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The Situation Room
Iraq on the Brink; Port Delay Deal
Aired February 24, 2006 - 19:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
WOLF BLITZER, CNN HOST: Thanks very much, Lou. And to our viewers, you're now in THE SITUATION ROOM, where new pictures and information are arriving all the time.
Standing by, CNN reporters across the United States and around the world, to bring you the day's top stories.
Happening now, Iraq on the brink. A new holy site is attacked and that's even with a curfew in place. It's 3:00 am in Baghdad. We'll have the latest on the violence that's been threatening to unleash a civil war.
Also this hour, the port deal delay. Some Democrats and Republicans simply aren't buying it. It's 7:00 pm here in Washington where the storm over port security is still swirling. CNN's Lou Dobbs goes head to head with a member of Congress.
And a major oil refinery attacked and fears that others could follow. We'll take a closer look at the threat right now to oil production and oil prices. Guess what. It could already be costing you.
I'm Wolf Blitzer. You're in THE SITUATION ROOM.
First this hour, a developing story. Iraq now under curfew and trying to crack down on violence with tensions high after several days of blood spilled. As Saturday dawns in Baghdad, most people will be kept off the streets for a second day in hopes of preventing any new attacks on the religious shrines.
But new violence today has brought worries of an unending uprising. Gunmen fired two rockets late Friday in a village southeast of Baghdad near a tomb revered by Shiites. One rocket reportedly hit a gate of the tomb, and one exploded a few yards away. That attack follows this week's bombing of another Shiite shrine, the Golden Mosque. Its destruction unleashed a wave of violence that has left nearly 130 people dead and prompted fears of civil war.
Joining us now from Baghdad, our correspondent, Aneesh Raman. Aneesh, what's the significance of yet another holy religious shrine being attacked today?
ANEESH RAMAN, CNN CORRESPONDENT: Well, Wolf, this tomb in Salman Pak southeast of Baghdad has significance to both Shia and Sunni. The attack, as far as we understand, two mortars fired upon the tomb. The extent of the damage is unknown and no casualties at this time. But Salman Pak is a heavily Sunni town. We understand for Iraqi officials that the Mehdi Militia, the armed militia loyal to radical Shia cleric Muqtada Sadr had gone into Salman Pak today, surrounded the main Sunni mosque there, refusing to allow worshipers in.
We understand now they are still there, the Mehdi militia in an extremely tense stand-off. So at the moment in that specific location we're seeing a standoff between the Mehdi Militia and the Sunnis that are there. This attack, though, will undoubtedly just exacerbate the situation that's already at hand, increased tensions on the ground, Wolf.
BLITZER: So despite the fact there's been this curfew in effect that's presumably going to continue, the situation at least in the short term seems to be deteriorating.
RAMAN: It has. The curfew is essentially putting things on hold in the streets in terms of demonstrations and large scale violence that could come about. The curfew now put in place again, this extraordinary measure of a daytime curfew for Saturday by the Iraqi government.
Meantime, politically, we know they're battling among themselves to try to and figure out the best way to handle this situation, to reign in the violence. They know that if they let up on these curfews, it could just lead to huge protests and further attacks.
That said, today, despite the curfew, 26 bodies were found. It's unclear when they were killed, part of the string of attacks since Wednesday morning's attack on the Shia mosque that have killed at least 130 people so far, Wolf.
BLITZER: Aneesh Raman in Baghdad, thanks very much.
And President Bush is calling this a moment of choosing for the Iraq people. He says he believes they will choose to avoid civil war. The U.S. military said today it would carry out additional security patrols for another 48 hours. Let's turn to our Pentagon correspondent, Barbara Starr. Barbara?
BARBARA STARR, CNN CORRESPONDENT: Wolf, the curfew is keeping parts of Iraq calm. But what will happen when it's finally lifted?
(BEGIN VIDEOTAPE)
STARR (voice-over): In Baghdad's Sadr City, many took to the streets, defying the government imposed curfew. In cities across the country, in Basra and in Najaf, more demonstrations amid continuing reports of attacks against Sunni mosques in retaliation for the Wednesday attack on the Golden Dome Mosque in Samarra.
General George Casey, who commands 136,000 U.S. troops in Iraq, will watch carefully through the weekend to see how Iraqi security forces meet their most crucial challenge yet.
GEORGE W. BUSH, U.S. PRESIDENT: General Casey reports that they're doing a fine job of enforcing curfew and working to restore order and calm. We can expect the days, coming days will be intense. Iraq remains a serious situation.
STARR: The Pentagon has worried for months that the questionable loyalty of Iraq's police forces could make this very type of sectarian violence difficult to control. In a report Friday to Congress, the Pentagon noted many serving police officers, particularly in the south, have ties to Shia militias.
U.S. troops are increasing their joint patrols with Iraqi units, especially in Baghdad, but are trying to ensure Iraqi forces continue to take the lead.
COL. JEFFREY SNOW, U.S. ARMY: We have parceled our forces throughout our areas of responsibilities to respond. In the event they need assistance.
