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The Situation Room

Russian Mole at CENTCOM?; China Security Risk?; Mad Over Immigration Reform

Aired March 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 ANCHOR: And 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, echoes of the Cold War. Russian spies obtaining secret war plans from inside the U.S. military's Central Command.

It's 7:00 p.m. here in Washington, where a brand new report says Moscow had a mole who may have tipped off Saddam Hussein.

Also this hour, a new port storm. This time, the Chinese may be involved in nuclear searches of cargo heading for U.S. shores. The Bush administration may be about to give the green light. Will America's security be at risk?

And the first lady and the King, a revealing and exclusive interview with Laura Bush by CNN's own Larry King. Larry joins us with highlights tonight here in THE SITUATION ROOM and talks from the heart about the cause he shares with Mrs. Bush.

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

We begin tonight with two developing stories. New concerns about espionage and about America's security. Did Saddam Hussein know where and when the United States would strike with help from a Russian mole inside the U.S. military's Central Command headquarters?

And a Chinese company may get the job of screening for radioactive threats in cargo headed directly for the United States. Will that put U.S. security at risk?

CNN's Brian Todd is standing by.

But let's first go to the Pentagon with CNN Pentagon Correspondent Jamie McIntyre standing by with a shocking -- potentially shocking revelation -- Jamie.

JAMIE MCINTYRE, CNN SR. PENTAGON CORRESPONDENT: Well, Wolf, what seems clear from this document cited in a new Pentagon report is that the Russian ambassador in Iraq was passing along sensitive military secrets to Saddam Hussein's government. What's not so clear is where he came by the intelligence.

(BEGIN VIDEOTAPE)

MCINTYRE (voice over): Among the thousands of documents examined by military historians, one sent to Saddam Hussein on March 24, 2003, just days into the war, contained intelligence on the U.S. war plans that the Russians' claim came from their sources in the U.S. Central Command in Doha, Qatar.

BRIG. GEN. ANTHONY CUCOLO, IRAQ PERSPECTIVE PROJECT: There is a document that exists that shows that a Russian ambassador to Iraq passed intelligence to the Iraqi high command.

MCINTYRE: The Iraqi document had details on the secret plans for U.S. troop movements during the initial phase of the invasion and cited the Russians as the source.

The document reads in part, "The United States is convinced that occupying Iraqi cities are impossible, and they have changed their tactic. Now they are planning to spread across the Euphrates River from Basra in the south to Al-Qa'im in the north, avoiding entering the cities."

That's pretty much what happened. But Saddam Hussein didn't heed the intelligence because, the report concludes, he suspected the U.S. advance from Kuwait was merely a diversion.

CUCOLO: This particular document we're talking about actually had no impact on a decision. We use it in the Iraqi Perspectives Project study as an example of how a piece of intelligence, plus a battlefield commander describing a situation, were essentially ignored because it was different from what Saddam had said.

(END VIDEOTAPE)

MCINTYRE: The Pentagon says it has no corroboration of the claim by the Russian ambassador that he multiple sources inside CENTCOM. And the authors of the lessons learned report says it was outside their purview to investigate that claim.

The say the document will simply have to stand on its own -- Wolf.

BLITZER: What are people at CENTCOM telling us about this? Because if it's true, I assume there is a full-scale investigation under way. Espionage at U.S. military headquarters in Doha, Qatar, that's a very, very serious business.

MCINTYRE: Well, as far as we know, Wolf, there is no full-scale investigation under way. They -- they've had this information for quite some time.

This report was finished in its classified form eight or nine months ago. And according to the report's authors, they didn't think the revelation was "a big deal."

It appears at this point that they -- again, no evidence that there was actually any spy or mole inside the CENTCOM headquarters. And they're not clear where the Russian ambassador came by the information that he passed along.

BLITZER: Well, I assume they're going to be checking and checking and checking, but we shall see.

Jamie, thanks very much.

Let's go to our Internet reporter, Abbi Tatton. She's tracking this Pentagon report online -- Abbi.

ABBI TATTON, CNN INTERNET REPORTER: Yes, Wolf, you can read it all for yourself. Over 200 pages of it on this report today. And it was posted today on the U.S. Joint Forces Command Web site.

It actually contains many of the captured Iraqi documents, defense plans for various cities, photos of the special Republican Guard exercises. We've posted an easy link for you so you can go and read it yourself, CNN.com/situationreport, and you'll find it there.

BLITZER: Thanks, Abbi, very much.

There's also a new development and new controversy related to port security. Just weeks after Congress torpedoed a deal to hand over control of U.S. ports to an Arab firm, is the Bush administration now hiring foreign companies to control security screening of cargo bound directly for this country?

CNN's Brian Todd is joining us. He's watching this story -- Brian.

BRIAN TODD, CNN CORRESPONDENT: Wolf, we've confirmed that a China-based company which happens to be the world's largest port operator may soon have a key role in screening cargo at a large port very close to the U.S.

(BEGIN VIDEOTAPE)

TODD (voice over): Should a Chinese company be involved in screening for nuclear material at these docks just 60 miles from Florida?

