And they give her money. And then she will do whatever they tell her to do.

But I will have over $100 million in the campaign. And I'm prepared to go much more than that.

Now, here's the question. New polls are coming out. We're leading Florida. We're doing great in North Carolina. We're doing great in Pennsylvania. We're doing great all over. We're doing really well in New Hampshire. Ohio, as you know, and Iowa are doing fantastically well.

I'm telling you, CNN doesn't say it, but I think we're going to win.

BASH: So, but to do that, you have a pretty big bank account.

TRUMP: I do.

BASH: You can -- and time is running out. The clock is ticking.

TRUMP: OK.

BASH: Will you write a check and...

TRUMP: I have already done it. I have already written a number of them.

BASH: But, I mean, specifically, specifically to get up on the air to combat the ads that you say Hillary Clinton is running against you?

TRUMP: She's got -- well, in Florida, she has 50-1 against me, 50. You were the one that reported that.

BASH: But you have to means to combat that.

(CROSSTALK)

TRUMP: Sure, I do.

But, in the meantime, 50-1, and I'm leading. How would you like to have spent -- in the old days, you would get credit. If you would spend less money and have victory, that would be a good thing. Today, they want you to spend money.

I will have over $100 million. I'm willing to spend much more than that if I have to.

BASH: Can you just be specific? How much are you willing to put down in order to put up new ads?

TRUMP: I will have over $100 million in. I'm willing to invest more than that.

BASH: Like how much?

TRUMP: Dana, don't -- just let's go through the next question, Dana.

BASH: OK.

Well, my last question, because I am getting the hook over here, is, in the speech here, you talked about the fact that this is the second best piece of real estate on Pennsylvania Avenue. In 14 days, are you hoping that you are going to be spending after that more time here or down the street?

TRUMP: Well, look, I just hope that -- I built a great company. This is truly a great company. We have some of the great assets of the world, not only in our country, but in other countries.

And I predicted Brexit. You were one of the people that asked me about Brexit. And I said it's going to happen. And I'm not even saying this is Brexit, but I think the result is going to be the same, if not more so.

We are going to have, I think, a tremendous victory. People don't want four more years of Obama. They don't want Hillary with all of the corruption and all of problems.

And you see all of these WikiLeaks coming out and they're a disaster. And when you see John Podesta, who I think is terrible way he speaks about her, but that she has bad instincts, John Podesta saying that the person he works for has bad instincts.

I think it's terrible, but so many other things even worse than that are out about their honesty and their dishonesty. I really think that we're going to have a tremendous victory. And you know what? If I didn't think that, I wouldn't say it. I would say, well, we're going to be fighting hard.

[18:10:08]

Now, we will be fighting hard, but I believe we're winning. I actually think we're winning. I don't even think it's a question of we're going to try and win.

You start looking at the polls, what's happening, and, more importantly, start looking at all the people going to vote and sending in their ballots. We're way ahead in virtually every state, every area. And I think we're going to have a great victory.

(END VIDEO CLIP)

BASH: Now, Wolf, you heard him say that he's got $100 million in his campaign.

The FEC latest report shows $56 million. So, if that were to mean -- and that was over a month ago -- it would mean that he would have had to put over $40 million over the last month or at least until Election Day.

We will see if that happens. Regardless, why are we talking about this? Because, just for one example, I was hold that Reince Priebus, the RNC chair, went to Donald Trump in the last month and said, please, can you write a check, can you give more money, specifically for television ads in battleground states, where Hillary Clinton is up and her super PACs are up spending money and hitting him very, very hard?

And Republicans who do think that it is potential -- it is possible to win, that they would have a much better chance if he could fight back in paid advertising, and that did not happen at the time. It is still possible. He still could buy TV ad time. It would be a little bit more expensive for him now, at the end of the road, but it is possible.

And, again, Republicans I have talked to say that they really think it could help.

BLITZER: If he put in another $40 million or so. Let's see if he does.