(END VIDEOTAPE)
STARR: U.S. commanders say the test now is not just to restore security, but to see if Sunni and Shia Iraqis return to the process of selecting a new national unity government and move past this crisis. Wolf?
BLITZER: Barbara Starr, thanks very much. We're going to have more on Iraq coming up. But let's move now to the ongoing storm over port security in this country.
Tonight, the head of the former 9/11 commission is warning that the quicker the Bush administration can get out of the port deal, the better. It's been less than 24 hours since the United Arab Emirates firm agreed to postpone its takeover over six U.S. ports and critics of the deal still are raising serious red flags about security.
Once again here is our national -- national correspondent, John Roberts. He is here in THE SITUATION ROOM. John?
JOHN ROBERTS, CNN CORRESPONDENT: Need a program to keep them all straight. Thanks, Wolf.
Late today Senator Susan Collins, chair of the Homeland Security Committee became the latest Republican to sign on to legislation to stop the ports deal dead in its track saying the White House has just missed the boat on this issue and if nothing changes, that legislation will be introduced in Congress on Tuesday morning.
(BEGIN VIDEOTAPE)
ROBERTS (voice-over): The White House had hoped a slow down of the ports deal would be just the political relief it needed. Not a chance.
SEN. CHARLES SCHUMER, (D) NY: Well, a cooling off period simply doesn't do the job.
ROBERTS: In fact, rather than calming the waters, the delay only stirred even members of the president's own party to make sure that during this pause the White House undertakes a thorough security review of Dubai Ports World.
UNIDENTIFIED MALE: If there's nothing to hide, why not investigate? Again, if you're applying for a job at the federal government, you would get a full investigation and a full vetting. To me, the same principle should apply to a company coming out of a country which has had very strong al Qaeda connections in the past.
ROBERTS: The White House is having none it of it. The deal is done, say officials and will not be reopened. The most they'll do during the delay is attempt to convince members of Congress that national security concerns have been addressed.
JOHN SNOW, U.S. TREASURY SECRETARY: It will give the administration and give D.P. World an opportunity to better inform Congress and the public about this transaction.
ROBERTS: And if the White House holds to that position, says Congressman Peter King, there's going to be a problem.
REP. PETER KING, (R) NY: I lost too many constituents on September 11th to ever make the mistake again of trusting without verifying.
(END VIDEOTAPE)
ROBERTS: And late today we've got an updated statement from D.P. World, executive vice president Michael Moore saying, "We're making ourselves available to people in the administration, on Capitol Hill, Democrats and Republicans, anyone who wants to talk to us. We think the more people learn about the security record and reputation of D.P. World, the more comfortable they will be that the U.S. is being made more secure, not less, as this moves forward."
But Wolf, there's an awful lot of people not too far from here on Capitol Hill who have raised serious questions about that statement.
BLITZER: We're going to watch every step of the way. Thanks, John, very much. And stay tuned to CNN day and night for the most reliable news about your security.
Mary snow is joining us now for a closer look at other news making headlines right now. Mary?
MARY SNOW, CNN CORRESPONDENT: Well, Wolf, South Dakota's legislature today approved a measure banning all abortions except when the woman's life is at stake. The state's governor says he will likely sign it into law and it appears to be a direct legal assault on Roe v. Wade and will likely end up before the Supreme Court.
Under the measure, doctors could get up to five years in prison for performing illegal abortions. Planned Parenthood is promising to sue.
The army has charged seven members of an elite army unit with engaging with sex for money on an Internet porn site. The charges stem from an investigation that soldiers from the celebrated 82nd Airborne Division based at Ft. Bragg, North Carolina, had appeared on a gay porn Web site. Three of the soldiers face a court martial while four others face lesser proceedings.
And an update on that New York drum maker who was diagnosed with anthrax earlier this week, Mayor Michael Bloomberg says the man's life is in danger. Authorities think the bacteria was on animal skins the man used to make drums. Seven of the people who may have been exposed have been given antibiotics as a precaution.
And a federal judge surprised the parties in the patent suit over Blackberry wireless devices by not handing down a ruling handed down today. The judge has been asked to shut down Blackberry services and award $126 million in damages to a Virginia company that claims its patent had been violated. But the judge says he needs more time to consider the arguments and gave no indication of when he would rule. Wolf?
BLITZER: Mary Snow reporting. Mary, thanks very much. Let's go to Jack Cafferty in New York for the "Cafferty File." Jack?
JACK CAFFERTY, CNN ANCHOR: Wolf, President Bush urging Iraqis to stay on the path of democracy. He said although he expects the coming days to be "intense," his word, he's optimistic. Optimistic about what?
A hundred and thirty people have been killed in the last three days. The Iraqi government has slapped on curfews and people who know about such things suggest that Iraq is very close to the brink of all- out civil war. Secretary of State Condoleezza Rice said other Arab states are worried the violence will spill over into their countries. So here is the question. Does democracy have a chance in Iraq? Email us at caffertyfile@cnn.com or go to cnn.com/caffertyfile. Wolf?
