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The Situation Room
FBI Sends Out Terror Alert Bulletin; Dubai Ports World Deal Fallout
Aired March 10, 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 ANCHOR: To our viewers, you're 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 tonight's top stories.
Happening now, it's 7:00 p.m. here in Washington. And we have a developing story we're watching. The FBI sending out a bulletin concerning possible terror attacks at sporting events.
How much damage could the Dubai ports debacle do to U.S. interest in the Arab world? President Bush is concerned, but should he also be more concerned about the political damage here at home?
And a significant new development tonight in the CIA leak case. A federal judge orders the government to hand over its most sensitive intelligence documents to lawyers for the indicted former vice presidential chief of staff Lewis "Scooter" Libby.
I'm Wolf Blitzer. You're in THE SITUATION ROOM.
Tonight we begin with a CNN security watch. A developing story on a possible, possible terror threat against sporting events right here in the United States. Let's go straight to our justice correspondent, Kelli Arena. Kelli, what are we learning?
KELLI ARENA, CNN CORRESPONDENT: Wolf, with the NCAA tournament season under way, the FBI is warning stadium operators that sporting events could be attractive targets for terrorists. In it's regular weekly bulletin, the FBI says there was an Internet posting on what they call an extremist Web site advocating attacks at sporting events.
According to the FBI, the web posting recommended hiding explosives under winter clothing and having one suicide bomber detonate a bomb inside a stadium while others set off bombs in the path of evacuating fans. The posting also suggest using blonde or black American suicide bombers.
Now, the FBI says there is no specific or credible information that any attack is planned and it says that there's no evidence the web site is linked to al Qaeda or any other terrorists organization. But officials say it is always prudent to pass on such information and urges stadium operators and local law enforcement to remain vigilant, Wolf.
BLITZER: All right. Kelli, thanks very much. Kelli Arena reporting.
So, how serious is this threat? Joining us now by phone is our CNN security analyst, Pat D'Amuro a former assistant director of the FBI in New York. Is this just covering their bases right now? Or is there more to this, Pat, based on what we know?
PAT D'AMURO, CNN SECURITY ANALYST (via telephone): Wolf, this is a routine communication that the FBI sends out weekly with intelligence and information that has been collected during the week that doesn't warrant an immediate dissemination because they believe there's validity to it. What they are saying is they are simply in receipt of information that they have learned that this information is on a web site, and they want to make sure that their law enforcement partners as well as stadium security officials are aware that this information is out there.
It states in the communication that this is not credible. There's no other credible information to indicate that an actual attack will take place.
BLITZER: Pat, we have a map of the United States on the screen that we're showing our viewers. These are the locations where the NCAA basketball tournament games, including the final four in Indianapolis are going to be played out over the next couple three weeks or so. I assume local, state, federal authorities will beef up security at these various venues at these stadiums as a result of this specific alert.
D'AMURO: Absolutely they would. They would have sufficient security to begin with, but you know again remember, the Internet may not have been specific to basketball games, but because of March Madness coming up, I'm sure the Bureau wanted to get this out there just to make sure they shared that intelligence.
BLITZER: Pat D'Amuro, thanks very much for that. And to our viewers, stay tuned to CNN day and night for the most reliable news about your security. We'll follow up on this story.
We'll move on now to some major consequences in the port deal collapse. For the first time since his defeat, President Bush goes public and expresses concern this setback could impact the war on terror.
Dana Bash is over at the White House. Is Congress ready for round two? The Hill took on the White House and won, at least for now. Ed Henry tells us why Congress may be tempted to do it again.
Is it payback time, though? Tonight, free trade talks between the UAE and the United States on hold, at least for now. Brian Todd sees if timing is connected to the port deal collapse.
And what of Dubai Ports World? Our Internet reporter Abbi Tatton explores whether the company is really committed to selling off its U.S. port operations.
Let's begin our coverage with Dana Bash over at the White House. Dana, I want to play for our viewers an excerpt of what the president said reacting to the collapse of this deal. Listen to this.
(BEGIN VIDEO CLIP)
GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: I'm concerned about a broader message this issue could send to our friends and allies around the world, particularly in the Middle East. In order to win the war on terror we have to strengthen our relationships and friendships with moderate Arab countries in the Middle East.
(END VIDEO CLIP)
BLITZER: Dana, the president wasn't even waiting for a question. He volunteered this statement going right into the meeting with the newspaper editors here.
DANA BASH, CNN WHITE HOUSE CORRESPONDENT: Look, the bottom line here, Wolf, is as we close this week this White House was desperate to close the dark chapter in the president's political time here in Washington. And they understood that the only way to do that was to have the president speak out on this, because we would all be waiting to hear the president talk.
What was interesting there is that the president essentially had took one last shot at the Republican rebels on the Hill saying that he believes that the move that they made really will hurt the relations between the United States and Arab world.
