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The Situation Room

Rivers Rising to Dangerous Levels Across Northeast; New Israeli Airstrikes in Southern Gaza; Insurgent Truce Offer?; Imad Moustapha Interview; New York City Unveils Plan to Move Millions Should Hurricane Hit; Ed Rendell Discusses Flooding; New U.S. Spy Satellite Orbiting Earth

Aired June 28, 2006 - 16:59   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 today's top stories.

Happening now, scramble for safety or stay and risk death.

It's 5:00 p.m. in the Northeast, where at least nine are dead from unyielding floods and rain. In parts of Pennsylvania and New York State right now, officials order as many as 215,000 people to evacuate. Rain-swollen rivers could overflow and dams could still burst.

And it's midnight in Gaza, where Israel launches zero tolerance acts. That's what they're calling it. Israelis want to recover their kidnapped soldier. They're striking hard at this moment in southern Gaza. And now they've sent warplanes flying over Syria.

And eavesdropping on America's enemies. The military has launched a new weapon to spy on terrorists and rogue nations. We'll have an exclusive look.

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

We're following a developing story across the Northeast, where days of rain have rivers rising to very, very dangerous levels. There's already widespread flooding and a number of deaths reported. One of the most dire situations unfolding right now in Wilkes-Barre, Pennsylvania, where as many as 200,000 people are under a mandatory evacuation order.

CNN's Jason Carroll is there.

(BEGIN VIDEOTAPE)

JASON CARROLL, CNN CORRESPONDENT: One foot of rain fell in Wilkes-Barre, Pennsylvania, in the past 24 hours. The rain has come and gone, but the problems are still here.

If you take a look behind me, you can see the results of the swollen Susquehanna River. The dykes here can hold 41 feet of water, but the river has already reached 38 feet in some parts and it still hasn't crested. So that's a major concern for people down here.

Two hundred thousand people in the surrounding area have been ordered to evacuate. The National Guard has had to rescue people from rooftops who were flooded out in sections of eastern Pennsylvania.

Five hundred people are in shelters in Susquehanna County and counting. Three people have drowned in floodwaters.

In the southeastern portion of the state there are problems there, too. Emergency officials in Bucks County are keeping an eye up there on the Delaware River.

JOHN DOUGHERTY, DIRECTOR, EMERGENCY SERVICES, BUCKS COUNTY, PENNSYLVANIA: Right now the creeks are starting to go down, but the problem is going to be the Delaware River. It's already starting over its banks and the projections are looking that it's going to be worse than our '05 April flood and may be approaching a record level.

CARROLL: There have been many roads and bridges that have been washed away by floodwaters, and that's making it difficult for emergency crews to get to people who are in rural areas. Some of the locals that we talked to say that from their point of view it doesn't appear to be so bad, not when they compare it to the massive amount of flooding that took place back in 2004. At this point many of them just waiting to see how much more of the floodwaters continue to rise -- Wolf.

(END VIDEOTAPE)

BLITZER: Thanks very much.

Jason Carroll reporting from the scene.

Let's bring in our Tom Foreman. He's here to give us a better idea of what exactly is going on and where.

TOM FOREMAN, CNN CORRESPONDENT: Yes. Let me give you an idea of the area we're talking about in the country here.

If we move in and take a look at the targeted area that we're looking at -- and this is the Susquehanna River, the part we're really talking about through these valleys all through here. Sidney, New York, up this way. That's where these truckers died because a runaway creek washed out part of the interstate here.

A little bit further down is Binghamton, which is one of the towns that -- a nice little town here. The river runs right alongside Interstate 88 right there. I've been through this area a lot of times. A nice little town here, but all wrapped around the river, as a lot of these are, and you get that funneling effect of all the mountains pushing all the water down into these valleys where the towns are built.

And then down here at Wilkes-Barre is the part we really have to look at, because this is the area -- if you look at where the river ran right into the middle of it there, this is a place that's had trouble in the past. If you move in, I'll show you there are these big bridges that lead right across the river in downtown Wilkes-Barre. People gather there a lot, and they're gathering there right now to watch this flooding.

Right along the side of this are big levees that were built up after flooding in the 1970s ended up making about 20,000 families lose their homes. So they built all of this up specifically for this, but the danger is that this water right now is expected to crest very near the top of those levees.

And look at the low-lying areas of Wilkes-Barre. That is how much area is potentially susceptible to what the river could do.

There's the river running through it a little bit. And if you look at how this wraps all around up into the valleys, that's why people are concerned, because the river's cutting right through that area. And they're watching it rise and rise and rise.

BLITZER: This is really a tense moment. And there's a history of serious flooding in that area.

We're going to watch it very closely and we're going to be speaking shortly with the governor of Pennsylvania, Ed Rendell.