UNIDENTIFIED MALE: There's a chance for it to go haywire.

TODD: At the Freeport Container Port in the Bahamas, containers bound for the U.S. may soon be screened by Hong Kong-based Hutchison Whampoa. The U.S. Department of Energy is finalizing a contract for the Chinese company to operate screening devices that detect nuclear and radioactive material.

The U.S. government would provide the devices which would be mounted on so-called stradlers (ph) driven by workers from Hutchison Whampoa. Some homeland security experts say they are worried about espionage.

CLARK KENT ERVIN, CNN SECURITY ANALYST: The idea that we would give a contract, a no-bid contract, in fact, to a company with ties to China to operate radiation detection equipment at ports, cargo bound for the United States, is very troubling indeed. The issue here is whether those inspections will be done. We have no assurance of that because there's not going to be any, as I understand it, American inspectors stationed on the ground at these Bahamian ports.

TODD: Officials at the Department of Energy and U.S. Customs and Border Protection admit there are no U.S. Customs officials at Freeport yet. But they say they are laying the groundwork for that and they say they'll work closely with their Bahamian counterparts who will monitor the operation.

Other security experts say Hutchison Whampoa has an excellent reputation.

UNIDENTIFIED MALE: Hutchison Whampoa has on its own begun to do radiation screening of outbound containers sailing to U.S. ports from Hong Kong. They did that before the U.S. government even required them to do it.

(END VIDEOTAPE)

TODD: And U.S. officials say once the system is in place, 90 percent of all cargo will be screened at Freeport. On the criticism of this being a no-bid contract, U.S. officials tell us they had no choice. They needed to install these screening devices at Freeport and Hutchison Whampoa was the operator already in place there.

Now, contacted by CNN, a Hutchison Whampoa representative said they have been a global leader in port security, that preventing espionage and terror is as important to the company as it is to U.S. officials. And he stresses the company has no ties to the Chinese government -- Wolf.

BLITZER: Thanks very much, Brian, for that.

Let's dig a little bit deeper into the business details behind this contract. Our Ali Velshi has tonight's "Bottom Line."

(BUSINESS REPORT)

BLITZER: And to our viewers, stay tuned to CNN day and night for the most reliable news about your security.

Time once again for Jack Cafferty and "The Cafferty File" -- Jack.

JACK CAFFERTY, CNN ANCHOR: Thank you, Wolf.

Mr. Whine is at it again. French President Jacques Chirac stormed out of a meeting because a fellow Frenchman dared speak English instead of French -- sacre bleu!

The businessman told a European Union summit meeting that he would speak in English, the language of business. At that point, Mr. Irrelevance stomped out, followed by his finance minister and foreign minister. At a news conference today, Mr. Whine said he was deeply shocked that the man would choose to speak English rather than his native French. Mr. Chirac said it's important to promote French since English has grown more common at places like the Olympics and the United Nations.

Some outfit called the defense of the French language -- supported Chirac, saying, "Such snobbery from the leaders of some international companies to speak only the American business language is intolerable," followed by, of course, the requisite sniff.

Here's the question: Did Jacques Chirac overreact by walking out of an EU summit when a Frenchman spoke English?

E-mail us at CaffertyFile@CNN.com, or go to CNN.com/CaffertyFile.

BLITZER: Jack, you sometimes make these things up. I'm sure you do. But this is really what happened?

CAFFERTY: This is really what happened. He's like a child.

BLITZER: Jeez. OK, Jack. Thanks very much.

CAFFERTY: Yes.

BLITZER: Coming up, Americans on the march in the immigration wars. We're going to have a live report from Los Angeles, where protesters are setting the stage for a showdown on Capitol Hill.

Plus, religion on trial in Afghanistan. Will the life of a convert to Christianity from Islam be spared? There are new developments tonight in this dramatic and still developing story.

And what's Larry King's biggest joy? He's going to be telling us right here in THE SITUATION ROOM. And he'll also share some of the more riveting moments of his exclusive interview with the first lady, Laura Bush.

Stay with us. You're in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: Right now they are very, very angry and apparently they're not willing to take it anymore. Thousands of immigrants and their supporters are taking to the streets in Phoenix and other cities across the country. They're calling for humane immigration reform.

Our Chris Lawrence is joining us from Los Angeles, where there were some very angry demonstrations today -- Chris.

CHRIS LAWRENCE, CNN CORRESPONDENT: Well, Wolf, to a lot of these students immigration is not just some abstract policy that they read about in school, but an everyday issue that affects their own friends and family.

(BEGIN VIDEOTAPE) LAWRENCE (voice over): Thousands of high school students walked out of class to protest a new bill that cracks down on illegal immigration and toughens penalties for those who help them.

UNIDENTIFIED FEMALE: Why should we be called criminals because we are not going to turn in our relatives, our brothers and sisters, our friends, everyone?

LAWRENCE: Mostly Latino, they waved the Mexican flag, chanted "Brown power" and held up signs that said "Protect our rights." Their protest was part of a larger effort in other parts of the country.