BASH: Or anything.

BLITZER: Yes. All right. We will see. He's got the money. See if he wants to spend it.

All right, Dana, good work. Thanks very much.

BASH: Thank you.

BLITZER: There's breaking news we're getting into THE SITUATION ROOM right now.

A just released national poll shows Hillary Clinton's lead shrinking to only three points. There you see it right there. This is the FOX News poll, Hillary Clinton 44 percent, Donald Trump 41 percent, 7 percent for Gary Johnson, 3 percent for Jill Stein.

By the way, last week in the FOX poll, Donald Trump was down by six points, seven points the week before. In our most recent CNN poll, Donald Trump was down by five points.

In the last hour, I spoke to Trump national security adviser Pete Hoekstra, the former congressman. I want to get a view from the Democratic side.

A Hillary Clinton supporter right now, Congressman Adam Schiff of California, is joining us.

It looks like some of the momentum now, at least in these national polls, is moving towards Donald Trump, Congressman. How worried are you?

REP. ADAM SCHIFF (D), CALIFORNIA: I don't think the momentum has changed.

I think it is still in Secretary Clinton's favor. But I do you see an inevitable tightening of polls as you get close to Election Day. I think that is something that we can anticipate. It's why the Clinton campaign feels it needs to keep its foot on the accelerator and urge people that they need to get out and vote and they need to get out and vote early if they can, if that's allowed in their states.

And nothing can be taken for granted, because you do see a tightening of polls towards the end of most presidential campaigns, and I think that's what we're seeing here.

BLITZER: In Florida, it's totally shrunk. Take a look at this. This is the new Bloomberg poll right now, 45 percent, Trump is ahead, 43 percent for Hillary Clinton.

And now within the past few minutes, NBC News and "The Wall Street Journal"/Marist came out in Nevada. Take a look at this one, in Nevada, Hillary Clinton 43 percent, Donald Trump 43 percent. Why is her lead shrinking in these key battleground states and nationally? SCHIFF: I don't think it's owed to any particular issue. I do think,

as I mentioned, that you tend to see this coming together of the polls, the narrowing of the gap in most presidential races.

But what I'm encouraged by, Wolf, is when you look at Florida and you look at Nevada and you look at who is voting early, it's predominantly Democrats who are voting early. They're voting in stronger numbers than when President Obama ran. That is very encouraging.

So those indicators tend to mean more to me, frankly, than the narrowing of the polls at this stage. It's all about the ground game now. And I think the Clinton campaign has a much stronger than the Trump campaign. So I'm still feeling very optimistic.

But, at the same time, we can't take anything for granted. I do think there is one risk. That is that there may be people polled who don't want to admit they're supporting Donald Trump. So, for that reason, I take even more optimistic polls with a certain grain of salt and know that we can't let up in the campaign at all.

BLITZER: Are you concerned about all the damaging leaks from WikiLeaks that are hurting Hillary Clinton right now, that that could be a reason why there's been this narrowing of her lead in some of these key battleground states and nationally?

SCHIFF: My paramount concern over the leaks, frankly, has not been the impact on the campaign, which I think has really become part of the background noise, because they have been so frequent, so constant, so overwhelming, but rather the broader issue that you have a foreign adversarial power that is stealing these e-mails and publishing them in the United States with an attempt to affect the outcome of our election.

[18:15:12]

That, to me, is a breathtaking escalation by Russia of its cyber- meddling in the United States. And, as the ranking member on the Intelligence Committee, that is my paramount concern, not the political impact. It's certainly not helpful to the Clinton campaign. It's not designed to be helpful.

It's designed to be helpful to Donald Trump. But what ought to concern Americans first and foremost is that you have a foreign power that is trying to manipulate them and manipulate their opinion in this very ham-handed way.

BLITZER: Do you think the spike in Obamacare premiums could hurt her, especially in a place let's say like Arizona, which has emerged as a battleground state?