Tom, thanks for that.

We have some pictures of the Susquehanna that are causing some of these problems upstream in Binghamton, New York, as well. As many as 15,000 people there have been ordered to evacuate as the river spills over floodwalls that are supposed to protect that city.

States of emergency are now in effect in 10 New York State counties. There are also evacuations along the Delaware River in New Jersey.

And check this out. These pictures show the extent of the flooding that hit the Washington, D.C., area on Monday. This is an auditorium at the National Archives, where water rose above the stage. The building which houses the Declaration of Independence remains closed because electricity is out. But we're told no documents are damaged.

There's other escalation in the situation in the Middle East. Paula Hancocks is joining us from Jerusalem with the latest.

What's going on, Paula?

PAULA HANCOCKS, CNN CORRESPONDENT: Well, Wolf, in just the past few minutes we have heard about an Israeli airstrike on a target in southern Gaza. Now, the Israeli defense forces saying that they threw a missile from a helicopter because they were trying to destroy a weapons factory in southern Gaza. No reports of casualties at this point.

Now, these airstrikes have been going on all day in north and southern Gaza. The Israeli forces have cut off north from the south by bombing bridges and also taken out a power plant, so there's little electricity and water supply in Gaza.

What the Israeli forces are trying to do is to find a kidnapped Israeli soldier that they lost on Sunday morning. Palestinian militants have him at the moment. The Hamas government, as well, and the Palestinian Authority have said they would give him back if there was a prisoner swap. Now, this is something that Israeli Prime Minister Ehud Olmert has refused.

We're hearing also the Israeli army is warning residents in the northern Gaza area to stay indoors and to stay out of crossfire, suggesting there will be an escalation in the military incursion in that particular area.

Now, an interesting development. We know in the early hours of Wednesday morning Israeli airplanes and warplanes actually flew past Syrian President Bashar Assad's house. Now, the IDF says this is because they think there's a direct link between President Assad and the exiled Hamas political leadership that is based in Damascus at the moment, Khaled Meshal, who the Israeli forces say is responsible for taking this particular Israeli soldier hostage.

So, Ehud Olmert saying he's not going to negotiate, but at the same time another complicating matter. Indications that one of the militant groups has got another hostage, an 18-year-old settler. They've shown a photocopy of the I.D. card of the settler and say they will kill him if Israel does not stop this raid.

And then other reports of a further -- 62-year-old Israeli having been taken hostage. No independent confirmation of that at the moment -- Wolf.

BLITZER: Paula, thank you for that.

Paula Hancocks reporting from Jerusalem.

A tough story out there in the Middle East. How might Syria respond to these latest moves by Israel, including the buzzing of the Syrian president's house? In just a few minutes, I'll speak live with the Syrian ambassador to the United States, Ambassador Imadd Mustapha. He's going to be here in THE SITUATION ROOM.

Let's go to Iraq, though, first. Do Iraqi insurgents who've killed so many American troops really want to make peace? The Associated Press reports that insurgent groups are offering to stop attacking coalition troops, but only if American-led forces leave Iraq within two years.

Our senior Pentagon correspondent, Jamie McIntyre, asked Defense Secretary Donald Rumsfeld about this new development earlier today.

Jamie, what did he say?

JAMIE MCINTYRE, CNN SR. PENTAGON CORRESPONDENT: Well, Wolf, Defense Secretary Rumsfeld said he hadn't heard about this specific proposal by 11 different Sunni groups reported by The Associated Press. But he said there have been other offers like this in the past.

He was very cautious, though, about anything that would resemble horse trading with insurgents over a timetable. A timetable for the withdrawal of U.S. troops, he said, still remains a bad idea. But he did embrace the idea that for there to be a resolution in Iraq there was going to have to be a national reconciliation.

(BEGIN VIDEO CLIP)

DONALD RUMSFELD, SECRETARY OF DEFENSE: Other countries have engaged in reconciliation processes of various types. And I think it would be a good thing if they are able over time to come to some understandings among all of the elements of the country as to how they feel it would be appropriate to resolve some of those issues and then go forward.

(END VIDEO CLIP)

MCINTYRE: Now, Wolf, this is just the latest we've heard in the last several days of various overtures from insurgent groups talking about the possibility of laying down their arms in the wake of the proposal from the Iraqi prime minister, Nuri al-Maliki, to his national reconciliation program.

Today on Capitol Hill, the head of the Senate Armed Services Committee, John Warner, his Democratic counterpart, Carl Levin, seemed to also indicate that they think that it's an intriguing time in Iraq in which -- in which these kinds of overtures ought to be considered. Also, they got a briefing from General Dempsey, the trainer of Iraqi troops over there, Martin Dempsey. He also indicated that he thought reconciliation was the key to moving ahead in Iraq -- Wolf.