On Thursday, more than 10,000 marched in Milwaukee. And today, perhaps more in Phoenix.

They're trying to pressure U.S. senators who are considering a bill already passed by the House. It makes it a felony to be an illegal immigrant. It would build a fence across hundreds of miles of the U.S.-Mexican border.

UNIDENTIFIED FEMALE: What kind of country is that? Didn't this country -- aren't we taught in our history classes it started with immigration? Who cares if they're legal, illegal? Was there such a thing in the beginning? Like, what about now?

LAWRENCE: One official estimates that well over half the public school students in Los Angeles have a Latino background but not necessarily illegal.

UNIDENTIFIED MALE: I consider myself an immigrant and I was born here.

LAWRENCE: Police locked down several schools to head off trouble, but Friday's march was peaceful.

(END VIDEOTAPE)

LAWRENCE: Yes, the walkout involved about eight schools and more than 3,000 students. Mots of them are too young to vote but old enough to let senators know where they stand -- Wolf.

BLITZER: Chris, thanks very much.

Chris Lawrence in L.A.

The immigration issue heating up online as well. Let's get the latest from our Internet reporter, Jacki Schechner -- Jacki.

JACKI SCHECHNER, CNN INTERNET REPORTER: Wolf, CNN.com has put together a collection of photographs from the protests today. Here you can see the massive rally in Phoenix, they're in protest of House Resolution 4437. You can see here the march on Senator John Kyl's office in protest of these new immigration restrictions.

Also in Georgia a protest at the state capitol. You can see, again, more photographs on the capitol steps. Now, there continues to be organization online. Bluelatinos.org, a national online organization of progressive (ph) Latinos is organizing today in Cleveland, tomorrow in California and Los Angeles. And then on Sunday in New York City.

On the other side of the issue, No More Amnesty has been all this week doing a "Save the American Worker" week. That continues tomorrow. There will be a protest here in D.C. unrelated, but border security activists, Wolf. That's here in D.C.

BLITZER: Jacki, thank you so much.

Jacki Schechner reporting.

Still to come tonight right here in THE SITUATION ROOM, there's been lots of pressure on the Afghan government to show mercy to a man who rejected Islam in favor of Christianity. The stakes very, very high: the death penalty.

Is the pressure about to pay off? We're going to have some new developments just moments from now.

Also, the king of talk is also the king of hearts. Larry King joins us in THE SITUATION ROOM to talk about his exclusive interview with the first lady, Laura Bush, and his all-consuming desire to help low-income people get life-saving heart surgery.

Stay with us.

(COMMERCIAL BREAK)

BLITZER: Turning to Afghanistan and new developments in the case of a man who's been threatened with execution because of his conversion to Christianity from Islam.

Let's go live to CNN's Fredricka Whitfield once again at the CNN Center for more -- Fred.

FREDRICKA WHITFIELD, CNN ANCHOR: Hello again, Wolf.

A stunning development involving an Afghan man on trial for being Christian. It's brought international outcry after U.S. forces fought and died to rid Afghanistan of the Taliban.

(BEGIN VIDEOTAPE)

WHITFIELD (voice over): When we introduced you to Abdul Rahman in Afghanistan he was facing a death sentence for holding this belief...

ABDUL RAHMAN, DEFENDANT (through translator): I believe in Christianity. I believe in the holy spirit. I am a Christian.

WHITFIELD: Rahman converted to Christianity 16 years ago. At his trial, an Afghan judge issued this alarming remark... ANSARULLAH MOWLAWIZADA, JUDGE (through translator): If he does not repent you will all be witness to the sort of punishment he will face.

WHITFIELD: Local prosecutors want Rahman executed for apostocy. And at Friday prayers, top clerics agreed.

SAYED ASIF MOHSN, AFGHAN CLERIC (through translator): Abdul Rahman was once a good man, but he turned his back on god and turned against humanity. So he must be executed.

WHITFIELD: But just a short while ago, an Afghan government officials said Abdul Rahman should be released "in the coming days." This follows intense pressure from the Bush administration, from the president on down.

CONDOLEEZZA RICE, SECRETARY OF STATE: We've made very clear in the strongest possible terms that this principle of religious freedom and the right to religious conscience is at the core of democratic development and at the core of democracy. We are working with the Afghans and we look to a favorable resolution of this case. It needs to be favorably resolved.

WHITFIELD: U.S. Secretary of State Condoleezza Rice says Afghanistan is a young democracy but suggested it must act like a democracy.

(END VIDEOTAPE)

WHITFIELD: The Afghan cabinet is to meet to discuss Rahman's case just hours from now -- Wolf.

BLITZER: Thanks very much, Fred, for that.

Even after the overthrow of the Taliban, Afghanistan's legal system still is partly based on Islamic law, the Sharia, which declares conversion to Christianity a death penalty offense. But the country's constitution also says Afghanistan will abide by international agreements, including those that promote freedom of religion.

We're watching the story closely.

And even if Abdul Rahman is freed, there still may be some lasting fallout from this case for the Bush administration.