Prices there are going to -- premiums are going to go up for people on Obamacare by more than 100 percent. And that's a state potentially she could win. But look at that, 116 percent increase in Obamacare premiums in Arizona.

SCHIFF: I think it demonstrates that there are fixes that need to be made in the Affordable Care Act.

And one of the frustrations we have had in Congress is that you have one party devoted to the repeal of the Affordable Care Act, which I think privately they will acknowledge isn't going anywhere, but until they're willing to publicly acknowledge that and work with us to fix some of the elements of the Affordable Care Act, you're going to continue to see problems.

And I'm hoping that, when we have a new Congress and it will be a different Congress, that there will be a greater willingness to confront some of these issues to further control costs, to further increase competition within the exchanges. These are real issues that need to be addressed.

But I think that the public opinion on the Affordable Care Act has been remarkably static over the last couple of years. We don't see a dramatic change. And while this is not good news, I think, for consumers, I don't think it's likely to affect the political outcome in one way or the other.

BLITZER: We have other news coming into THE SITUATION ROOM.

Congressman, I'm going to have you stand by. The director of national intelligence, James Clapper, he says that trying to get North Korea denuclearize its military is probably a lost cause.

We will update our viewers on that and a whole lot more when we come back.

(COMMERCIAL BREAK)

[18:21:37]

BLITZER: We're back with Congressman Adam Schiff of California. He's the top Democrat on the House Intelligence Committee.

And we're following the breaking news and a new poll showing Donald Trump leading Hillary Clinton in the critically important battleground state of Florida.

But, first, let's get the latest from CNN's Phil Mattingly.

Phil, Clinton is making an all-out push for Florida right now.

PHIL MATTINGLY, CNN CORRESPONDENT: Yes, there's no question about it, Wolf.

Look, the reality is this. The 29 electoral votes this state holds can break the back of Donald Trump's campaign, if Hillary Clinton's able to win them on November 8. But it's clearly very close right now, more so than the Clinton campaign even thought over the course of the last couple of weeks. That means Hillary Clinton has gone all-in.

(BEGIN VIDEOTAPE)

HILLARY CLINTON (D), PRESIDENTIAL CANDIDATE: Florida can make the difference.

MATTINGLY (voice-over): With new polling which could suggest a tightening race in Florida, Hillary Clinton is taking nothing for granted.

CLINTON: I am going to work as hard as I can over these next 13 days, reaching out to as many people as possible.

MATTINGLY: The Democratic nominee spending her second straight day in a state that could all but guarantee the White House, warning again complacency.

CLINTON: We can't take our foot off the gas, even for a short time.

MATTINGLY: And throwing more jabs Donald Trump's way.

CLINTON: Listening to Donald Trump's campaign, I truly doubt that he has ever read the Constitution. Or if he did back in school, he certainly doesn't remember it, and he doesn't understand it is the most important founding document for the longest-lasting, greatest democracy in the history of the world.

(CHEERING AND APPLAUSE)

MATTINGLY: Her attacks, including a dig, Trump's detour from his campaign schedule today to attend a ribbon-cutting ceremony for his new hotel in Washington, D.C.

CLINTON: While the hotel may be new, it's the same old story. He relied on undocumented workers to make his project cheaper. And most of the products in the rooms were made overseas, and he even sued to get his taxes lowered.

MATTINGLY: Clinton punctuating her two events in the state with two new ads, one narrated by Democratic go-to Morgan Freeman.

MORGAN FREEMAN, ACTOR: Our children are looking to us. What example will we set? What kind of country will we be?

MATTINGLY: As her team continues to press state Democrats to vote early and give her campaign a crucial leg up come Election Day.

The latest data from Catalyst provided exclusively to CNN showing more than seven million votes have already been cast, including more than 4.6 million in battleground states, numbers that underscore the importance of the moment, one where Clinton maintains a comfortable national lead, according to the latest CNN poll of polls.

This all coming on Clinton's 69th birthday, a moment celebrated with a surprise cake before heading straight back onto the trail.