BLITZER: All right, Jamie. Thanks very much.

We may be hearing shortly from Osama bin Laden.

Zain, what are you picking up?

ZAIN VERJEE, CNN ANCHOR: Wolf, CNN's confirmed that there's a message posted on an Islamic Web site that says Osama bin Laden will issue a videotaped message apparently paying tribute to Abu Musab al- Zarqawi. You'll remember the al Qaeda leader that was killed in Iraq recently.

The message apparently doesn't say exactly when this video's going to be posted, and it's not even clear if Osama bin Laden himself would actually appear in it. He's issued three audiotapes in the past. The last videotape that Osama bin Laden made, I believe, was October 29, 2004.

A similar advertisement of sorts, if you will, was issued for an al-Zarqawi tribute, Wolf, that was put out last week by al Qaeda's number two, Ayman al-Zawahiri. It appeared on the Web just a day before, on a Thursday, and the video was actually posted on a Friday.

The exact translation on the Web, Wolf, says this: "Coming soon, Osama bin Laden's new message, a tribute to the martyr of the nation and the emir of the martyr Abu Musab al-Zarqawi. God rest his soul" -- Wolf

BLITZER: We remember, as you pointed out, Zain, the last time we heard from him just before the U.S. presidential election back a couple years ago.

Jack Cafferty is in New York.

Jack, I suppose you can't wait to hear what Osama bin Laden has to say.

JACK CAFFERTY, CNN ANCHOR: I just want to hear he's dead.

"Democrats have failed to acknowledge the power of faith in the lives of the American people." Those words coming from one of their own, Illinois Senator Barack Obama, speaking at a conference of a faith-based movement to fight poverty.

Senator Obama said, "If we don't reach out to evangelical Christians and other religious Americans and tell them what we stand for, the Jerry Falwells and Pat Robertsons will continue to hold sway."

He also spoke about the importance of religion in his own life.

Obama's the only black member of the Senate. He's a popular fund-raiser for other Democrats. And there's talk among Democrats that he might ought to be on the party's ticket come 2008.

So here's the question. Senator Barack Obama says Democrats should court evangelicals and other religious Americans. Is he right?

Your thoughts, CaffertyFile@CNN.com or go to CNN.com/CaffertyFile.

BLITZER: Jack, thanks for that.

Up ahead, condemning "The New York Times." Efforts are under way in the House. We'll talk with one of the lawmakers who's leading the charge, Congressman Peter King. He'll join us in THE SITUATION ROOM.

Also, an exclusive look at one of America's newest spy satellites as it's being built. David Ensor got that exclusive look. He'll share it with us.

Plus, it's happened before, but is New York prepared for another hurricane? We'll show you why even a relatively small storm could be a disaster for New York City.

Stay with us.

(COMMERCIAL BREAK)

BLITZER: Disgraceful, even treasonous, choice words used by the president and conservatives angry at "The New York Times" and other newspapers. They're reacting to the publication of a secret anti- terror program which sifts through millions of financial transactions. But how much of the worry is actually real and how much is red meat for conservatives?

I'll ask Congressman Peter King, a Republican from New York, about that in just a few minutes.

But let's begin with CNN's Brian Todd -- Brian.

BRIAN TODD, CNN CORRESPONDENT: Wolf, those reactions that you just spoke of obviously very serious, but some are now asking how serious was the intelligence damage?

(BEGIN VIDEOTAPE)

TODD (voice-over): For days, President Bush and his allies have been publicly furious that the news media revealed details of a secret program to monitor millions of personal financial records in order to track suspected terrorists.

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: And for people to leak that program and for a newspaper to publish it does great harm to the United States of America.

TODD: But the president himself has spoken publicly about new programs to track terrorists' money since the early aftermath of September 11th.

BUSH: We've established a foreign terrorist asset tracking center at the Department of the Treasury to identify and investigate the financial infrastructure of the international terrorist networks.

TODD: Even some specific information about the massive banking database the administration is tapping, called SWIFT, has been in the public domain.

VICTOR COMRAS, FMR. U.N. TERROR FINANCING MONITOR: I think the rhetoric here is a little bit too high and too strong.

TODD: After 9/11, retired U.S. foreign service officer Victor Comras joined a United Nations team observing different terror tracking programs. Comras helped write a publicly posted U.N. report in December 2002 mentioning SWIFT as one of the banking information centers "rich with payment information. The United States has begun to spot and verify suspicious transactions."

COMRAS: Certainly, the terrorists must know that their own vulnerabilities with terrorism financing since we've been announcing and bragging quite a bit about how effective our tracking of terrorism financing has been.