Let's bring in our senior analyst, Jeff Greenfield -- Jeff.

JEFF GREENFIELD, CNN SR. ANALYST: Well, Wolf, just as the president was wrapping up a vigorous campaign to defend his Iraq policies with those open-ended give-and-takes with the press and citizens, a new problem emerged from the other country where American troops had gone to war, and this problem strikes at the heart at both the president's rationale for his policies and at his Republican base.

(BEGIN VIDEOTAPE) GREENFIELD (voice over): News that an Afghan citizen, Abdul Rahman, was facing the death penalty for converting to Christianity has exploded across the news. The president has already said he's deeply troubled by the threat.

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: That's not the universal application of the values that I talked about.

GREENFIELD: In fact, that's the heart of the dilemma. When U.S. forces ousted the taliban four and a half years ago, it wasn't just to hit the staging area for al Qaeda and the attacks of September 11. Taliban rule was a harsh, deeply repressive brand of Islam, where women were forbidden to learn, where heretics of sorts were killed in the most brutal of ways.

Indeed, the Bush administration in its national security strategy in 2002, the intellectual underpinning of the war in Iraq, argued, among other things, that religious tolerance was a nonnegotiable universal value. The president celebrated Afghanistan as a victory for freedom, its leaders were showcased at the White House and its State of the Union addresses.

So the notion that an Afghan citizen could be killed under religious law for simply converting to Christianity seemed to undercut that rationale. Not to mention the fact that one of the key elements of the Republican base, politically-engaged Christians, has already been pressing the Bush administration on human rights issues, especially involving the persecutions of Christians abroad.

No wonder the case has already engaged Republicans like Senator Bill Frist, who wants the Republican nomination in 2008 and knows that base is crucial.

When any American president puts American blood and treasure at risk to defend another nation there's always a risk that misconduct by that other nation can threaten support for the policy. We saw that with stories of corruption and brutality from South Vietnam.

(END VIDEOTAPE)

GREENFIELD: And today, if you had to come up with the worst possible story to afflict this administration, it would be hard to top the story of a government put into power by U.S. force under the banner of spreading freedom now threatening to kill a citizen for the crime of becoming a Christian -- Wolf.

BLITZER: Jeff Greenfield, thank you very much.

Just ahead, the vice president hammering away at his critics, offering some parting shots against his Democratic challengers. We're going to tell you what the vice president is saying.

And Laura and Larry. Our Larry King sits down with first lady, Laura Bush. They talk about the war in Iraq, presidential polls, even one of Mrs. Bush's top picks to be the next president of the United States. You're going to see it right here in THE SITUATION ROOM, the first lady and Larry King. That's coming up.

(COMMERCIAL BREAK)

BLITZER: The top guns of the Bush White House have been firing away at Democrats today. President Bush and Vice President Cheney appearing in different states, but they seem to be working together to try to help their party and perhaps the president's poll numbers as well.

You're looking at these live pictures, Air Force One and the president's limousine. He's coming back to Washington from Pennsylvania, where he was out campaigning for Rick Santorum.

Let's bring in our White House correspondent, Elaine Quijano, with more -- Elaine.

ELAINE QUIJANO, CNN WHITE HOUSE CORRESPONDENT: Good evening to you, Wolf.

That's right, both President Bush and Vice President Cheney out stumping for congressional candidates today. And at a time when Republicans have been divided on a number of issues, including immigration, their appearances were clear calls to united against Democrats.

(BEGIN VIDEOTAPE)

QUIJANO (voice over): On the campaign trail in Orlando Vice President Dick Cheney hit back against the Democrats' latest attack line that President Bush is, quote, "dangerously incompetent."

DICK CHENEY, VICE PRESIDENT OF THE UNITED STATES: And leading Democrats demanded a sudden withdrawal from the battle against terrorists in Iraq. If they're competent to fight this war then I ought to be singing on "American Idol." I don't know why that's funny.

QUIJANO: Minutes later at a fund-raiser in Indianapolis, President Bush assailed Democrats on the economy, saying their record on the issue consisted of what he said were loud noises and votes against tax cuts.

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: The difference is clear. If you want the government in your pocket, vote Democrat. If you want to keep more of your hard-earned money, vote Republican.

QUIJANO: The administration's two-pronged attack was a carefully coordinated move. A sign this election year the Bush White House has launched into full campaign mode. But factoring into the political equation now is the start of year four of the Iraq conflict. Critics say despite the president's recent push to turn around low public opinion...

BUSH: Democracy is on the march in Iraq. QUIJANO: ...Americans, they say, may be suffering from message fatigue.

P.J. CROWLEY, FORMER CLINTON ADMIN. OFFICIAL: Actually the more the president talks about Iraq, you know, the harder it becomes for him. You know, his, you know, round of speeches in December and more recently have really had no significant effect on public opinion because for the most part the American people feel they've heard this message before.

(END VIDEOTAPE)

QUIJANO: Still the president believes that continuing to send out the message on Iraq is critical, especially as images of violence from Iraq continue to fill Americans' TV screens -- Wolf.