BLITZER: Thanks, Jack, very much.
Coming up, a festive mood in Mardi Gras in New Orleans. Partygoers trying to have fun amid obvious signs that all is not well.
And over in Saudi Arabia, a bold would-be suicide bombing, attackers targeting an oil facility. But officials say they were stopped.
And the Dubai port deal is firing up positions pro and con. CNN's Lou Dobbs will take on a Republican congressman, Darrell Issa of California in a one on one debate right here in THE SITUATION ROOM.
(COMMERCIAL BREAK)
BLITZER: In our "Strategy Session" today, gunmen fire two rockets at a sacred Shiite tomb just south of Baghdad. After a week of violence, will the country be able to come together and avoid civil war? Joining us now, CNN political analyst and Democratic strategist Paul Begala and Terry Jeffrey, the editor of "Human Events." Terry, is Iraq falling apart right now?
TERRY JEFFREY, "HUMAN EVENTS": Well, I certainly hope not, Wolf. But I think actually these attacks on these Shia shrines could be attributed to a potential success of the Bush strategy. The Bush strategy - right now the ambassador there is pushing as hard as he can to get Shias to bring Sunnis into the government, try and get enough power handed over to the Sunnis so they feel comfortable with the political process.
Zarqawi who is the head of al Qaeda in Iraq has quite literally declared sectarian war against the Shias. He is trying to keep these Sunnis in the insurgency mode. I think this is his biggest gambit yet to do it. If we can get past this crisis, maybe we can form a government that does bring stability to Iraq.
BLITZER: A U.S. general, Brigadier General Mark Kimmitt, senior policy and planning officer for the U.S. Military Central Command says, "This isn't a bump in the road, it's a pothole and we'll find out if the shock absorbers in the Iraqi society will hold or whether this will crack the frame.
PAUL BEGALA, DEMOCRATIC STRATEGIST: So far, the frame is cracking. I deeply disagree with Terry's interpretation that somehow it's good news that we have rampant sectarian violence and a 1200- year-old mosque was burnt to the ground. This is not what we were promised. As a political matter, here is the president's problem. It's credibility. The sound bite you played in our last segment, the president saying, I am optimistic about Iraq. I think he's got the calibration wrong. You don't want to be pessimistic but he needs to be realistic. And when he says stuff like that, he sounds foolish, on the worst week perhaps ...
BLITZER: So what should be the strategy for Democrats, the Joe Lieberman strategy, hold tight and finish the job as best you can or the John Murtha strategy which is basically a phased withdrawal?
BEGALA: Those are policy distinctions that serious policy people are going to draw. I don't have the solution to Iraq. I had the solution, which was don't invade. OK. They should have listened to me. Now they're in the soup. There's no good solution. But what I am saying, politically, the president's credibility is crumbling. There are other pro-war Republicans, John McCain and Newt Gingrich who are still very popular. The president is not. The majority of the country thinks the president is no longer honest. Why? Because he says moronic things like I'm optimistic when a hundred people are slaughtered in the streets.
JEFFREY: There's another hopeful sign in Iraq today that people should know about. Abdel Aziz al Hakim, who is the head of the Supreme Council for the Islamic Revolution in Iraq.
BLITZER: He's one of the Shiite leaders.
JEFFREY: Right, they are actually one of the two parties that won the election, and he's one of the most influential Shia in the country and Ayatollah Sistani, who in fact is the most influential Shia in the country, they are both saying this violence is not justified, telling the Shia to cool it. They're staying onboard a peaceful political process. You can't afford to lose them, obviously, but it's hopeful even in this time of crisis they're pushing for peaceful politics, not war.
BLITZER: Here is another excerpt from the president's speech today. Listen to this.
(BEGIN VIDEO CLIP)
BUSH: By building free institutions and an inclusive society that provides minority rights, Iraqi leaders will bring the nation together. And this will help to defeat the terrorists. And the Saddamists who are fighting Iraq's democratic progress.
(END VIDEO CLIP)
BLITZER: It's a complicated political issue.
BEGALA: He's clueless.
BLITZER: Now, almost three years into the war. Next month, three years since the U.S.-led invasion. For Democrats to come up with a unified strategy at this clearly delicate moment ...
BEGALA: They don't need one. They're heading into congressional elections. They can do enough by saying we'll ask tough questions. We won't be a rubber stamp.
BLITZER: But you know the Democrats are going to be asked what do you think the president should do?
BEGALA: Well, 100 different things because they have 100 different positions because they're actually thinking this through. I don't think that's the problem. I think the problem is the president from the beginning said we'll be greeted as liberators. He said just recently - the vice president a few months ago said this is the last throes of the insurgency. Today he said it's nonsense about how great everything is. The president is no longer credible about Iraq, he is not a credible leader on national security. And it is going to croak his party politically.
BLITZER: Is it going to croak the Republican Party?