But now a new headache for the Clinton campaign in the latest WikiLeaks release of hacked e-mails. Clinton's former spokesperson Philippe Reines acknowledging the mess her private e-mail server created, saying -- quote -- "There is just no good answer."

[18:25:00]

A new memo revealed from WikiLeaks also shows how Bill Clinton's closest aide, Doug Band, helped the former president earn millions of dollars. The 2011 memo claims -- quote -- "Since 2001, President Clinton's business arrangements have yielded more than $30 million for him personally," Band writes, "with $66 million to be paid out over the next nine years."

(END VIDEOTAPE)

MATTINGLY: And, Wolf, when you look at those e-mails, obviously they're hacked and obviously the Clinton campaign refuses to acknowledge their authenticity.

However, they fit perfectly into the narratives we have heard Donald Trump hitting over and over again on the campaign trail in the last couple of weeks. It's something that the Clinton advisers could cause the race to tighten, not just here in Florida, but nationally.

That's something they're expecting, and that is exactly why Hillary Clinton has been repeatedly warning over the last 48 hours don't get complacent, this race is far from over -- Wolf.

BLITZER: Yes, looks like those polls are narrowing in some of those key battleground states, as well as nationally as well.

All right, thanks very much, Phil Mattingly, reporting for us.

We're back with Adam Schiff, the congressman from California, the ranking Democrat on the Intelligence Committee.

Very quickly on the stolen memo by WikiLeaks, details we just heard Bill Clinton could make upwards of $66 million in paid speeches, other business ventures, if you will. Doesn't that play into that narrative that the Clintons were engaging in what his critics call that pay to play?

SCHIFF: No, I don't think it does. What we're talking about there, as far as I can tell, and, again, I just had the glimpse that you showed, is money that he was going to make speaking around the country.

That doesn't connote any kind of a promise of the former president to do something, or the secretary of state. But, certainly, the Trump campaign will use it, as it has used these other Russian hacks to its advantage quite gleefully.

But I don't think that's going to change the dynamic of the race. I do have to say this thing, Wolf, because it never ceases to amaze me, that from that clip you just showed, here we are less than two weeks out, and Donald Trump cannot help himself but to still be pushing his hotels.

And you can only imagine that, as president, this would continue. He would use that office to trumpet his business interests around the country. And given that we don't know a lot of what those may be in Russia and other places, that's a frightening prospect.

BLITZER: His aide, his longtime aide, Doug Band, in these stolen WikiLeaks e-mails from John Podesta, said they were going to raise more funds for the Clinton Foundation through a private consulting group.

"Through our efforts," he writes, "we have brought new donors to the foundation and garnered increased giving from existing donors."

Is there anything awkward there from your perspective?

SCHIFF: Well, from my perspective, that Bill Clinton would be involved in raising money for the foundation isn't surprising and isn't condemnatory in any way.

The key issue is, was there some action taken by the State Department while Secretary Clinton was there that was influenced by people who were contributing tot foundation? And much as people have looked in the opposition research and among the media, there have never been any indications that the State Department took some action it shouldn't have taken to benefit a donor.

And that's the key question. So I don't really see any direct or critical implication by the fact that the author of the foundation, the former president, was raising money for the foundation. You would expect him to do that.

BLITZER: Let's talk about Iraq and Syria for a moment. Defense Secretary Ash Carter said today it will be, in his words, a matter of weeks before the U.S. and its allies can move against ISIS in Raqqa, its so-called caliphate capital.

Do you think that's realistic?

SCHIFF: Well, I was struck when I heard the secretary say that. That is a very aggressive schedule, because the Defense Department is also saying they're still in the process of identifying who the Arab forces would be that would be involved in the taking back of Raqqa.

The Kurds, they acknowledged, are not the right fighting force to go into Raqqa. They can help secure and place a stranglehold in some of the villages around Raqqa, but that seems like a very aggressive timetable. And it concerns me a bit, because we saw this play out once before when there was an ambitious schedule for taking Mosul, which initially was going to happen last spring.