BLITZER: Elaine, thank you very much.

The vice president's line about "American Idol" was certainly funny but was it a smart political move? It's a question for our "Strategy Session" tonight with Democratic strategist James Carville and Bay Buchanan, the president of American Cause.

(BEGIN VIDEOTAPE)

JAMES CARVILLE, CNN POLITICAL ANALYST: Him talking about competence is like me talking about hair. Don't know very much about it now, do we? And I have to tell you, when it comes to Cheney, of course red Rover, red Rover, send Dick Cheney right over. I can't imagine the Democrats...

BLITZER: Do you think Republicans who are in close races with the Senate or the House or governors are going to want Dick Cheney coming into their districts, their states, to campaign for them?

BAY BUCHANAN, CNN POLITICAL ANALYST: I don't think they would hesitate to have Dick Cheney come in. I think the key is this is reminiscent of the old Spiro Agnew. The key -- what the vice president is trying to do here is create a national agenda for Republicans. And so whether he goes into this state or not or just talks to national television, the point is make that trump card stronger than ever.

National security works for Republicans. Let's bring it up there. Let's put the Democrats on the defense. They are splintered on it. They fall apart every time somebody says something strong in their -- takes strong action in their party. Let that happen again between now and November.

CARVILLE: I was just in Pennsylvania. I think he ought to go up and help Rick Santorum tomorrow. I think he ought to campaign.

BLITZER: He's there tonight. He's there tonight.

CARVILLE: Yes. Go campaign around the states.

BLITZER: Bush is there tonight.

CARVILLE: Get Cheney to campaign around the state. I bet you it will be tonight, and it will be short.

BLITZER: But he could raise money for him. They are good at that.

CARVILLE: They should be able to. They have done everything that they could for the lobbying community. Why wouldn't they be able to raise -- of course, they can raise money. Look, Rick Santorum is the king of Kay Street. They are going to rake in a lot of money. That is a given. But what Cheney needs to do is go up and campaign around the state, go with Santorum and go door to door with him.

BUCHANAN: You know, everyone is talking about, oh my gosh, people are going to run away from the president. The key is what James just said. The president will raise you huge sums of money, millions of dollars. Well, if there is a little bit of slippage, that millions of dollars will help buoy that up and put you up even higher. So of course you bring him in, the earlier the better. You bring Laura in in the last couple of weeks, and everything will work out just fine.

CARVILLE: Keep him out late and he can raise money.

BLITZER: The president was out campaigning today. Listen to what he said. We have this clip.

(BEGIN VIDEO CLIP)

BUSH: The reality in the world in which we live is there's an enemy which hates those of us who embrace freedom and would like to strike us again. And therefore, it's important to have members of the United States Congress who understand the stakes in the global war on terror.

(END VIDEO CLIP)

BLITZER: Is that a successful strategy, you think, for them, to be hitting home in effect suggesting Democrats really don't understand the issues?

BUCHANAN: Well, I think depending on how you say it, yes it is effective. The key here is every poll shows that if the Democrats are perceived as weak on security that they're going to lose, that the American people will not gamble on national security. So if you can create that atmosphere using the president and the vice president...

BLITZER: But that gap, you know, has been narrowing and narrowing and narrowing.

BUCHANAN: Yes, but it's still there. And you can get it up again if you make the people think that indeed this threat is real and eminent. CARVILLE: He didn't say anything I disagreed with. There are people who don't wish us well. There are people that would like to strike us again. That's why Democrats overwhelmingly support implementing the recommendations of the 9/11 Commission, which, by the way, gave this administration a D on security.

That's why more and more people are saying the Democrats are just as good. The polls are almost equal. So I don't disagree with what he said at all. I just think the Democrats are a lot stronger on this issue than they are.

BLITZER: Listen to what Senator Chuck Hagel, a Republican, but he has got an independent streak, what he said yesterday. He said, "Democrats keep blowing every opportunity we give them. And I've told my Democratic friends if nothing else, just keep your mouths shut and just let us self-destruct. But they won't even let us do that." It's a good line from him.

CARVILLE: It is, but I think they're doing a good job of it anyway to tell you the truth. I don't think we've been able to stop them from self-destructing. People ask me, gee, why aren't the Democrats profiting? In our poll it was something like a 15-point congressional ballot test right now. You have nowhere to go but down from there.

(END VIDEOTAPE)

BLITZER: James Carville and Bay Buchanan. Here is the breakdown, by the way, of the poll James was just talking about. When asked for their choice for Congress, 55 percent of registered voters nationwide said Democrats, 39 percent said Republicans.

And remember you're in THE SITUATION ROOM where political news is arriving all the time. CNN, America's campaign headquarters.

We're getting this in to CNN just now.

CNN's Fredricka Whitfield is going to update us. There is a developing story we've been watching, some stranded ferry passengers.

What's the latest?