But in his way he also did concede defeat. He said, look, I still believe that this deal would not have hurt U.S. security, but clearly Congress opposed it. Behind the scenes here, senior officials are being unusually candid, a lot more contrite. They say look, the bottom line is we messed this up politically from the very beginning. We should have known about this. We should have gotten ahead on this. And they say that they are hoping to learn some lessons from it.
BLITZER: Dana, stand by. Ed Henry is on Capitol Hill watching all of this. Ed, listen to this other excerpt we heard from the president today.
(BEGIN VIDEO CLIP)
BUSH: My administration will continue to work with the Congress to provide a greater understanding of how these transactions are approved, in other words, the process. And how we can improve that process in the future.
(END VIDEO CLIP)
BLITZER: What are they saying up on the Hill as a result of this setback for the president, a setback that his fellow Republicans largely caused?
ED HENRY, CNN CONGRESSIONAL CORRESPONDENT: Well, we're hearing that a lot of Republicans making noise about keeping the heat on this White House, Republicans like Senator Richard Shelby, chairman of the Banking Committee. What the president was talking about there, was of course the CFIUS process, a bureaucratic process by which the deals are approved. Richard Shelby said he is going to dig in on that.
Much beyond that, a much bigger issue of course being Iraq as Dana has noted over and over, that's what the president is mostly concerned about with his legacy moving forward. And when you think about it, the pressure is only get hotter on the president in the next few months about whether or not there will be troop withdraws in Iraq, you know.
After the John Murtha a few months ago there was pressure and then it came off. And seeing Iraq getting closer to the possibility of a civil war, with Republicans on the ballot in November, you know, they have already laid the groundwork here by standing up to the president -- not on a domestic issue, but an issue involving the war on terror. They rejected his argument that UAE was a key ally in the war on terror. They are also going to be putting the heat on him, potentially on Iraq. It is something he has got to be quite concerned about in this election year, Wolf.
BLITZER: On that point, Dana, the Iraq issue hovering over this White House ominously, I think to put it mildly. How concerned are they over there that in the aftermath of the Dubai ports collapse, Iraq could collapse, as well if civil war breaks out?
BASH: Very. They're very concerned. And that is why you're going to see the president talking about this. They are going to step up. We're going to see another PR campaign from this White House.
Next week is the third anniversary of the beginning of the Iraq war. The White House is well aware of that. They are well aware of the stunning poll numbers that show that 70 percent of Americans believe that civil war is going happen there. So they really know that they have to get a handle on this issue. But they really are battling the bottom line which is what is happening on the ground and that's a very, very difficult thing to do politically to convince the people. Ed Henry was talking about that they shouldn't run away from the president on Iraq.
BLITZER: Brian Todd has been looking into the enormous complications, the ramifications of this collapse on trade, strategic relations. Brian, what you picking up?
BRIAN TODD, CNN CORRESPONDENT: Wolf, we're learning that a very valuable economic and military relationship could be in transformation tonight. The United States and the UAE have postponed high level free trade talks. And experts warn that the fallout from the ports deal fiasco could go further than that.
(BEGIN VIDEOTAPE)
TODD (voice-over): In these CNN exclusive pictures, rows of GM and Ford cars and trucks not in Detroit but in Dubai. Warehouses, cranes, containers from every corner of the world, a bus strapped to a container on a ship: Images of a power house of transshipment, tourism, trade.
The question now: will the U.S. continue to be major partner with the United Arab Emirates? At stake last year, $10 billion in trade, money that could balloon in both nations sign off on a free trade agreement.
Experts tell CNN the postponement of high level trade talks after the port deal collapse is not coincidence. Those involved in the negotiations don't make that link.
REEM AL-HASHIMY, UAE COMMERCIAL ATTACHE TO U.S.: That's just a minimum postponement. And we don't see it as in any way delaying the process.
ROB PORTMAN, U.S. TRADE REPRESENTATIVE: Because I think the issue really was more a question of security rather than investment or trade.
TODD: Here's another question of security in this relationship, CNN learned Emirates-based Inchcape Shipping Services landed a $50 million contract last year to provide fuel and food for U.S. Navy ships and sailors throughout the Middle East. As a result, this Arab company gets advance notice of U.S. vessels schedules.
We asked CNN security analyst Alec Fraser, who once commanded this Navy ship in the region, why it is acceptable for Arab companies to access American war ships, but not run U.S. commercial terminals?
CAPT. ALEC FRASER, U.S. NAVY (RET): Well, aside from the fact that the supplies are all being inspected which is a major difference over supplies coming into the United States, this almost impossible to supply bananas, oranges, meats, fuel, on a global basis from one central location. It has to be done locally.
TODD: A Navy official tells CNN there's never been a security problem with Inchcape Shipping, but says virtually all security for U.S. ships is handled by the Navy at those ports. An official with ISS tells us the company has undergone rigorous external security checks, and all of its port staff have had their backgrounds completely vetted -- Wolf.
BLITZER: Brian, thanks.
Abbi Tatton, there's still some lingering questions about this whole collapse. What are you picking up online?