So, I understand the incentive to move quickly, as people are fleeing, ISIS people are fleeing Mosul and moving to Raqqa and people are plotting and planning in Raqqa. But I don't think you can leave that military effort before it's ready, and there's a lot of work I think that still needs to go into preparing those forces.

BLITZER: And there's a lot of work to liberate Mosul right now. That mission is far from complete.

As you also know, James Clapper, the director of the National Intelligence Agency, called the U.S. efforts to try to get North Korea to give up its nuclear weapons -- and I'm quoting him now -- "probably a lost cause."

Do you agree?

SCHIFF: I don't.

And I was surprised to see the director say that. I have great respect for Director Clapper. I think he's a real straight shooter. But this is not the policy of the administration. It's certainly not my view either. I don't think that we can, in any way, suggest that the North Koreans, that their position on nuclear weapons is somehow inevitable and unchangeable. That, I think, would pose a real danger not only on the peninsula and to our allies, but it sends the message to other potential proliferators that, if you stick to your nuclear guns long enough, the rest of the world will just come to accept it.

So I don't think that's the right view. I don't think that's the right policy. And I think we need to put pressure, frankly, on China, maybe through the use of secondary sanctions, where we sanction financial institutions, including Chinese banks that continue to finance transactions with North Korea.

But also we make it clear to China that, if they don't play a more forceful role in constraining their client state, that we're going to have to increase our military and naval presence in the region; we're going to have to strengthen our missile defenses there, things the Chinese don't want to see but we will need to do to protect ourselves and our allies.

BLITZER: As you know, Congressman, there was a massive cyber-attack against the United States last Friday that took down huge parts of the Internet. Do you know who was behind it?

SCHIFF: I don't know who was behind it. It doesn't look in character the same as the other attacks we've seen recently that the Russians have been behind. That's not to say there can't be a Russian link, but it's not the same motivation. Obviously, this is not designed to interfere or meddle in our elections. It has a very different motivation, I would think.

And therefore, it may have very different actors involved. But at this point, I don't think we have a definitive conclusion about who's responsible or why.

BLITZER: The Pentagon announced today that it was halting efforts to recover what are called the reenlistment bonuses that they say were erroneously awarded to about 17,000 or so members of the California National Guard to reenlist, go serve, go to fight in Iraq, Afghanistan, elsewhere. You represent California. Why did this happen to begin with?

This sounds like an outrage, that they went to these men and women who reenlisted, volunteered for service in the U.S. military, and all of a sudden they're told, "You can't have the bonuses. You have to return all the money with interest. In the meantime, if you can't, your credit rating is going to suffer." This sounds so outrageous.

SCHIFF: It is outrageous. It's really quite unimaginable. And the closest I can think of, of any other example is when we learned that they were charging recovering soldiers, Marines, airmen and others at Walter Reed Hospital for the food they were eating while they were recuperating. It's, I think, equally outrageous, and we have to put a stop to them. I'm glad to see the Pentagon issue a statement calling for a halt.

But we have to go beyond that. Anyone who has repaid these bonuses ought to be reimbursed completely, along with interest, in my view. We ought to forgive any of these debts.

What happened here is you apparently had people who were recruiting managers that were offering incentives that they weren't authorized to offer. One has already gone to jail for that.

But it looks like a broader problem than just California. It looks like other states were also implemented -- or implicated, and so there's a systemic issue here that I think we ought to have oversight hearings on.

But first and foremost, when we come back into session, I'd like to see a provision in the defense bill, retiring these debts. If there's reason to believe that a particular soldier was knowingly involved in a fraud, that's one thing. But to tar all the service members who did their duty I think is unconscionable.

BLITZER: It certainly is. And they've got to find a way to make sure that their credit ratings don't suffer, because a lot of these young men and women who did reenlist, they've had trouble getting loans, because they couldn't repay the government with interest for what they thought were bonuses to reenlist in the military.