FREDRICKA WHITFIELD, CNN CORRESPONDENT: That's right. Off the coast of Washington and right now we can show you live pictures. On the left-hand side of the screen is a larger ship, the 360-foot cruise ship, where about 220 people were on board. This ship has been stranded for a few hours now. It's stuck on a sandbar.

Well, now to no avail, all the efforts that the U.S. Coast Guard and others have been trying to move this ship off the sandbar, to no avail. Now the people on board that cruise ship, called the Empress of the North, will be transferred right on that platform right there. They will walk across that and then hop onto the other waiting ship, which is more of a ferry. And it is called the Queen of the West.

They will be taken then to Portland, Oregon, which was their original destination, but all of those people on board were hoping to get by being on that original ship -- Wolf.

BLITZER: Thanks very much, Fred. We'll continue to watch this story together with you.

Up ahead, the first lady of the United States sits down for an exclusive interview with Larry King. Larry gives us a preview of what Laura Bush has to say. How she feels about the war in Iraq and if and when she thinks the .S. troops should leave.

And France's president gets upset when a fellow Frenchman speaks English at a meeting. Do you think he was right or wrong? Jack Cafferty weighing your thoughts. You're in THE SITUATION ROOM.

(COMMERCIAL BREAK)

(BEGIN VIDEOTAPE)

BLITZER: Welcome back. Joining us in THE SITUATION ROOM, our own Larry King. First of all, Larry, welcome to Washington. You had quite a day over at the White House today. Tell us about the interview you had with the first lady.

LARRY KING, CNN ANCHOR: Yes, we did an interview with the first lady in advance of my Cardiac Foundation dinner tonight. You know, she's become the chairman of a lot of causes that deal with heart disease. She's become the red dress lady.

So we spent about half the time discussing heart disease that affects women, and the other half her general life and some politics. She was charming, and very, very well-spoken. And it was the first interview she's ever done on television in her office.

BLITZER: In her own office over on the East Wing of the White House.

KING: The East Wing. We were actually in her office, which is a small office, by the way.

BLITZER: I'm familiar with that office. I want to play for our viewers a little excerpt. You got into the whole issue of Iraq, which is such a powerful, passionate, sensitive subject. Listen to this.

(BEGIN VIDEO CLIP)

LAURA BUSH, FIRST LADY OF THE UNITED STATES: It's very difficult to watch on television and see the loss of our soldiers in Iraq and to get the idea that the Iraqis don't care, that they don't want us here, that it's a sacrifice they don't respect or regard. I do think they do.

I think the people in Afghanistan -- and I know the people of Afghanistan, from when I've been there, say don't leave. You know, don't leave us yet. Let us build our democracy. Let us get all of the institutions of democracy into place before you go. There are many, many countries that want the help of the United States, and that get the help of the United State, and I hope the American people can feel proud of that.

(END VIDEO CLIP)

BLITZER: She is really emotional. What did you walk away with, because you were getting her, I guess body language if you will.

What was -- what did you walk away with? Because you were getting her, I guess, body language, if you will ...

KING: She is ...

BLITZER: ... on this whole subject.

KING: I would say, Wolf, she is as committed as the president.

BLITZER: To this cause?

KING: Yes.

Now, he may be more vibrant in stalking the stages and making all these speeches, but I think she's just as committed. I don't think there's a doubt in her mind that they're doing the right thing. I think she's a little puzzled -- maybe everyone in the White House is a little puzzled as to public reaction.

I don't think they expected it to be this negative. And I -- in some ways, I don't know that they believe it.

BLITZER: I don't think they expected it to be as difficult three years into this war as it clearly ...

KING: No.

BLITZER: ... has become. Forget about the public reaction, the actual war.

KING: The actual war and the reaction, I think, are both surprises to this White House. But she totally, in my opinion, supports her husband.

BLITZER: You also got into the issue of 2008 and beyond. She is still a young woman. I want to play this other clip from the interview. Listen to this, Larry.

(BEGIN VIDEO CLIP)

KING: Would Secretary Rice make a good President?

BUSH: She would make an excellent President, but I don't think we can talk her into running.

KING: No?

BUSH: I don't think so. I think she sincerely does not want to run, but I wish she would.

KING: Want to go back to college?

BUSH: I think she probably wants to move back to California and have a wonderful and -- you know, life, post-secretary of state. But she is a wonderful secretary of state for our country, and she would be a great President.

KING: There's this story she wants to be commissioner of the National Football League.

BUSH: Well, I heard that she said he didn't want to now, that she was still going to continue to be secretary of state.

(END VIDEO CLIP)

BLITZER: That's a good job, being commissioner of the NFL...

(CROSSTALK)

KING: You're not kidding.

BLITZER: ... as you and I know, Larry.

KING: Pays better, too.

BLITZER: It would be a lot of fun.

(CROSSTALK)

BLITZER: You get paid to watch football games.

KING: What is surprising about that was, that was pretty close to an endorsement.

BLITZER: Yes.

KING: She would make a wonderful president, and she would like to see her run, in a sense, hope she changes her mind.

I think they're not supposed to endorse, but that was ringing.