ABBI TATTON, CNN INTERNET CORRESPONDENT: Wolf, left and right, people are still asking what are the details of this deal since this development yesterday. A lot of questions about this term U.S. entity. We've heard that U.S. operations at the Dubai Ports World deal are going to be transferred to a U.S. entity. But what does that mean? (INAUDIBLE) that that term is vague.
Well, we pressed Dubai Ports World for a statement on this today. And this is what they told us.
"We're talking to our advisers and the Treasury Department about the best ways to move forward." Leaving questions still, Wolf, about what is happening next. BLITZER: And they deliberately, apparently, want to leave it vague, at least for now. Abbi, thank you very much.
Brian, thanks to you. Thanks to all of our reporters. More on this story coming up later this hour.
Also coming up, party time in Tennessee. Top Republicans are testing the presidential waters right now. Will one of them leave Memphis with a leg up for 2008?
Plus, a new fight for Arnold Schwarzenegger. The first so-called cage fight held in California with the state's blessing. Mainly the governor bruised.
And a Muslim chaplain caught on tape and now under fire. Did he have fighting words for Jews and for President Bush? You're in THE SITUATION ROOM.
(COMMERCIAL BREAK)
BLITZER: An extraordinary development today in the CIA leak case. A federal judge here in Washington ordered the government to produce top secret documents that could help the defense of the vice president's former chief of staff, Lewis "Scooter" Libby. The documents are from the president's daily brief. Those are the most sensitive documents produced by the intelligence agencies of the U.S. government. The judge ordered the White House and the CIA to handover relative material involving Valerie Plame, the CIA officer whose identity was leaked to the news media.
The ruling sets the stage for a possible clash with the Bush administration over executive privilege, national security and the workings of the CIA.
We're joined now by our senior legal analyst Jeff Toobin who is going to help us better understand the significance.
How significant is this development, Jeff?
JEFFREY TOOBIN, CNN SENIOR LEGAL ANALYST: Well, it is certainly an important first step in this process. It could go in a couple different directions. But at one level it could be no big deal, it could also lead to this whole case being dismissed.
BLITZER: Because of what's called gray mail, right?
TOOBIN: Exactly.
BLITZER: Explain to our viewers what that is.
TOOBIN: What gray mail is, is a defendant who had access to classified information says to the judge, look, I can't defend myself fairly unless I can introduce in open court the following classified information.
The judge says, you know, you are right. It's not a fair trial unless you get this information.
The intelligence agencies say that's too sensitive, can't be released. So, the judge says, well, I have no choice but to dismiss the case.
That's a successful use of gray mail. That's a possibility here. We're a long way from that stage yet.
BLITZER: Well, some of the legal defense team for Scooter Libby have some specific personal experience with gray mail, don't they?
TOOBIN: That's right. The lawyer on Libby's team represented Oliver North where he very successfully used classified information to get rid of much of the case against him. I was on the other side. I was one of the prosecutors.
And this is one of the most time consuming, difficult processes. This is just the beginning. And Libby did win somewhat of a victory in getting access to these documents. But where the real controversy hits is not giving him access, because after all Libby has already seen these documents, it is no big deal to show it to him again, the real crunch comes is when a judge has to decide how much of it can be shown to the jury, because that is public, and that's when cases really can get dismissed. But we're a long way from that.
BLITZER: Jeff Toobin, thanks very much. We'll watching with you every step of the way.
Coming up here in THE SITUATION ROOM, a kickoff event in the very early presidential race. Top Republicans are in Memphis right now ready for votes to be cast. Will the outcome now matter in 2008?
And something for NASA to celebrate, a space craft now in orbit around Mars. You saw it unfold live here in THE SITUATION ROOM. Now we'll find out how the mission is going right now. Stay with us.
(COMMERCIAL BREAK)
BLITZER: Tonight Memphis, Tennessee is the place to be if you're a Republican with presidential ambitions. Some call it a cattle call, others liken it to a beauty contest. Either way, it's an early showcase and a testing ground for the 2008 race. And it's happening right now.
Our senior national correspondent John Roberts joining us now live from Memphis with more -- John.
JOHN ROBERTS, CNN CORRESPONDENT: Good evening to you, Wolf.
This is an opportunity, a weekend for Republicans to try to put away the problems of the present and look toward the future. It's really their first opportunity, the 1800 delegates who are going to be here in Memphis this weekend, to see most of the presumed presidential candidates all in one place.
And for 2008, the field is wide open. (BEGIN VIDEOTAPE)
ROBERTS (voice-over): The parade of famous Peabody Hotel ducks was the early draw, but it's the parade of possible presidential candidates that people are really here to see.
DEBBIE LOVE, DELEGATE: I'm listening, I'm opening, taking notes, seeing, you know, watching communication skills, ideas, direction, vision -- really is vision.
ROBERTS: While no one has yet declared, they are all laying the ground work. Senator John McCain's people were in early to chat up party officials. Massachusetts governor Mitt Romney held morning meetings behind closed doors. The backstage politics as important as the public perception of being presidential.