TODD: Others disagree. Dennis Lormel tapped into the SWIFT database when he was an FBI counterterror official. We asked Lormel, if the program was public knowledge, how did "The New York Times" report compromise operations?

Lormel gave two examples.

DENNIS LORMEL, FMR. FBI COUNTERTERROR AGENT: They laid out for everybody the SWIFT methodology in a sense and how SWIFT operates. And the second one, you know, just by virtue of the fact that it had the front page and garnered the attention of so many people, it gives them the ability to take a good hard look at the operation and to realize that they have to take steps to change their methodology.

(END VIDEOTAPE)

TODD: Lormel says that means the more sophisticated, more dangerous terrorists are now being driven further underground. They're changing their tactics as we speak, he says, and now intelligence agencies have to adapt all over again.

But "New York Times" executive editor Bill Keller has said their report didn't tell terrorists anything they didn't already know. And he doesn't believe the report endangered any lives.

But Wolf, the fallout continues. Just moments ago we got this copy of a House resolution condemning the publication of this information. This resolution sponsored by Republican Michael Oxley of Ohio. We're told that this resolution should be voted on by tomorrow.

BLITZER: Brian, thanks very much for that.

So how might Congress or the Bush administration pursue the leakers of this story and the newspapers that published the leaks?

(BEGIN VIDEOTAPE)

BLITZER: And joining us now, Republican Congressman Peter King of New York. He's the chairman of the House Homeland Security Committee.

Congressman, I know that the House leadership, the Republican leadership is thinking of introducing some sort of sense of the Congress resolution. Condemning what?

REP. PETER KING (R), NEW YORK: As I understand the resolution -- and I've seen different drafts of it -- it would certainly condemn the leaks, those who have leaked this classified top-secret information. And it calls on the media to cooperate with the government, to save American lives, not to be running with these leaks the way "The New York Times" did last December and again last week on the whole overseas financial transactions.

BLITZER: Are you more angry at "The New York Times," shall we say, "The Wall Street Journal," the "Los Angeles Times," or at those government officials, whether in the executive branch or the legislative branch, who gave this information to the news media?

KING: Wolf, I think it's equal. I think those who leaked it are absolutely contemptible. The reason I have focused my fire on the media, especially "The New York Times," is because I don't think enough debate has focused there. It's always at those who do the leaking, which is absolutely terrible, but I thought it was also important to realize that the media, such as "The New York Times," I think have failed disgracefully in their obligations and have crossed the line of responsibility to irresponsibility.

So I am outraged at "The New York Times," and I'm equally outraged, if not more so, at those government officials who have sworn an oath and have actually leaked classified information in a time of war to the media.

BLITZER: Should the Justice Department launch a criminal investigation of the leakers, those government officials who provided this information to the news media?

KING: Absolutely. The government should go all out against those who did the leaking. And one way to get them is to put "New York Times" reporters in the grand jury and ask them to reveal their sources. And if they don't, find them in contempt and put them in prison.

And I know that sounds very harsh and heavy-handed, but the fact is, we're at war, and those who are leaking are committing a terrible crime. I believe those in "The New York Times" are also guilty of a crime. But to get at the leaker, one way to do that, is to put the reporters in before the grand jury.

BLITZER: What about "The Wall Street Journal" reporters and the "Los Angeles Times" reporters?

KING: Yes, I think they should also go after "The Wall Street Journal" and the "LA Times."

The reason I'm focusing more on "The Times" is they were the ones who first decided to go with it. My understanding is, the "LA Times" and "The Wall Street Journal" were holding back and they were in discussions with the government and didn't decide to go forward until "The Times" did.

Having said that, there's no reason at all why the attorney general should not go after the reporters at the "LA Times" and "The Wall Street Journal" to have them reveal their sources. Because to me, important as the shield law and certain privileges are to the media, to me it's more important that we stop these leaks, because American lives are at risk.

BLITZER: The argument has been made, though, that there really was no damage to national security, that the information in all of those stories basically had been out there more or less almost since 9/11. You reject that argument.

KING: Yes, I do. I'll tell you why.

Obviously, the president made it clear from the start we were going to do all we could to intercept and monitor overseas financial transactions. And I'm sure al Qaeda knew we had some success at it.

They did not know, though, the full extent of the penetration we had done. They were not aware of the arrangement with SWIFT They did not realize how all-encompassing our plan was and how effective it was.

And so now we have basically turned over our plan of attack, or a plan of defense, either way you want to look at it, to al Qaeda. So now we've told al Qaeda exactly what we have. We've taken all the guesswork out of it.

BLITZER: Here's what a U.N. report in 2002 concluded. This is the U.N. al Qaeda and Taliban monitoring group report. It was released publicly. It's on the Web.