JEFFREY: I do not think it is. Look, this is a problem for the United States of America. We need to solve it. We need bipartisan support for a policy that will work. I think the president has put in place a policy that can work and I think our enemies over there see that it can work. And right now they're trying to precipitate that civil war.
We all have an interest in making sure it doesn't happen. I think what we're actually doing on the ground today is the best possible strategy. If the Democrats have a good alternative, they should put it on the table. They need to be for this country now, not for their partisan interests.
BEGALA: Of course we're for the country. The president needs - you know what he needs to do? He needs to read. I know he doesn't like to. He should read Winston Churchill. Churchill led his country through a difficult war, much of which they were losing and didn't give us this Howdy Doody happy horse manure.
He needs to be Winston Churchill, not Bobby McFerrin. Remember that song in the '80s, "Don't Worry Be Happy"?
BLITZER: Paul and Terry, thanks very much.
And still to come here in THE SITUATION ROOM, Lou Dobbs versus a member of the United States Congress. They're going to spar over the deal to hand over control of six U.S. ports to a Middle Eastern country.
And who may be responsible for an attempted attack on rich Saudi oil target? All that ahead right here in THE SITUATION ROOM.
(COMMERCIAL BREAK)
BLITZER: Let's go back to New York with Mary Snow standing by with a quick look at other news making headlines around the world. Mary?
SNOW: Wolf, Venezuela has banned two U.S. airlines from serving the country and restricted a third. Aviation officials in Caracas say they've taken the steps in retaliation for a U.S. ban on Venezuelan air carriers that's been in effect for 10 years. The restrictions will go into effect March 1st. Flights by Continental and Delta Airlines to Venezuela will be canceled and American Airlines which makes seven trips a day to the country will have that number reduced to three.
Officials in the Philippines have called off the search for survivors of the mudslide that engulfed a whole village last week. Nearly 1,000 people are still missing, 139 bodies have been uncovered. Emergency crews are expected to now focus their efforts on helping evacuees who lost their homes in the disaster.
In Pakistan, angry clerics are increasingly using protests over cartoons depicting the Prophet Mohammed as platforms to criticize President Pervez Musharraf. Thousands of Pakistanis defied bans on rallies in the capital today, joining in another day of protests across the country. Musharraf has particularly been criticized for his close relations with the U.S. President Bush is scheduled to visit Pakistan early next month.
And British police have recovered at least some of the cash of what's being called the largest currency heist in the country's history. Police are combing through a white van where the cash was discovered, they are looking for forensic evidence. Three people have been detained for questioning. The thieves made off with up to $88 million in British currency from a cash depot on Wednesday. No word yet on how much money was found in that van today. Wolf?
BLITZER: Mary, thanks very much.
Just ahead, there's a story we're following now out of the Middle East. We're learning who may have been responsible for today's terrorist attack on that oil production facility in Saudi Arabia. And the stakes could be enormous for all of us. We'll take a quick break. We'll be right back.
(COMMERCIAL BREAK)
BLITZER: There's now apparently a claim of responsibility for that terrorist attack against that Saudi oil facility earlier today. An attack that was thwarted. Our senior Arab affairs analyst, Octavia Nasr, is looking into this. What are we picking up, Octavia?
OCTAVIA NASR, CNN ANALYST: Well, Wolf, there's a claim of responsibility that was posted just a few minutes ago on a Web site that usually carries claims of responsibilities from al Qaeda group. This is coming from a group that calls itself al Qaeda in the Arabian peninsula, which is the name for al Qaeda in Saudi Arabia. They're saying that a group under the name of the Sheikh Osama bin Laden League has carried out the attack against the oil facilities in Abqaiq and they do give some details, they say that two suicide bombers drove cars into the facilities. They don't go beyond that, but they certainly say that this is a part of a bigger plan to attack the crusaders and stop them from stealing the wealth and the oil of the Muslims in their land.
BLITZER: Octavia, hold on a second. Peter Bergen is our terrorism analyst. Peter, what do you make of this development?
PETER BERGEN, CNN ANALYST: Well, you know, bin Laden has constantly harped on the theme that the West is stealing they oil resources and not paying enough. And in fact, in December of 2004 he issued an important statement calling for attacks both in Iraq and in the Gulf, calling on members of al Qaeda to attack these oil facilities, describing this as a golden opportunity.
So, in the past when bin Laden has called for certain actions, al Qaeda and its affiliates have acted upon those calls. And I think this could be one of those cases.
BLITZER: When that attack occurred earlier today, there was an immediate spike in the price of a barrel of oil, the oil markets getting very jittery. Ali Velshi was looking into that story throughout this day. Ali, give our viewers a sense of what's at stake, if, in fact, there is some sort of serious attack against any Saudi facility.