BLITZER: Well, what was clear, also, this is a first lady who would like to see women in more prominent positions. She clearly wanted a woman in the Supreme Court. That didn't work out for her husband.

She loves Condoleezza Rice, as you know. And...

KING: I asked her about her daughters. And I said, would she like both of them, or one, to be first lady. And she said, why not run? Why not run for office? Why just first lady?

BLITZER: She's going -- she's an ambitious woman.

KING: Yes.

BLITZER: Talk a little bit about the dinner you went to. You have your own dinner tonight we are going to talk about in a second, but the dinner ...

KING: Yes.

BLITZER: ... you were at the White House last night.

KING: I got invited to this dinner. It was only 63 people there. And it was not a formal dinner. It was only seven tables.

BLITZER: It was not black-tie.

KING: Was not black-tie.

They had the Marine, you know, playing a little music. And -- and it was in honor of Ben Franklin's 300th birthday. And since Ben has been such a frequent guest on our show ...

(LAUGHTER)

BLITZER: You know Ben Franklin.

KING: I know him.

(LAUGHTER)

BLITZER: He's -- I got him booked for THE SITUATION ROOM.

(LAUGHTER)

KING: I thought that that's why I was invited.

And it was a wonderful dinner. My wife sat with the president. And I sat with Andy Card. And the conversation was not political. It was all just fun. The president asked questions, as my wife told me, like, "What are you reading now?"

BLITZER: She was at his table.

KING: Yes.

What are you currently reading? And she answered that she's currently reading her diary. She keeps a running, you know, events of her life. And then they got into a whole discussion in that table about why that's a wise thing to do.

And, then, they had a guy who looked like Ben Franklin, acted like Ben Franklin, and who makes a living playing Ben Franklin all over the country. And he got up and spoke. He did some Franklinisms.

BLITZER: And he did it well?

KING: Very well.

BLITZER: Tell us about the foundation, your dinner tonight, because...

KING: Yes. BLITZER: ... a lot of your viewers -- first of all, how this started, the personal history you had, and how it has grown over the years.

KING: In 1987, in February, I had a heart attack. Subsequently, in December, I needed heart surgery. I had quintuple-bypass surgery.

And we were sitting around one day, about a year later, and someone asked what it cost. And I said I didn't know. Insurance covered it. CNN insurance covered it. And they said, well, what about people who can't afford it?

And, so, we started investigating. And there is a lot of people not insured, not covered for something like heart disease. Now, I think that's wrong. I think everyone should -- if you need heart surgery, you should be able to get it in a country as rich as ours.

That being the case, we started this charity. We hold two dinners a year, one in Los Angeles, one in Washington. My son is the president. My wife is the chairman. We have great entertainers come. We have had Celine Dion, Ricky Martin, great comics. We have just a wonderful time. And we do it as a party.

And we salute people. Joe Robert, your friend, is being saluted tonight. And we sell out. And we raise a lot of money. And it's a party. We don't have the long speeches. We have a lot of fun.

The next one is September in Los Angeles. Neil Diamond will be the entertainer. That's not bad.

BLITZER: I love Neil Diamond.

KING: And it all goes to helping people.

So, we have helped close to 200 individuals get new procedures, like a new heart, or heart surgery ...

BLITZER: And you could ...

(CROSSTALK)

KING: ... or bypass surgery.

BLITZER: They're alive today in part ...

KING: Because of us.

BLITZER: ... because of what you have done.

KING: And I cry every time. You know, when I get to make the call -- I don't run the foundation. But I get to make the call, when they select someone, doctors select. And I get to call up and say, Mrs. Jones -- once they hear it's me, they know they're going to get it, you know, that we are going to have ...

(CROSSTALK) BLITZER: That they have won this -- they won the lottery.

KING: You don't get a bigger joy.

The biggest joy I get is making that call, is helping someone live.

BLITZER: Larry...

KING: There's no bigger joy, Wolf.

You're the...

(CROSSTALK)

KING: If you get involved with something, it almost controls you.

BLITZER: Well, thanks for the good work.

And I'm sure there are a lot of people out there who are grateful to you.

Tonight, the interview airs, 9:00 p.m. Eastern, "LARRY KING LIVE," with the first lady, Laura Bush.

KING: And I must say, one of my dreams of my life is to be with you in THE SITUATION ROOM.

BLITZER: That dream has come true.

KING: What a situation this is.

(LAUGHTER)

BLITZER: No one like it.

KING: Thanks, Wolf.

BLITZER: Larry, thanks very much.

(END VIDEOTAPE)

BLITZER: And up ahead, did Jacques Chirac overreact? The French president stormed out of an E.U. meeting because a fellow Frenchman -- get this -- actually spoke English instead of French. What do you think about that? Jack Cafferty is thinking about it. He's got your e-mail.

And wish you could combine your BlackBerry, your cell phone, your laptop, all into one? Well, guess what? Technology may now have a new way. We're going to share it with you.