It is outrageous. You've got to learn, Congressman, what happened here and fix it so it doesn't happen again. Thanks very much for joining us.

SCHIFF: Absolutely.

BLITZER: Just ahead, the battle for Florida. Is Trump gaining momentum in that must-win state? And could it change the trajectory of the presidential race?

(COMMERCIAL BREAK)

[18:38:53] BLITZER: We're standing by to hear from Donald Trump. He's about to hold a campaign rally in North Carolina.

Also tonight, a new national poll shows that he now trails Hillary Clinton by just three points. Let's bring in our political experts.

Gloria, let me start with you. This new FOX just poll out, Hillary Clinton 44 percent, Donald Trump 41 percent. Just three points. Last week in the same poll, he was down by what, six points, the week before seven points. Seems to be narrowing it a bit. GLORIA BORGER, CNN CHIEF POLITICAL ANALYST: Seems to be narrowing,

which is why we have to kind of look at our averages, the poll of polls.

What's surprising to me about this, to a degree, at a margin of somewhere between two to five points, maybe more in some polls. What's our average now? Is it about seven?

DAVID CHALIAN, CNN POLITICAL DIRECTOR: Six. She's plus six in our new poll.

BORGER: Six? Two to six? Let me say a handful of points difference. And so this one is a lot closer than their previous polls, certainly than "The Washington Post"/ABC poll was, which had her up considerably, even in -- even in double digits.

So I think you're going see these fluctuations as people decide, and as the news changes every day.

[18:40:06] BLITZER: But probably even more worrisome than the narrowing on the national poll level, look at this Bloomberg poll in Florida, David Chalian. Florida likely voters, choice for president, Trump 45 percent, Hillary Clinton 43 percent. Two-point lead, within the margin of error...

CHALIAN: Yes.

BLITZER: But that's very encouraging to Donald Trump and his supporters.

CHALIAN: Without a doubt. That's some of the best news they've had in quite some time. And Donald Trump was touting it today to Dana Bash. In fact, he told another interview that he thought they were up even more than that.

And that is why, before Hillary Clinton even finished her two-day swing through Florida, she'd already indicated that she'll be back there this weekend. You know, Florida is going to be one of those competitive states all the way through to November 8.

BLITZER: And don't forget: Marco Rubio is running in Florida, and he's doing well. He may be running ahead of Trump, but the question is, will Republicans who are voting for Rubio also vote for Donald Trump? And does that help Donald Trump in the state of Florida? In this race, sometimes down ballot can help up ballot.

BLITZER: David Swerdlick, Trump today, when he was here in Washington, he touted the long lines of people waiting for his rallies, which is true. He gets huge numbers of people at his rallies. He said, "We're way ahead in virtually every state, every area." That's not necessarily true, though, not way ahead. A little bit ahead in Florida but not way ahead. But he says that -- he says that Trump is -- he predicts it's going to be a Brexit type of surprise; he's going to be elected president.

DAVID SWERDLICK, ASSISTANT EDITOR, "THE WASHINGTON POST": Yes, so they're definitely not way ahead, and long lines and big rallies are not the metric, but that Florida -- that Bloomberg Florida poll is -- has got to be startling. Good news for Trump, bad news for Clinton.

I mean, Florida has 29 electoral votes. If they somehow string together Florida with 29, Ohio with 18, New Hampshire -- the Monmouth poll shows that it's getting tighter. All of a sudden Trump goes from Romney's 206 electoral votes to 257. That's not going to win it, but that's in the ball game.

BLITZER: Based on everything you're hearing, Rebecca, early voting, there's a lot of it going on right now. Who's ahead? Because the Trump people insist they are way ahead.