GOV. MITT ROMNEY, (R) MASSACHUSETTS: There have been some tough times in our nation's history. Every time we face them, we lift them up and we face them and we overcome them.
ROBERTS: Rudy Giuliani didn't make the conference. Though the other hopefuls will be here. Senate Majority Leader Bill Frist, Virginia Senator George Allen, Governor Mike Huckabee of Arkansas and Kansas Senator Sam Brownback.
It's the first cattle call in the 2008 presidential race, but with President Bush's popularity way down and control of Congress at stake, the first test for the candidates, says party chairman Ken Mehlman, is this year's midterm election.
KEN MEHLMAN, REPUBLICAN NATIONAL COMMITTEE CHAIRMAN: We're going watch, did they campaign hard to make sure that we keep a Republican majority in the House and a Republican majority in the Senate. So mark my words, the first primary of '08 is what the candidates do in '06 to keep our majorities.
(END VIDEOTAPE)
ROBERTS: We could get a better idea of how they the delegates are feeling in the straw poll which is being conducted tomorrow. But a minor controversy has erupted over that. Senator Trent Lott accused Senator Bill Frist of stacking the deck by busing in delegates.
Senator Frist told me just a little while ago, he can't believe that anyone would be as preoccupied with a straw poll as Senator Lott is. And tonight during his speech, Senator John McCain will say well let's vote for President Bush as a show of solidarity in that straw poll which some people sniped is just McCain afraid that he's going come in second -- Wolf.
BLITZER: John Roberts, thanks very much for that. John Roberts reporting.
For more on this story, what's happening online, let's go to our Internet reporter Jacki Schechner -- Jacki. JACKI SCHECHNER, CNN INTERNET CORRESPONDENT: Well Wolf, conservative bloggers certainly have something to say about the southern Republican leadership conference. Many of them are saying it is way too soon to thinking about '08, what we should be doing is thinking about '06 like the Democrats are.
And many of them are in support of that Bush write-in campaign that John was talking about, the idea being that that will show support for the president and we won't think so much about who the next president could possibly be.
But conservative bloggers do do straw polls of their own throughout the year. And the latest one is from Right Wing News. I want to show you who the most desired nominees were for 2008.
You can see at the bottom of the list, Condoleezza Rice and Rudi Giuliani in the 1 and 2 spot. They are not in Memphis today, or for the weekend. But of those who are, George Allen and Mitt Romney are the most desired nominees, or the top of that list.
As for the least desired nominee that would be John McCain, Chuck Hagel and Bill Frist. Frist and McCain are in Memphis, Hagel is not, but you want to keep in mind, Wolf, that conservative bloggers tend to skew a little more conservative than the GOP as a whole. And they don't like McCain and Hagel, because they tend to be a little more on the moderate side.
BLITZER: All right. Jacki, thanks very much.
While the Republicans gather in one place, Democrats with their eyes on the White House are all over the map. They are busy traveling to key presidential battlegrounds looking for a possible 2008 advantage.
Our chief national correspondent John King is taking a look at this looking at this part of the story -- John.
JOHN KING, CNN CORRESPONDENT: And Wolf, the Democrats are feeling pretty good right now. The president has low approval ratings, there's a bit of a Republican civil war over this ports controversy. Democrats insist they are worried most of all about November 2006, but when they look ahead to 2008, the name that comes up first and most is a woman who lived in the White House before.
(BEGIN VIDEOTAPE)
KING (voice-over): Any talk of the Democrats in 2008 starts here, though the junior senator, first has a 2006 race to worry about first.
STAN GREENBERG, DEMOCRATIC POLLSTER: She's smart. She'll have a good win in New York. And she'll be the front runner going into the primaries.
KING: Many Republicans relish the thought. Others aren't so sure. CHARLIE BLACK, REPUBLICAN STRATEGIST: Some people think Hillary Clinton is a polarizing figure and might be easily beatable. I don't think that. I think she's a very impressive, disciplined campaigner. And we need to put our best candidate forward and fight hard to defeat her.
KING: In the early -- emphasis on early polling, familiar names follow the leader. 2004 nominee John Kerry says he's thinking about another run, but no decision for a while. 2000 nominee Al Gore sat out the last one. But two Democrats who have chatted with him lately say don't bet on it, but don't rule out a 2008 comeback attempt.
Pollster Stan Greenberg says democrats like Kerry and Gore just fine but sees as sense of been there done that.
STAN GREENBERG, DEMOCRATIC POLLSTER: Pressure for change for 2008 is going to be very great -- a change in face, a change in direction.
KING: From there, things turn south.
Former North Carolina Senator and VP candidate John Edwards is making the rounds as is former Virginia governor Mark Warner who thinks come 2008, Democrats will be in the mood for someone not from Washington and not just competitive in blue states.
MARK WARNER, (D) FRM. VIRGINIA GOVERNOR: A Democrat party that's actually competitive in all states rather than simply 16 or 17, that serves the benefit not only the Democrats, but it serves the benefit of the whole country.
KING: As important as who runs for the Democrats, though, why would be the bigger issue.