"The settlement of international transactions is usually handled through correspondent banking relationships or large-value message and payment systems, such as SWIFT, Fedwire or CHIPS systems in the United States of America." It goes on to say, "The United States has begun to apply new monitoring techniques to spot and verify suspicious transactions."

That's one argument that basically al Qaeda was already aware of the SWIFT monitoring operation.

KING: They were aware, perhaps, that we had started this, that we'd made some inroads. But again, you take people like Governor Kean, who was the 9/11 chairman, Lee Hamilton, who was the co- chairman, Congressman Murtha, none of whom has any partisan agenda. They, based on their own knowledge of it, believed that this was damaging to our national security.

Again, al Qaeda had bits and pieces. They obviously had some indication. They did not know the full story.

"The New York Times" gave them the full story. And that's where to me the real disgrace was.

BLITZER: The other argument that your critics are saying is that the Patriot Act itself, which was enacted shortly after 9/11, spoke about making sure that the United States follows the money, gets involved in intercepting international wire transfers. And let me read to you what Stuart Levy, the Treasury under secretary, said on September 22, 2004 before the House financial Services Committee.

"As the formal and informal financial sectors become increasingly inhospitable to financiers of terrorism, we have witnessed an increasing reliance by al Qaeda and terrorist groups on cash couriers. The movement of money via cash couriers is now one of the principal methods the terrorists use to move funds"

Basically, he's saying a couple of years ago they already knew the U.S. was monitoring and they're now using cash couriers to distribute their money.

KING: Right. Yes, they were to some extent. They obviously were using cash more than they were prior to September 11th, and they realize we have made progress. The point I'm making, though, is they did not know the full extent of the progress we had made, and it's not just al Qaeda itself, but also those who may be transferring money to others who will be then transferring it to al Qaeda.

So, in other words, this is a chain of transactions, and not everyone was aware of the full extent to which we had managed to penetrate these transactions. And again, we are laying it out for al Qaeda, we are laying it out for those who will be making the transactions. And again, it's not just one thing we're looking at, it's a whole system of transactions.

Al Qaeda did not know the full extent of it. And that's where it's at.

And that's why, again, people like Governor Kean and Congressman Hamilton went to "The New York Times." And also, you know, "The New York Times" can't have it both ways. They can't now say, well, this was all public information, but yet say last week they had to reveal it because it was such a secretive program.

So, you know, "The New York Times" is trying to have it both ways.

BLITZER: "The New York Times," not surprisingly, in an editorial went after you today, and they wrote this -- they said, "We would have been very happy if Congressman Peter King, the Long Island Republican who has been so vocal in citing the Espionage Act, had been as aggressive in encouraging his colleagues to do the oversight job they were elected to do."

You want to respond to "The New York Times?"

KING: Yes, absolutely. I mean, Congress was doing the oversight that it had to. The chairman and ranking members of the intelligence committees in the House and Senate, the majority and minority leaders, the speaker of the House, they all knew of this. And to me, that is the type of oversight you need.

You can't have all 535 members of the House and Senate knowing everything about every top-secret operation that's going on. Those who had to know on both sides of the aisle were told about it.

This is -- this is war. This isn't the same as a highway bill or a tax bill. This is life and death. And "The New York Times" should understand that.

BLITZER: Peter King is a Republican from Long Island.

Thanks for coming in.

KING: Wolf, thank you.

(END VIDEOTAPE)

BLITZER: And coming up, is Syria playing a role in the kidnapping of an Israeli soldier? The Israelis fly over the Syrian president's residence warplanes. I'll ask Syria's ambassador to the United States about this message from the Israelis. The Syrian ambassador standing by to join us live.

Plus, countdown to the launch of the Space Shuttle Discovery. Our Internet reporters are going to show you how you can follow every step online.

(COMMERCIAL BREAK)

BLITZER: Welcome back.

New conflict today between Palestinians and Israelis, and new questions also about Syria's alleged role in harboring terrorists. As we mentioned earlier, it led to military conflict earlier today.

CNN's Zain Verjee joining us with the latest developments -- Zain.

VERJEE: Wolf, Israel appears to be putting pressure on the Syrian government to end the crisis in Gaza. It sent a strong signal to the Syrians today.

(BEGIN VIDEOTAPE)

VERJEE (voice-over): Force and firepower to free a kidnapped soldier. Israel attacks Hamas targets in Gaza. Hours later, fast and low, Israeli warplanes buzz over the home of Syria's president, Bashar al Assad. According to Israeli officials, Assad was probably there at the time. Syrian television reports that anti-aircraft guns fired at Israel's jets.