ALI VELSHI, CNN CORRESPONDENT: Well, it's a bit of a sad statement that there are all sorts of attacks all the time on civilian structures and they don't seem to get the world's attention the way a single attack on an oil facility might. Oil spiked over two dollars a barrel today, taking it almost to $60 a barrel because Saudi oil facilities are supposed to be very secure. Not only that, this particular facility is responsible for processing in some measure almost two-thirds of the oil output of Saudi Arabia, which has the world's biggest proven oil reserve.
So it is possibly the world's most important single oil site. And Saudi Arabia has a collection of the world's most important oil sites, so when that happened immediately because oil is in tight supply you saw a spike in the price of oil. And even though it settled back a bit, that is the biggest jump we've seen in oil prices in over a month.
BLITZER: Let me bring back Peter Bergen.
Peter, Osama bin Laden himself a Saudi. It's no secret they would love to disrupt the oil markets, attack the economic heart of the Saudi kingdom. I assume security around all of Saudi oil facilities must be enormous.
BERGEN: Indeed. And in fact, against all sorts of critical infrastructure, I was in the kingdom relatively recently. And, you know, anywhere where there are westerners in the residential compounds, these are like medium security jails, they are very hard to attack at this point.
And we've seen sort of a drop off in the attacks by al Qaeda in the past year or so. There were about 20 attacks in the post May 2003 period. Things have tapered off. I mean, if, indeed, this is al Qaeda, it's a sign that they are trying to show that they're still in business after suffering a series of losses.
They lost a lot of their important leadership. Something like 100 of them were killed. Eight hundred were detained. And so we actually haven't seen much in the kingdom in the last year or so in terms of these terrorist attacks.
BLITZER: Octavia, I assume this al Qaeda web site that the announcement, their claim of responsibility, was all done in Arabic. Is there anything specific in there you've been reading that you want to point out to our viewers?
NASR: Well, sure. It does sound and look very much like previous claims from al Qaeda in Saudi Arabia. And, of course, the mention of oil facilities and the encouragement to attack oil facilities is a recurring theme in most of the speeches by Osama bin Laden or his number two man, Ayman al Zawahiri. So the language sounds very familiar and very consistent with previous messages from the al Qaeda leaders and their followers.
The two things that jump at me are, one, not much details as usually you would expect from those claims. In previous claims, they would provide the names and the exact numbers of those that carried out the attack. And, of course, they called them martyrs, and they sort of glorified them and glorified the act.
Here, they kept that part simple. It could be because the suicide attack was foiled, that the attack was thwarted. It's very possible that happens, too, that they don't see this as a major victory, that their main plan was not carried out to its full extent.
You know, today on Arab media, Saudi media, especially, there was explanation to the fact that the reason why this attack was thwarted is that security that Peter was talking about. Apparently around the facility as large as this one, you have double police. You have the local police, the Saudi police on the outskirts, looking in. And inside there is the private police securing the area. So, in a way, we usually expect more details how the attack was planned and carried out and names and exact numbers. Here what they say is two men in two cars and that's that.
But today, for example, from the Saudi security, we learned that more people were killed, at least three. And there was talk about three cars. So, you know, that kind of stuff makes us, you know, expect more maybe, more details and also more explanations as to why not much information at this point.
BLITZER: Thank you, Octavia Nasr, our senior Arab affairs editor.
Ali Velshi before we wrap this up -- and we are going to be watching this story. The oil market is already jittery. Nigeria a major oil exporter. Serious problems there. Iran, there is a lot of tension with Iran. The serious instability, brink of civil war in Iraq.
Now an attack on a Saudi oil facility. Next week, I assume that those oil markets and other markets could be a little bit loose.
VELSHI: I want to remind you, Wolf, that there is a less than 500,000 barrel difference between the oil that gets produced every day in the world and the oil that gets consumed every day in the world. Saudi Arabia, Nigeria, Iran, these are all places that produce more than a 1 million barrels a day. In some cases, well more than million barrels a day.
So if anything goes off-line it is very, very difficult, and that's when the traders start getting involved. One of the analysts we spoke to today, Wolf, said something very interesting to me earlier. He said, the terrorists may have decided that it is easier to attack our lifeblood than our homes.
BLITZER: Ali Velshi, thanks very much.
Peter Bergen, thanks to you.
Octavia as well.
We are going to continue to follow this breaking story for our viewers. Much more coming up.
Also, more on the controversy here in the United States over the control of those six American ports. CNN's Lou Dobbs, as you know a vocal opponent of the ports deal with the United Arab Emirates, is going to face off against Republican Congressman Darrell Issa of California.
Stay with us here in THE SITUATION ROOM.
(COMMERCIAL BREAK)
BLITZER: Homeland Security Secretary Michael Chertoff is strongly denying that the United Arab Emirates essentially bought favor with the U.S. to help secure that controversial port deal. The UAE had donated $100 million more than any other country to help victims of Hurricane Katrina.
Chertoff says the money and the deal aren't connected in any way whatsoever. That deal is very, very controversial, despite a delay in the deal. It sparked outrage, angst and now this delay from Dubai Ports World.