REBECCA BERG, CNN POLITICAL ANALYST: Well, so far we're seeing Democrats ahead in many places. What we tend to see from Democrats are Democrats show up early to polling places to vote, and Republicans tend to vote absentee early. So just a difference in the way the parties tend to treat voting and difference between their traditions. Republicans like to show up on election day.

But it really helps Democrats if they can accumulate this advantage going into election day, especially if the race is tightening, to already have those votes in their pocket, that's really important. And we should remember, as we're talking about these polls, that as many as a third of people might have already voted in this election.

CHALIAN: Twenty-five percent of the votes, if turnout is similar to 2012, about 25 percent of the votes already banked. More than 2 million people have voted so far.

BERG: Exactly. And so as Donald Trump is trying to come back and close this margin with Hillary Clinton, that's something really big to consider.

BLITZER: All right. Everybody stay with us. Stand by. We have much more coming up. Top Clinton aides privately expressing concern over her private e-mail server. There are new revelations tonight from those stolen campaign e-mails.

(COMMERCIAL BREAK)

[18:47:56] BLITZER: The breaking news this hour. A new national poll shows Hillary Clinton's lead over Donald Trump shrinking to just three points nationwide. There you see it, 44 percent to 41 percent.

Gloria, take a look at Nevada right now. As important as the national polls are, the battleground states even more important. This is the new NBC/Wall Street Journal/Marist poll In Nevada, likely voters, Hillary Clinton 43 percent, Donald Trump 43 percent. Gary Johnson, 10 percent.

It doesn't get much closer than that.

BORGER: No. And you look at that Gary Johnson number, where he's outperforming what he is nationally. And I think that clearly is of some concern to Hillary Clinton. Obama won the state by six points last time. And I think you're going to see them put a lot of heat into that state. A Republican Senate candidate is up seven points in that state according to the same poll, Joe Heck.

So I think that Democrats, Hillary Clinton, this is a state she wants to keep on her side of the ledger. And it's blue.

BERG: It's also worth noting that Nevada is a notoriously difficult state to poll. You have a high proportion of Spanish speaking households. Harry Reid in his 2010 race was essentially tied with Sharron Angle going into that and ended up winning by a number of points. So, just worth noting.

BLITZER: But the basic message, David, and you study these polls all the time. Right now, the Democrats, Hillary Clinton supporters start to get nervous in these final 13 days. It comes at a time that the Clinton campaign had signaled to big donors, you know what? Give the money to some of these Senate races where it's very competitive. We're doing just fine.

CHALIAN: Right. Although talking to some Clinton folks today, they don't think this is the most terrible to have this notion out there that things are tightening and that it may be getting closer because you heard Hillary Clinton warn to her supporters today, don't be complacent. She said that out in Florida. It's a concern of the concern. So a little bit of concern is not necessarily a terrible thing.

But remember, Wolf, as you are talking about each of these states, you've go to remember the big picture.

[18:50:03] Donald Trump can win every Romney state, plus Nevada, Florida, Ohio, Iowa, and North Carolina and he still doesn't get to 270 electoral votes. So, he still needs to dig in to some territory that's already leaning Hillary Clinton's way.

BLITZER: David Swerdlick, how much of a problem is it for the Hillary Clinton, all of these e-mails that have been stolen by WikiLeaks and reveal a lot of the information pretty embarrassing to Hillary Clinton and her top aides going into these final 13 days.

SWERDLICK: It is embarrassing. I don't know how much damage it can do poll-wise or in terms of the vote on Election Day, only because Donald Trump has run out of time to drive home the message. He's run out of debates. He'll never get another debate chance to sort of charge her with this face to face.

But in the sense that it hurts her making her closing argument, it is embarrassing and it does reflect that probably Republicans are going to keep after this even if she wins the White House. This is not going to go away.

BORGER: If there were any other candidate that she were running against, I think that candidate would have taken more advantage of this opportunity, because this is a gift. All of these emails are gift. Say what you want about them, it plays into an existing negative narrative about Hillary Clinton. And if Donald Trump could stay on that message and could drive that

home, I think it would -- I think it would really help him. The problem is that he gets on that message and then he shifts to talk about himself.