Israeli Prime Minister Ehud Olmert says Hamas' leaders in Syria are directly responsible for this crisis. Israel says Hamas' command structure is headquarter in Damascus and protected by the Syrian government. Israel believes Syria also funds and arms Hamas. It accuses Hamas leaders in exile of ordering the kidnapping of the soldier.

Hamas chief Khalid Meshaal lives in Syria. He's viewed by Israel as the ringmaster of terror attacks. And the Israeli justice minister says Meshaal is not immune from reprisals. He's been the target of a previous assassination attempt by Israel.

The Israeli ambassador to the U.S. says Israel is sending a clear message to Assad that he is responsible for the crisis in Gaza, and that he needs to lean on Meshaal and get the hostage released to end this crisis.

(END VIDEOTAPE)

And on the Gaza operation, Wolf, the U.S. State Department says that Israel has the right to defend itself, but it's also urging Israel be restrained and be careful about innocent civilians -- Wolf.

BLITZER: Zain, thanks very much. So how might the government of Syria respond to these latest moves by the Israelis? Joining us here in THE SITUATION ROOM is the Syrian ambassador to the United States, Imad Moustapha.

Mr. Ambassador, welcome to THE SITUATION ROOM.

IMAD MOUSTAPHA, SYRIAN AMBASSADOR TO THE U.S.: Hi, Wolf.

BLITZER: Is it true, as the Israelis allege, that the Syrian government supports Hamas directly with military equipment?

MOUSTAPHA: Actually, this is a preposterous and a ridiculous accusation. The only way the Syrians can know about what's happening in the occupied territories is for them to watch news channels. The Israelis know this very well.

The reality is the following. The Israelis have committed atrocities against Palestinian women and children in the past three weeks. The situation has spiraled down, and the level of violence has risen up. What is happening today in the occupied territories is the direct response and reactions to the terrible Israeli policies.

BLITZER: What's your reaction to the Israeli warplanes buzzing over the home of the Syrian president, Bashar al Assad?

MOUSTAPHA: Well, the reaction is the following. Israel is trying to provoke Syria. It's trying to escalate the situation and rise the level of tension in the Middle East. Syria is not involved whatsoever in what's happening there. The only reason that the violence is taking place there is the continuous occupation by the Israelis and the daily killing of Palestinians. Daily killing.

BLITZER: Do you know if Syrian anti-aircraft fire...

MOUSTAPHA: Yes, of course.

BLITZER: ... tried to shoot down those Israeli planes?

MOUSTAPHA: Actually, a number of Israeli planes did fly over the Syrian coast, and Syrian anti-aircraft guns did fire against these planes.

BLITZER: The argument that the Israelis make is that your government has a lot of influence over the Hamas-led Palestinian government, specifically you harbor Khalid Meshaal, the leader of Hamas...

MOUSTAPHA: Khalid Meshaal is not the leader of Hamas. Khalid Meshaal is the politburo, the political spokesperson for Hamas. He was expelled from the occupied territories by Israel. He was expelled to Jordan and then to Syria.

What is happening today in the West Bank and Gaza has everything to do with the actual reality of the ground, not because of the ridiculous accusations that somewhere far away in Damascus, things are being conducted through remote control. BLITZER: Can the Syrians play a role in trying to convince the Palestinian Authority, the government, to release this Israeli soldier?

MOUSTAPHA: Look, let's be realistic. The only country in the world that can play a role so that the situation calms down in the Middle East is the United States of America. It can convince Israel to stop its atrocities against the Palestinians which are being committed on semi-daily basis. In the past ten days, tens of Palestinians, women and children lost their lives, with no reaction whatsoever from Washington, D.C.

BLITZER: Wouldn't it make sense that to calm tensions, let the soldier go and then start talking?

MOUSTAPHA: The Palestinians are only asking for one thing, release minor children and innocent women from Israeli prisons in exchange for those hostages.

BLITZER: What is Syria going to do now that the Israelis have made this dramatic flyover over Syrian air space?

MOUSTAPHA: This is mostly theatrical. The real purpose of this flight is to divert attention. Instead of actually addressing the situation in the West Bank and Gaza and looking at the incredible injustices being inflicted on the Palestinians, Israel is trying to tell the world, "Look, the problem is in Damascus. It's not in the occupied territories."

BLITZER: One final question before I let you go. Based on the information that you have, is Hezbollah now directly involved in Gaza? As we know, Hezbollah's very active in Lebanon. But what about Gaza?

MOUSTAPHA: Hezbollah is a Lebanese national resistance movement that fought against the Israeli occupation in Lebanon. Once the Israelis left Lebanon, Hezbollah has not been involved in any way whatsoever in anything that has nothing -- that has not to do with the Lebanese issues. This should be clear. And we should not believe Israeli propaganda.