And joining us now, Republican Congressman Darrell Issa of California and our own Lou Dobbs, the anchor of "LOU DOBBS TONIGHT."
Congressman, a lot of the critics of this Dubai Ports World deal -- a lot of the critics say it is simply not in America's best national security interest to let this United Arab Emirates country operate these ports in the United States. You have criticized them. You suggest this is simply prejudice, some sort of anti-Arab feeling. What do you mean by that?
REP. DARRELL ISSA (R), CALIFORNIA: Well, you know, Wolf, I think there is no question that the first reaction that we saw in the media was clearly based on a country of origin and a religion for that country. That was before the facts were out. That was before potential things to really look at that I think we should look at even emerged.
There is a question of whether the investigation was done according to the statute that was passed by Congress. And I think that that is worth looking at. But there's no question that people jumped out immediately, saying, my goodness, it's an Arab Muslim country, we can't have this.
The truth is that China already operates ports similarly. And that's the number one country of spying on us. We could make the same statement if France had one. Ten percent of French citizens are Muslims, and we saw them rioting in the street last summer.
So I think that we should look at the security issues clearly. But foreign ownership is already a foregone conclusion. There's a considerable amount of our ports that are already operated, just as these were, by overseas companies.
BLITZER: All right. Lou, is it a matter of prejudice against Arabs?
LOU DOBBS, CNN ANCHOR: It wasn't a matter of prejudice against the Chinese when Duncan Hunter, the chairman of the Armed Services Committee, succeeded in stopping the sale and lease of assets to Cosco (ph), the Chinese-owned company, in 1998 and '9, and this is not in this instance. This is straightforwardly an assessment of what is in the national security by the critics of this administration, who -- the congressman is saying it rather gently. In point of fact, this administration violated the law when it failed to honor the investigation requirement for a 45-day period following the initial review. There is no question about that.
The fact that the administration has chosen to ignore the law has nothing to do with the fact that it is in point blank, outright violation. And the issue of the president saying that there's no difference between the United Arab Emirates and Great Britain is an astonishing statement. The differences are overwhelming.
BLITZER: Let me get back to this issue of prejudice, because it comes up all of the time, Congressman Issa. You said the other day, if we succumb -- if we want to have Arab nations and Muslim nations be our allies on the war on terror, we can't succumb to xenophobia. But listen...
ISSA: Absolutely.
BLITZER: ... listen to what your Republican colleague, Peter King, said the other day. Listen to this.
(BEGIN VIDEO CLIP)
REP. PETER KING (R), NEW YORK: This has nothing to do with it being an Arab nation. It has to do with a country which has really -- has had unusually close ties to terrorism, and it's a risk we just can't take.
(END VIDEO CLIP)
ISSA: Well, I appreciate Peter's comments, and he's a thoughtful colleague, with the charge of homeland security as the chairman. So he takes that very seriously, and he should.
Where I would disagree with that kind of a statement is, look, we need to look at the company's operation. We need to look at its history. We need to look at how it's been operating. We need to make individual decisions, and of course, we need to look at whether or not government officials -- now or in the future -- have real sway over the day-to-day operations and security.
All of that is fair to do. But, Wolf, it's fair to do if this were a French company, France being a country with a huge Islamic population, some of whom might be fundamentalists, some of whom might invade or seep into a company's operations. It's not about the country of origin, and that's where Peter and I disagree. It's not the label, it's the detail beneath it.
BLITZER: All right, Lou, go ahead.
DOBBS: Yes, Congressman, I would just disagree on a couple of points. One, for any U.S. intelligence agency, for any U.S. government agency or department or organization, in the case of CFIUS, to ignore the cultural, religious context of the company -- the country that owns the company that would be acquiring a U.S. strategic infrastructure asset is crazy.
Secondly, you -- you're very vocal on the issues of border security in this country.
ISSA: Absolutely. DOBBS: You're vocal on the issues of immigration reform and stopping illegal immigration. My guess is you've been called a racist by many of those open border advocates. Have you not? You know what it feels like.
ISSA: Touche.
DOBBS: For people to introduce the idea that the national security of this country is a racial consideration or a religious consideration mask the very important issues that are emerging here.
One, is this administration going to insist that the national interest be put ahead of commercial interest? Is it going to insist that our government be effective in preserving and establishing, in the case of the ports, port security and enforcing our borders?
BLITZER: We're almost out of time. Go ahead, Congressman.
ISSA: Lou, I'm going to agree with you 99 percent here. I absolutely believe that we should have a higher level of scrutiny. There should be more scrutiny over this purchase and any others. But I would like the dialogue that people use, particularly in the media, those of us looking at the camera, we have to talk in terms of the company, the individuals, the security systems, the safeguards.
As soon as we go to a label like Muslim or an Arab term, we are falling into being called xenophobes, because it's not about being an Arab nation or being a Muslim. It's about the individuals and the systems. And I -- look, I have deep concerns, and I share them with you, particularly on our security of our borders, but we have to talk in terms of individual activity. That's all.