BLITZER: The other problem that the Clinton campaign has, these premium spikes in the Affordable Care Act. And Obamacare coming at this sensitive moment in a state like Arizona, where the premiums are going to go up more than a 100 percent and it's close race there. That's a problem.

BERG: Sure. And it creates this sense of uncertainty for the Clinton campaign too. You would like to be in control of the message going into Election Day. And to suddenly have this wrench thrown in to the discussion complicates things a little bit. Hillary Clinton has certain points she wants to be hitting leading up to Election Day. She's trying to make her closing argument right now and to have to try to reassure voters on this poor issue, especially an issue that makes a lot of independents and Republicans very nervous is going to be difficult.

BLITZER: Certainly is.

All right, guys. Everybody, stay with us. We've got more news coming in.

Also, a new phase of a major military offensive against ISIS taking on the terrorists in their self-proclaimed capital. We have new details on the looming battle.

(COMMERCIAL BREAK)

[18:56:52] BLITZER: The United States says the fight to kick ISIS out of Iraq is only the beginning. The next target, the self-proclaimed ISIS capital in Syria.

Our Pentagon correspondent Barbara Starr is working the story for us.

Barbara, I take it this next offensive is looming?

BARBARA STARR, CNN PENTAGON CORRESPONDENT: It is looming indeed, Wolf. Tonight, there is a new urgency to open up the fight, to get Raqqah back and maybe, just maybe get to ISIS' top leader.

(BEGIN VIDEOTAPE)

STARR (voice-over): The top U.S. military commander now sounding an alarm about Raqqah -- a city of nearly a quarter million where the top ISIS commanders have long been thought to be hiding.

LT. GEN. STEPHEN TOWNSEND, COMMANDER, COMBINED JOINT TASK FORCE: There is an imperative to get isolation in place around Raqqah, because our intelligence feeds tell us that there is a significant external operations attacks planning going on emanating centralized in Raqqah.

STARR: How urgent is it?

TOWNSEND: We think it is very important to get isolation in place around Raqqah to start controlling that environment, on a pretty short timeline.

STARR: This as the fight for Mosul in Iraq goes on -- emotional scenes of families being reunited.

Defense Secretary Ash Carter says this second front in Raqqah will begin very soon.

ASHTON CARTER, DEFENSE SECRETARY: I think it will be within weeks. That's what I want to say.

STARR: From earlier fighting in northern Syria, the U.S. already has intelligence on ISIS planning against the U.S. in France, Townsend says. The concern here in Raqqah, the target and timing of ISIS's next attack is not clear.

TOWNSEND: We know they are up to something. And it's an external plot. We don't know exactly where. We don't know exactly when. But we're going to try to head it off.

STARR: But in this densely populated city, finding plotters and those who may already have sent operatives overseas will be tough.

The secretive Joint Special Operations Command including Navy SEALs and Army Delta force is now in charge of stopping ISIS plotters. And U.S. troops will continue training and advising local forces earmarked for the Raqqah fight. But a huge hurdle, getting enough Kurdish and Arab fighters to get Raqqah back and hold on to it.

(END VIDEOTAPE)

STARR: By any measure, the fight for Raqqah will deadly and difficult. But the U.S. is making it clear. It wants to get this a part of the war going against ISIS before ISIS plotters inside Raqqah have any of their plots take hold in the West -- Wolf.

BLITZER: The U.S. role, mostly air power, is that right?

STARR: Well, there will be air power, but actually, there will be a number of U.S. Special Operations Forces continuing to be on the ground in northern Syria, working as trainers and advisors for the local forces -- Wolf.

BLITZER: All right. Barbara Starr at the Pentagon, we'll watch this together with you. That's it for me. Thanks very much for watching.

I'm Wolf Blitzer in THE SITUATION ROOM.

"ERIN BURNETT OUTFRONT" starts right now.