BLITZER: So you're not going to ask for a Security Council meeting?

MOUSTAPHA: Everybody knows that the United States of America has the veto power in the United Nations Security Council. So no resolution would pass in the Security Council unless the United States approves of.

BLITZER: Imad Moustapha is the Syrian ambassador here in Washington. Mr. Ambassador, thanks for coming in.

MOUSTAPHA: Thank you, Wolf.

BLITZER: And coming up, if a hurricane like Katrina ever hit New York City, what would happen, and would officials be prepared? Coming up, you're going to see for yourself. Mary Snow is standing by to take a closer look at the city's evacuation plan that's been unveiled.

And a CNN exclusive. Our national security correspondent David Ensor takes a closer look at a spy satellite that's orbiting the earth right now. Stay with us. You're in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: More now on the severe flooding. The rains, the problems in New York and Pennsylvania and Maryland and Delaware. Zain's got a new development she's watching right now.

What are you watching, Zain?

VERJEE: Wolf, we're watching pictures from WABC, our affiliate. We want to show you some images coming to us from Port Jervis in New York. These are some aerial pictures. Port Jervis is a small city that's located at the junctions of three states; New York, New Jersey, Pennsylvania.

The entire area has been flooded, especially because that is an area where two rivers, the Neversink and the Delaware meet. And the region has been utterly submerged. It's some of the worst flooding that we've seen in this area and in the eastern United States, as you say, with days of massive downpours and at least nine people killed in this region, mass evacuations -- Wolf.

BLITZER: All right, Zain. We'll watch this story. Bad, bad weather.

Might it be a nightmare in New York, 31-foot tides, 100-mile-an- hour winds, and parts of Manhattan flooded? Could a major hurricane hit New York City anytime? Mary Snow is in New York watching this potential disaster -- Mary.

MARY SNOW, CNN CORRESPONDENT: Well, Wolf, you know, just as thousands in the Northeast are being evacuated, today, by coincidence, New York City unveiled its plan to move millions should a hurricane hit, and some say it's not a matter of if but when.

(BEGIN VIDEOTAPE)

SNOW (voice-over): When Hurricane Katrina brought the unimaginable to New Orleans, New York officials started imagining the worst. What if a major hurricane like the 1938 Long Island Express that packed 120-mile-per-hour winds struck again now in a city along the coast housing 8 million people?

MICHAEL BLOOMBERG, MAYOR OF NEW YORK CITY: If you read the stories about Katrina, what apparently happened, in many cases people didn't know -- didn't have a ways to get out. We're not going to make that mistake.

SNOW: Low-lying areas like lower Manhattan, home to Wall Street, could flood, even in a category 1 storm, say officials, because of the surges created by the bend in the coastline where New York and New Jersey meet. A category 2 storm, shown in this simulation, could put this tunnel connecting Brooklyn to the island of Manhattan underwater.

It's not just water but winds of more than 100 miles an hour could be a big problem. In a category 4 storm, the worst case scenario with a storm surge of up to 31 feet, up to 3 million people would need to be evacuated with the city using schools as shelters, city buses as a way out.

JOSEPH BRUNO, NYC OFFICE OF EMERGENCY MANAGEMENT: We would start evacuation, movement -- if we saw something major coming -- at least three days out.

SNOW: A state assemblyman who's been a vocal critic of the city's preparedness says too many people would be left at risk.

RICHARD BRODSKY (D), NEW YORK STATE ASSEMBLYMAN: The vulnerabilities are terrifying. If it hits New York, New Orleans will look like a walk in the park.

SNOW: City officials outlined a plan for hospitals and nursing homes, and officials have been reaching out to residents like Russian immigrants in Brighton Beach, who don't speak English, by getting out the message on ethnic radio stations. Some city officials applaud the effort but have concerns.

PETER VALLONE, JR. (D), NEW YORK CITY COUNCILMAN: This looks good on paper, but this is 8 million people. And, you know, when a storm's approaching, is it going to work?

(END VIDEOTAPE)

SNOW: And the mayor of New York, Mike Bloomberg, says another lesson learned from Katrina is the need to be self-sufficient -- Wolf.

BLITZER: Let's hope it doesn't happen, Mary. Thanks very much.

Still to come. Look, up in the sky. It's not a bird, it's not a plane, it's a spy in the sky satellite. Our David Ensor got an exclusive up close look before it blasted into orbit. His report, which you will see only here on CNN, is coming up. Stay with us.

(COMMERCIAL BREAK)

BLITZER: As many as 200,000 people have been evacuated in and around the Wilkes-Barre, Pennsylvania, area as the rain and the floods continue. Let's get the latest. The governor of Pennsylvania, Ed Rendell, is joining us on the phone.