UNIDENTIFIED MALE: Voters don't know what they stand for, need to be clarity of vision, there are whole series of new problems, and Democrats haven't, you know, really spoken too effectively.
(END VIDEOTAPE)
KING: Now Governor Warner -- former Governor Warner of Virginia, will be on the front page of the Sunday New York Times Magazine this weekend. That early notoriety can be a blessing, it can also be a curse. A number of other Democrats, about a hand full, also making the early rounds: they include Senator Evan Bayh of Indiana, you also have the two governors, Vilsack of Iowa, Richardson of New Mexico.
Wolf, a number of Democrats running. But they insist, as the Republicans do, the whole dynamic could change, and our list of prospects of who is on top could change depending on what happens this November. That is priority number one.
BLITZER: All, John, thanks very much. John King reporting.
The presidential election still two years and eight months away. Is it too early to be fixated on the race? Perhaps not if you want to win the White House, but voters may see it very differently so does our senior analyst Jeff Greenfield -- Jeff.
JEFF GREENFIELD, CNN CORRESPONDENT: Well Wolf, of course all America is agog at the prospect at this weekend Southern Republican Leadership Conference and a chance to gauge the prospects of a ketch of potential presidential candidates. Some 200 reporters are expected to be on hand to witness this event, featuring a straw poll which could well tell us almost nothing of any significance whatsoever.
(BEGIN VIDEOTAPE)
BUSH: I George Walker Bush...
UNIDENTIFIED MALE: Do solemnly swear...
BUSH: ...do solemnly swear...
GREENFIELD (voice-over): Now it is true that the potential presidents have been there since about five minutes after President Bush was sworn in for a second term. Their efforts have worked as a permission slip to the press to start covering and polling and speculating. But just for one second, cast a look back and see just how helpful such premature evaluation has been.
March 1990, among Democrats the three front runners are New York Governor Mario Cuomo, Reverend Jesse Jackson and 1988 nominee Michael Dukakis. None of them even ran in 1992.
And a small state governor named Clinton, Gallup didn't even bother to ask about him.
March 1994, this time Gallup's Republican front runner, Senator Bob Dole, did wind up as the nominee.
SENATOR BOB DOLE, (R) KANSAS: I say follow me. Follow me.
GREENFIELD: The runners up were Colin Powell, Ross Perot and Dan Quayle, none of them even entered the race.
March 2000, both front runners in this open race, Al Gore and George W. Bush did get their party's nominations, but the insurgent who ran a remarkably strong race, Republican Senator John McCain was polling 2 percent back then, so the polls got the winners right, but completely missed the nature of the Republican contest.
March 2002, the clear Democratic front runner former Vice President Al Gore. In second place, Senator Hillary Clinton. The ultimate one, two finishers John Kerry and John Edwards were drawing 6 percent and 2 percent.
The candidate who surged in 2003, Howard Dean, wasn't even on the polling list a year earlier.
(END VIDEOTAPE)
GREENFIELD: Now, I realize it's suggesting a sense of restraint about all this, waiting to see who has a compelling message, who turns out to be a stiff on the stump, who resonates with voters once they really start to pay attention a year-and-a-half from now, is hopeless futile. Why? Because the politically obsessed are like a family that sets out on vacation and as the car pulls out of the driveway, the kids begin shouting, are we there yet? No we're not, Wolf.
BLITZER: All right, Jeff. Jeff Greenfield thank you very much.
Republicans hoping to succeed President Bush are well aware that their own futures may be affected by the president's current problems. The collapse of the Dubai Port deal hanging very much over the heads of a lot of the GOP people attending the event tonight in Memphis.
Let's talk with one of the possible 2008 contenders, Senator George Allen, Republican of Virginia.
Thanks for joining us in THE SITUATION ROOM, senator.
SEN. GEORGE ALLEN (R), VIRGINIA: Good to be with you. I love Jeff Greenfield's view. The politically obsessed are in good numbers here.
BLITZER: Well, all of us are politically obsessed at least here in THE SITUATION ROOM.
Senator, tell our viewers why you are in Memphis right now?
ALLEN: Oh, I was invited. This is a generally southern states also midwestern states here mostly of course a lot of Tennesseans and folks from Arkansas and Mississippi, but it's a good chance for Republicans to get together. It's fun. People are friendly.
And it is good, I think, also for us to take assessment of where we are right now, what are the challenges we're facing presently, but I think also look to the direction of this country, where in my view we need to get united.
BLITZER: Senator, let me interrupt. You are there because you are thinking of running for the White House, is that fair?
ALLEN: They asked me to come here to speak to it. I'm focused on running for re-election. I hope the people of Virginia will re- elect me this fall. After that we'll make decisions in the future. The point of the matter is there a lot of friends here, new friends.
And if you want to be able to advocate your ideas, your principles, your philosophy, the mission for this country, this is a great opportunity to do so.
BLITZER: All right. Let's talk about some substance of issues before we talk about politics. The collapse of the Dubai Ports deal.