(COMMERCIAL BREAK)

BLITZER: Jack's back with "The Cafferty File." Jack. JACK LAFFERTY, CNN ANCHOR: Thanks, Wolf. French President Jacques Chirac stormed out of a European Union summit meeting because a fellow Frenchman dared to speak English instead of French. In a news conference today, Chirac said he was deeply shocked that the businessman would choose to speak English. The question we asked is, did Jacques Chirac overreact by walking out of an EU summit meeting when a French businessman spoke English?

Donald in Pasadena, Maryland, wrote: "Absolutely, but what's new? Chirac is a severely imbalanced megalomaniac in a leadership position of a dysfunctional nation."

Terry in Phoenix, Arizona: "Fantastic! Soon we'll have the rest of the world speaking and doing business in English, and the U.S. will have Spanish as the national language."

Janet in Weaverville, North Carolina: "Yes, Chirac went too far, just like we did with our `freedom fries.'"

Jean in Texas: "Of course he overreacted, but isn't that what being French is all about?"

Don in Healy, Kansas: "His only mistake is, he shouldn't have stopped walking until he reached the middle of the English Channel."

Gates in North Carolina: "Such a petty, small-minded and childish act by an adult who is the head of state for France. The French think they have a superior culture, and this goofy act defines them perfectly."

And Jim in Brighton, Michigan: "I love french fries, french toast, french kissing. But Chirac can take his ethnocentricity and shove it."

Wolf?

BLITZER: One of the great things I did years ago, I interviewed Jacques Chirac -- I convinced him to do it in English. He went to Harvard, he speaks English well and he actually sat down, did an interview with me in English. A great achievement on my part, Jack.

CAFFERTY: On your -- did anybody watch it?

BLITZER: People were watching it. Jack, see ya. Thanks very much for that. Jack Cafferty. Don't forget: "IN THE MONEY" Saturdays and Sundays, Jack's back over the weekend.

Let's find out what's coming up right at the top of the hour. "PAULA ZAHN NOW" -- Heidi Collins filling in for Paula again tonight. Heidi.

HEIDI COLLINS, CNN HOST: Cafferty giving you a hard time?

BLITZER: Always does.

COLLINS: At the top of the hour tonight on "PAULA ZAHN NOW," the latest on a shocking crime that happened in Tennessee. The wife of a popular church minister is in custody. Did she kill her husband in cold blood? We're going to be talking about that.

Also, what's different about this sexy singer? Well, she's Muslim and because of what she does, some people want to kill her.

And what turns people into pack rats? We'll look into a rare disorder that convinces some people they can't throw anything away.

All of that and more at the top of the hour, Wolf.

BLITZER: Thanks, Heidi. I know people like that. Thank you very much. Coming up at the top of the hour.

Still ahead, gizmos of the future. You think technology is mind- boggling right now? Wait until all of your digital devices are combined into one, coming up next here in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: Cell phones, Blackberries, laptops. In today's edition of "Welcome to the Future," CNN's Miles O'Brien shows us the future of combining all of your devices into one.

(BEGIN VIDEOTAPE)

UNIDENTIFIED MALE: It's funny. Each of these is supposed to save me time but because I have to use them all it winds up costing me time.

UNIDENTIFIED MALE: I've got two cell phones. Neither one does everything I need it to. They have their pluses and minus. But there's no way to combine the best aspects of each phone. The systems aren't compatible. If there was some way to combine them into one device I can carry around, I'd be set.

To me, the most important thing is to be able to do everything I can do on a computer on a handheld device. The technology is out there to do it. I'm waiting for it.

MILES O'BRIEN, CNN (on camera): So am I. But the single device solution -- phone calls, e-mail, web surfing pictures, organizer -- you know, the gadget that does it all -- remains the digital Holy Grail. I'm wondering if it will ever be discovered.

(Voice-over): You bet, says technology analyst Rob Anderly (ph). He says the answer may lie in a new breed of fourth generation or 4g mobile devices.

ROB ANDERLY (ph): The cell phone is trying to evolve into a personal communications device but something less than a laptop in terms of size. But encompassing all of that in terms of the device.

O'BRIEN: Due out by 2010, 4G comes with promises of full Windows XP capabilities, broadband Internet speeds and a set of worldwide service standards. I'll believe it and buy it when I see it. UNIDENTIFIED MALE: It's supposed to bring everybody together in some type of a "kum ba ya" environment, and things will work. But be aware, we've had this promise before. I wouldn't hold my breath.

(END VIDEOTAPE)

BLITZER: Here's a look at some of the "Hot Shots" coming in form our friends at the Associated Press. Upper Freehold, New Jersey: an investigator examines the scene at a horse barn destroyed by a fire.

Seattle, the former vice president, Al Gore, gives a speech on the threat of global warming.

Amman, Jordan, a health worker takes custody of a cage of pet birds. The country is concerned about the threat of bird flu.

Those are some of today's "Hot Shots."

I'll see you Sunday on "LATE EDITION," the last word in Sunday talk. Among my guests, the secretary of State, Condoleezza Rice. "LATE EDITION" airs Sunday, 11:00 a.m. Eastern. Thanks very much for joining us. Heidi Collins filling in for Paula.

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