BLITZER: All right, 10 seconds, Lou. We're out of time. Go ahead.
DOBBS: The last word I would say on this -- and I think, Congressman, both you and Wolf will agree -- 6.5 million Muslims Americans are in this country. We have the most diverse society on the face of the earth. This country has more races and religions and ethnic groups living harmoniously and not homogeneously, but well in this country. And we have much to be proud of.
ISSA: Absolutely.
DOBBS: And when people introduce the race card, it is usually the last refuge of a person without argument for the position they've taken, and they are fearing for their agenda, not the welfare of the nation.
BLITZER: Lou Dobbs and Darrell Issa, a good discussion. Thanks to both of you for coming into THE SITUATION ROOM.
ISSA: Thank you. Thanks, Wolf.
BLITZER: And coming up, we're going to go live to the Gulf Coast as Mardi Gras celebrations get under way. As we speak, massive parades are taking place. We're going to take you straight to Bourbon Street.
Plus, our own Anderson Cooper has returned to the town in Mississippi where he witnessed the immediate aftermath of Katrina. He's going to show us what a difference six months can make -- or not. Stay with us.
(COMMERCIAL BREAK)
BLITZER: A serious showdown today over classified documents in the CIA leak case. The former Cheney Chief of Staff Lewis "Scooter" Libby insists the papers are crucial to his defense. He has pleaded not guilty to charges of lying in the investigation of the leak of a CIA operative's identity. Our Brian Todd is covering this story for us from the federal courthouse -- Brian.
BRIAN TODD, CNN CORRESPONDENT: Wolf, you hit it right on the head. The central battle in this case now is over those documents from sensitive intelligence briefings, and whether they might reveal a certain state of mind on the part of Lewis Libby that his attorneys hope might make their case.
(BEGIN VIDEOTAPE)
TODD (voice over): Lewis Scooter Libby walks briskly to a waiting car, as tight-lipped as his attorneys outside the courthouse, but inside Libby's attorney, Ted Wells was animated, pleading with Judge Reggie Walton to order the prosecutor to produce documents on presidential daily briefings, highly classified intelligence reports for the president that Libby observed between 2003 and 2004.
The defense claims those documents, along with some of Libby's notes the prosecution hasn't yet turned over, will prove that the vice president's former chief of staff was distracted by important matters of national security.
And that distraction might have affected what Libby told a grand jury and investigators looking into the leak of CIA officer Valerie Plame's identity.
MICHAEL ZELDIN, FORMER FEDERAL PROSECUTOR: There is a notion that Libby may defend himself by saying, I did not intentionally lie in the grand jury that my misstatements in the grand jury were that and that they were born of the fact that I have a very busy life, doing a lot of very important things and, you know, forgive me, but this was not high on my agenda. And therefore, I forgot it.
TODD: Prosecutor Patrick Fitzgerald countered that Libby had several very unusual meetings with reporters during the summer of 2003, showing, according to Fitzgerald, that Libby was focused on the Plame story.
(END VIDEOTAPE)
TODD: And Patrick Fitzgerald went on to say that it would be a terrible mistake that would derail this case if the documents were turned over. He said those documents would get into matters of sensitive national security information, but facts not relevant to whether Libby lied to a grand jury or not.
The judge said these are very weighty issues. He will rule on those documents in a couple of weeks -- Wolf.
BLITZER:: Brian Todd thanks very much.
Six months ago a storm named Katrina slammed into the Gulf Coast with deadly force. As chaos ensued, CNN's Anderson Cooper went to Waveland, Mississippi. Now six months later, he has returned. And Anderson is joining us now live.
Anderson, what have you found there?
ANDERSON COOPER, CNN ANCHOR: Wolf, I can tell you, it's pretty startling to return to Waveland nearly six months after the storm swept through here. So little really has changed. I mean, there are signs of progress. There's no doubt about it.
There are hundreds of volunteers religious, faith-based groups who have come down here to help, and they have made a big difference. There's been a massive response by the federal government as well.
But you walk around Waveland, and I mean, you see block after block, acre after acre of destruction. And tonight on "360" at 10:00, we are going to hear from the mayor of Waveland, who says really it's a tale of two Wavelands. There's the part of the city, which has been cleaned up by private contractors, contractors hired by the city. And they have cleaned up about 600,000 cubic yards of debris.
And then there's the part of Waveland, which has been cleaned up by the Army Corps of Engineers, by the federal government. And they've only cleaned up about half the amount of debris in the same amount of time.
So the question is why? Why that stark difference? We'll examine that tonight on tonight "360" -- Wolf.
BLITZER: We'll be watching Anderson.
Thank you very much.
Meanwhile, they're getting ready for a party in New Orleans not very far away from where Anderson is right now. That devastated city is celebrating Mardi Gras.
CNN's Chris Lawrence is joining us now with this part of the story.
Chris, how is it unfolding?