"The Washington Post" did an editorial and wrote, "Our brave new Congress has achieved more than the irrational spiking of one business deal. It has also sent a clear message to the Arab world: No matter how far you move along the path of modernization and cooperation, Americans may be unable to distinguish you from al-Qaeda." You're a member of the Foreign Relations Committee. Was this a blunder to kill this deal or are you happy the president was humiliated?
ALLEN: Oh, what a choice. I think it's a reasonable decision the Dubai Ports World made. The way that this was handled it wasn't presented to the American people in a way that, I think, there was an adequate discussion as to some of the risks.
I personally wrote Secretary Snow before all the hype got going some of my concerns. The UAE is though a very important ally for our Navy, for their Arab bases, for our strikes into Afghanistan, as well as mission into Iraq. So they still are very important friends as are other relatively moderate Arab countries there in the Gulf, whether it's Bahrain, Qatar or Kuwait and the UAE.
However, we're talking about critical infrastructure in this country. We all recognize our ports need great greater security, same with our airports, same as mass transit. And so I think it's not so much that we don't -- we wouldn't be all upset if they were buying an office building in this country. But if a government of another country is coming in to run port operations at some of our ports I think that should get...
BLITZER: So you are happy the deal has collapsed?
ALLEN: Well, I don't want to say I'm happy about it. I wish it was handled differently and maybe all of this would have been avoided in the first place. I do think we still have to improve port security, make sure containers are secure.
And also I think this whole review process needs to have more of a factoring of security, not just what's the best for commerce. And I am one whose very much for commerce, but when you are dealing, again, with our ports and critical infrastructure I think it is important that the homeland security aspect be better vetted as they go through these analyses, particularly if it is a government as opposed to a private company taking over certain operations.
BLITZER: Let's talk a little bit politics. The latest CNN "USA Today" Gallup poll that asked the question among registered Republicans who their choice for 2008 would be, Rudy Giuliani came in with 33 percent. John McCain 28 percent. You got seven percent. This is very, very early. But at least you got seven percent. I suppose you are encouraged to some degree, right?
ALLEN: Oh, sure. It's still early. People know Rudy Giuliani because he was mayor of New York City and did an outstanding job there particularly after 9/11. Folks know Senator McCain. He's run across the country. I've, you know, run for governor, gotten elected and run for U.S. Senate.
So it is still early. This whole meeting here in Memphis is a lot of fun, and they will have a straw poll, which is hardly anything more than really a pick-up game. BLITZER: One Republican strategist, Linda Duvall, recently said, "George Allen is the candidate with great potential but let's face it, running in Virginia is one thing versus running roughly in 30 primary contests."
You appreciate -- I'm sure you do -- the enormity of that challenge if someone wants to be president of the United States.
ALLEN: Sure is you have to be dedicated. You have to have your spouse and whole family behind you. You have to have people who are supportive. You don't do it for yourself. You are doing it for a cause, a philosophy, and hopefully having people motivated and inspired for your cause.
And I was chairman of the Republican Senatorial Committee in the last election cycle, and we had tough races from the Carolinas to Louisiana to South Dakota to Alaska. This is a big country.
But I do think that people regardless of where they live, whatever the region is, I think they will if properly motivated, they will unite behind certain ideas, such as securing our freedom, recognizing this land needs to be a land of opportunity for all, more competitiveness.
And I also think people want to preserve the values that made this country great and would like to see judges who understand the role of a judge is to apply the law and not invent the law and have a respect for representative democracy.
So this is a great country, but we need to improve. And I will always be advocating ideas like Ronald Reagan did and Thomas Jefferson to trust free people and free enterprise rather than a meddling government.
BLITZER: You got to always throw in your fellow Virginian, Thomas Jefferson. Senator Allen, thanks very much for joining us. We'll see you back here in Washington.
ALLEN: Great being here, Wolf.
BLITZER: Thank you.
And to our viewers you're in THE SITUATION ROOM where political news is arriving all of the time. Remember, CNN, America's campaign headquarters.
Political news also arriving on other issues, as well. Still to come this hour, he's a big fan, and he just legalized what is known as cage fighting in California. So why is the Governor Arnold Schwarzenegger a no show at tonight's landmark match?
Plus, hundreds of students clashing with riot police in Paris. We'll tell you what the violence is about. Stay with us.
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BLITZER: Zain Verjee's joining us now from the CNN Center in Atlanta with news making headlines right now -- Zain.
ZAIN VERJEE, CNN ANCHOR: Wolf, just a short time ago, a federal jury handed down a verdict in the trial of former Atlanta Mayor Bill Campbell. He was found guilty on three counts of tax evasion, but jurors of acquitted him of racketeering and corruption charges. The 52-year-old Campbell could get up to nine years in jail on the tax evasion count, although legal experts say that that's unlikely.
At New York's LaGuardia Airport, authorities have now stopped looking for man who left the security checkpoint before officials had finished testing for possible explosive residue from his shoes. Authorities say that he may not have realized that the screening process wasn't over. The Delta Airlines Terminal where this happened was partially evacuated earlier today, but it's now reopened and all flights, inbound and outbound, have resumed.
A Colorado high school teacher who made in-class comments comparing President Bush's State of the Union address to Adolf Hitler is being reinstated. School officials say that teacher Jay Bennish will return to Overland High School on Monday. He's been on paid administrative leave since the first of March. Bennish says that's excited to teach again. The student who taped Bennish's comments said he would do it again, but he doesn't want Bennish to be fired -- Wolf.
BLITZER: Thanks, Zain, very much. Up ahead, his controversial comments were secretly recorded months ago. Now they've surfaced and he's on leave from his city job. Details of what this Muslim cleric said.
Plus, Arnold Schwarzenegger legalizes so-called cage fighting, and California's first sanctioned bout is tonight. So how come he's not going? We're going to take you live to California for the controversy. Stay with us.
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BLITZER: The bottom line on the financial markets. Today Wall Street ended the week on a positive note, with all three major industries up, including the Dow, which gained more than 100 points. A better than expected February jobs report provided much of the momentum.
California's first legal cage fight takes place tonight, but the fan who made it possible -- that would be the governor, Arnold Schwarzenegger -- he won't be there.
CNN's Chris Lawrence is joining us now live from San Jose with more -- Chris.
CHRIS LAWRENCE, CNN CORRESPONDENT: Well, Wolf, these cage fights are illegal in most states, but Governor Schwarzenegger signed a bill that regulates them here in California.
Now, the first bout sanctioned by the state starts in just a little over an hour right behind me. It's already almost sold out. And all this comes at a time when the governor is under increased scrutiny, even from members of his own party.
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LAWRENCE (voice-over): Senator John McCain calls it "barbaric." New York Governor George Pataki, "Neanderthal." Thousands, though, are fans. California governor Arnold Schwarzenegger was supposed to attend an event like this last week in Ohio, but word got out, he got criticized and pulled out at the last minute.
ALLAN HOFFENBLUM, REPUBLICAN STRATEGIST: What he has to be careful of, that he doesn't get what is called the -- we call the Jesse Ventura syndrome.
LAWRENCE: Republican Hoffenblum says voters won't reelect a California version of the wrestler-turned-politicians.
HOFFENBLUM: He admits, by the way, that he's been too much a showboater, that he's out there at too many shopping malls, acting more like "The Terminator" rather than the governor.
LAWRENCE: But some take Schwarzenegger's scheduled change as a sign that he buckled under political pressure.
ARNOLD STEINBERG, POLITICAL STRATEGIST: What's extraordinary about this governor is that virtually all his wounds are self- inflicted.
LAWRENCE: Republican political strategist Arnold Steinberg says Schwarzenegger continues to run his own independent course.
STEINBERG: I think there's a certain amount of apprehension among certainly the hardcore Republicans, because there's a volatility and unpredictability to his decision-making, where you never know where he's going to go next.
LAWRENCE: Some say he's going back to moderates who elected him, deciding not to attend that cage match, and telling voters his priorities are repairing California's levees and building new schools and highways.
STEINBERG: So now we see him out there doing -- you know, advocating issues that are not fiercely partisan, are not fiercely ideological.
(END VIDEOTAPE)
LAWRENCE: And that's a clear strategy for re-election campaign in a state like California, where registered Democrats outnumber Republicans by more than a million voters -- Wolf.
BLITZER: Chris, thanks very much. Up ahead, details of a secretly recorded comment that have a Muslim cleric in New York in the spotlight right now. Is it free speech or is it hate speech? We're going to play you the tapes. Mary Snow is standing by.
(COMMERCIAL BREAK) BLITZER: A New York City Muslim chaplain is on leave from his job after a secret recording surfaced with some very controversial comments. CNN's Mary Snow is joining us now live from New York with the story and the tape -- Mary.
MARY SNOW, CNN CORRESPONDENT: Wolf, the Muslim clerics spoke at a conference almost a year ago, which is documented, and a lawyer for him says he's working on the assumption that the audiotapes are authentic. And says the real question has to do with free speech.
(BEGIN VIDEOTAPE)
SNOW (voice-over): We caught up Imam Umar Abdul-Jalil outside his Harlem mosque. He refused to answer any question over the fire storm that could cost him a city job.
But inside the mosque, he told his congregation that -- quote, "Hate mongers and slander mongers come around looking for controversy," saying "it's nothing but lies and slander."
Abdul-Jalil is a chaplain for the city's Department of Corrections.
UNIDENTIFIED MALE: Let us pray.
SNOW: He's seen here leading prayers at Mayor Bloomberg's inauguration. This week, a tape recorded speech surfaced of Abdul- Jalil speaking to Muslim students in Arizona last April.
UNIDENTIFIED MALE: We know that the greatest terrorists in the world occupy the White House. Without a doubt, that is a fact.
SNOW: On the subject of defining Islam, he paraphrases another Muslim leader.
UNIDENTIFIED MALE: We have to stop allowing, as the Imam said, to be reactionary, the Zionists of the media to dictate what Islam is to us.