CHRIS LAWRENCE, CNN CORRESPONDENT: Well, Wolf, I can definitely understand what Anderson means when he's talking about a tale of two cities. We know there is incredible damage here in New Orleans, but when you take a look here on Bourbon Street it's almost like Hurricane Katrina never happened. There's just an incredible crowd starting to swell. And it's still fairly early in the night. Of course the Bourbon Street crowd, very touristy. This is one part of the Mardi Gras celebration.
The others are the parades, and that is where the local families really, really stake their claim to. You can take a look now. Some of the parades going on in different parts of the city. Lots of families out there. These are a lot of people who live in New Orleans, live in the area.
And the parades and the crews are a real part of their tradition. Some of them have said it was a real important point for them to put these parades on and to show the world that New Orleans is still alive.
You've got other people who say the money being spent here could have been better spent on the recovery -- Wolf.
BLITZER: Chris Lawrence, thanks very much.
We're going to have extensive coverage of the Mardi Gras in New Orleans over the next several days.
Let's find out what's coming up right at the top of the hour. Paula standing by.
Hi, Paula.
PAULA ZAHN, CNN ANCHOR: Hi, Wolf. Thanks so much.
The CNN investigation of the safety of the nation's most popular dog treat now that the owners have been hit with a class action lawsuit. We've learned tonight they are changing their labeling on their product.
Also, as we focus in on the Olympics, we'll hear from a former Olympian who says the pressure to excel is so intense she resorted to much more than practice and exercise and what she did could have killed her. Those stories and much more coming up just about six minutes from now -- Wolf.
BLITZER: Thanks very much Paula. "PAULA ZAHN NOW."
Still ahead, it's Jack's question of the hour. Does democracy have a chance in Iraq, given the rash of sectarian violence over the past few days? Jack Cafferty and your email coming up next.
(COMMERCIAL BREAK)
BLITZER: Getting some new information just coming into CNN right now about those trapped miners in New Mexico.
Mary Snow, what are you learning?
SNOW: Well, Wolf, rescue crews in Mexico are suspending their search for 65 trapped miners. They've been trapped since last Sunday. This search is now being suspended because of dangerous gas levels.
Over the past several days, search crews were able to advance deeper into that mine, this, of course, following a huge explosion in that mine last Sunday when 65 people became trapped -- Wolf.
BLITZER: We'll continue to watch this story for our viewers.
Mary, thank you very much.
Let's check in again with Jack in New York for "The Cafferty File" -- Jack.
JACK CAFFERTY, CNN CORRESPONDENT: Wolf, President Bush urging Iraqis to stay on the path of democracy, he says. Although he expects the coming days to be intense, he remains optimistic. The question is does democracy have a chance in that country?
Bill in Dickson, Tennessee, "Democracy always has a chance anywhere, but it must come from within. It cannot be rammed down anyone's throat from without."
Jeannie in Temecula, California, "Democracy in Iraq wasn't the real objective. Bush wanted to remove Saddam, period. If democracy came later, he could accept the glory."
Jack in Mountain Home, Arkansas, "Not as we know it. The religious and familial ties are too overpowering to have the kind of democracy we know. That's why dictators are so common there."
Skip writes from Dallas, "Of course democracy doesn't have a chance in Iraq. The only thing that kept it from a civil war before we invaded was Saddam, and now that he is in jail, there is nothing to stop the different factions from trying to destroy each other."
Wes in Columbus, Ohio, "Of course it does. But it will be very difficult to get there. It would help if the liberal media would stop falling for the insurgents' traps. Try to be more even-handed in your reporting and stop being duped by the enemies of democracy."
Have you ever been duped by an enemy of democracy?
Cal in New York writes, "Democracy is not even on the menu. The current situation is what Colin Powell meant when he said you break it you own it. The historical model is Yugoslavia, and the bloodshed there stopped only when the sectarian states were broken up, Kurdistan, Sunnistan, Shiistan. And we go home."
And I am going home -- Wolf.
BLITZER: Give us a 20 second preview of what is on your weekend show, "In the Money."
CAFFERTY: Well, we are going to talk a lot about oil and the attack on that big oil terminal in Saudi Arabia today. Tom Friedman, the Pulitzer Prize winning op-ed columnist for "The New York Times" joins us. We are going to have a discussion about that. We are also going to interview an international economist who thinks that the port deal is a great idea for America, and that's an interesting discussion as well. It's on Saturday at 1:00, Sunday 3:00 Eastern time. And we invite the people watching THE SITUATION ROOM to check it out.
BLITZER: Good show. Thanks very much. Have a great weekend, Jack.
CAFFERTY: You too.
BLITZER: Thanks very much.
And thanks to our viewers for joining us. I'll be back Sunday morning on "LATE EDITION." Among my guests, the national security adviser to the president, Stephen Hadley. "LATE EDITION" airs 11:00 Eastern, 8:00 a.m. Pacific. "LATE EDITION" the last word in Sunday talk.
I am Wolf Blitzer in THE SITUATION ROOM.
Let's head over to Paula Zahn in New York -- Paula.
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