SNOW: A group called the Investigative Project which says its mission is to expose extremism secretly recorded Abdul-Jalil.
LORENZO VIDINO, THE INVESTIGATIVE PROJECT: It's very important for the public to realize that certain individuals who claim to be moderate actually spout very radical views.
SNOW: Because of the tape, Mayor Bloomberg put Abdul-Jalil on administrative leave.
MAYOR MICHAEL BLOOMBERG (R), NEW YORK CITY: We'll take a look at what he said and what the laws are in terms of what he's allowed to say. He's a civil service employee, and we can't prejudge.
SNOW: But New York Republican Congressman Peter King says Abdul- Jalil should not keep his job saying -- quote, "No one who preaches anti-Semitism or equates the American government with terrorism should hold any position of responsibility in any city or state government."
(END VIDEOTAPE)
SNOW: Abdul-Jalil referred us to attorney Norman Siegel (ph), who said that this matter represents or presents serious and substantial First Amendment issues concerning the rights of public employees to speak off the job on issues of public concern -- Wolf.
BLITZER: All right, Mary, thank you very much.
Let's check in again with Zain for a quick look at other news making headlines around the world -- Zain.
VERJEE: Wolf, French police fired tear gas at hundreds of students today. Students flung back pretty much anything they could get their hands on. From the buildings, they threw down oil canisters, ladders, chairs, books and fire extinguishers. The clashes happened at the Sorbonne University, as well as other universities right across France. Students are upset over a measure that would make it easier for companies to fire younger workers. Supporters say it might actually help younger workers get hired, because they could be let go more easily. Critics say it undermines job security.
President Bush says Iran poses a grave national security concern for the United States, but he says he wants to resolve the standoff diplomatically. And the diplomats were hard at work today behind closed doors at the U.N. Security Council. They have been working on proposals to address the Iran nuclear crisis. The U.N. wants Tehran to stop all uranium enrichment activities. Iran says that under the Nuclear Non-Proliferation Treaty, it has a right to a nuclear program. Britain, France and Germany have said they want a tough statement. Russia and China may disagree.
And as you saw live here in THE SITUATION ROOM just a short while ago, look at this, cheers and high-fives at NASA's Jet Propulsion Laboratory. A signal from the Mars reconnaissance orbiter caused the excitement after a pretty nerve-racking wait. The orbiter was able to burn its engines and slowed down just enough to get into Mars' orbit. That's actually one of the trickiest parts of the mission. The $450 million spacecraft will search for signs of water and other signs of life on Mars, and scout some possible landing spots for human explorers -- Wolf.
BLITZER: Have a great weekend, Zain. Thanks very much.
VERJEE: You too.
BLITZER: Zain Verjee at the CNN Center.
Let's find out what's coming up right at the top of the hour. That means Paula is standing by. Hi, Paula.
PAULA ZAHN, CNN ANCHOR: Hi, Wolf, thanks so much. We're going to start off with a story that's scary for any of us who have kids. Your son or daughter may be exposing themselves to a frightening new danger. See how sexual predators are infiltrating some of the most popular sites on the Web. Have your teenagers posted their name, address and even pictures of themselves for criminals to see?
And does this look like fun to you, or does it look like absolute insanity? They call it backyard wrestling. But what's really happening out there will leave you asking, what are they thinking? We hope you'll join us in about four minutes from now. Wolf, see you at the top of the hour.
BLITZER: Thanks very much, Paula, for that.
Still ahead, an update on a developing story we're following, an FBI terror bulletin. Stay with us. You're in THE SITUATION ROOM.
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BLITZER: Back now to our top story. The FBI is warning stadium operators of possible terror attacks at sporting events. The FBI says there's no credible or specific information any attack is planned, but officials say there was an Internet posting calling for what was described as suicide attacks at sporting events. The FBI says that with college basketball championship games under way, it was prudent to send out the guidance. The FBI says the Web posting recommended one bomber detonate inside a stadium while others attack fleeing fans.
Paula is going to have a lot more on this coming up at the top of the hour.
And stay tuned to CNN day and night for the most reliable news about your security.
Let's leave you now with some of the hot shots, photographs coming in from the AP. Pandering -- excuse me, pandemic planning. The secretary of health and human services is suggesting -- that would be Michael Leavitt -- speaking at a bird flu conference in Wyoming, prudent planning.
Reunited. Lieutenant Commander Charlie Brown (ph) hugs his 4- year-old son at the Oceana Naval air station in Virginia. He returned today after six months in Iraq.
New recruits for the Iraqi army marching north of Baghdad. American hopes for a troop drawdown are tied to the army's efforts to attract Iraqi soldiers.
And newlyweds Alison and Ed Lucas (ph) tied the knot on home plate at Yankee Stadium. It's the first wedding ever to take place on the field.
Hot shots coming in.
I'll see you Sunday on "Late Edition." Among my guests, Zalmay Khalilzad, the U.S. ambassador to Iraq. Paula standing by to take over.
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