Governor, thanks very much. How bad is the situation? What's the latest information you're getting?

GOV. ED RENDELL (D), PENNSYLVANIA: Well, we have actually two phases of this flood, Wolf. Right now, there are 13 counties including Lackawanna and Lucerne (ph). But as you go even a little more north where people are literally still on rooftops -- and we've got 14 helicopters doing search and rescue pulling people off of rooftops. We even pulled a few people off of rooftops on a border town in New York State with the New York people's approval.

So it's an ongoing battle in a number of those counties. And then the second wave, when the flood waters come down the Susquehanna and the Delaware from New York, we're expecting to get hit maybe late this evening and early morning tomorrow. And that's what Wilkes- Barre's facing?

Right now, Wilkes-Barre, which is diked -- which was diked after the famous flood and has 39-feet-high dikes -- Wilkes-Barre is evacuating as a precaution. It was the mayor's call, but one that we strongly support. Because at that point, there were reports that the flood was going to crest at 38 feet, left very little margin for error.

And a lot of the secondary roads around the Wilkes-Barre area are closed, so we were afraid of a New Orleans-type situation where we just couldn't get people out if the dike broke or if the dike was...

BLITZER: So Governor, what's your worst case fear right now? When do you see the potentially -- the worst unfolding? Are we just hours away from that?

RENDELL: Well, I think the next 12 hours will be pretty crucial for Pennsylvania. Again, we're fighting in 15 counties, Wolf. We're fighting serious problems now. But the next 12 to 14 hours will tell whether this is a full-scale disaster in Pennsylvania.

BLITZER: Governor, we'll check back with you. We wish everyone in Pennsylvania and New York and New Jersey and Delaware, Maryland the best. This is an awful situation. Good luck.

RENDELL: Thanks.

BLITZER: Lou Dobbs getting ready for his program that begins right at the top of the hour. He's standing by to tell us what he's working on -- Lou.

LOU DOBBS, CNN ANCHOR: Wolf, thank you. Coming up at 6:00 Eastern, we'll be reporting on the latest on this deadly flooding throughout many areas of the Northeast. And as Governor Rendell said, it is getting worse.

Also, President Bush may be preparing to compromise on his proposals to give amnesty to millions of illegal aliens. The White House may actually be considering securing our borders. We'll be live at the White House with that report.

And the Bush administration simply can't resist putting commerce ahead of U.S. interests and free trade before national security. If you didn't like the Dubai ports deal, you will hate what the Bush administration has in store for us now. We'll have that report.

And in another great American giveaway, thousands of foreign workers could be brought into this country to do work that Americans aren't doing. We'll be telling you what the mayor of a small Mississippi town is considering. And the chairman of the Senate Judiciary Committee, Senator Arlen Specter, joins me tonight. He's holding hearings on whether President Bush has exceeded his constitutional authority. Senator Specter will be with us. We hope you will be as well.

Wolf, back to you.

BLITZER: Thanks very much, Lou. We'll see you in a few minutes.

Up ahead here in THE SITUATION ROOM, Jack Cafferty, has religion and politics become very much something on his mind? Should Democrats court evangelicals and other religious Americans, as Senator Barack Obama, among others, says? "The Cafferty File," that's next.

(COMMERCIAL BREAK)

BLITZER: There's a new addition to the fleet of U.S. spy satellites orbiting earth. Launched last night from California's Vandenberg Air Force Base, these eyes in the sky are usually kept under very tight wraps. But CNN got an exclusive look at one satellite while it was under construction. Our national security correspondent David Ensor is joining us now with what he saw -- David.

DAVID ENSOR, CNN AMERICA BUREAU CORRESPONDENT: Wolf, the nation spends tens of billions of dollars on spy satellites, and this was a rare chance indeed for the taxpayer to see what we get for our money.

(BEGIN VIDEOTAPE)

ADM. VICTOR SEE, U.S. NAVY: I'd much rather be putting my flight suit on.

ENSOR (voice-over): Navy Admiral Victor See (ph) is suiting up to take us into the clean room at a low-profile facility in California for a rare look at a government satellite under construction. Suits keep tiny particles on clothes from contaminating the satellite's complex electronics.

(on camera): It's a good size, isn't it?

SEE: It's about four stories tall when all put together and deployed in space.

ENSOR: Is that part of it, as well?

SEE: That is. That is the spinning section.

ENSOR (voice-over): This relay satellite is designed to capture pictures and signals from the nation's spy satellites and transmit them to ground stations. Officials won't give a precise number, but there are currently between 15 and 20 U.S. intelligence satellites up there in orbit. They are the nation's eyes and ears in space.

The National Reconnaissance Office designs, builds, and runs satellites that track everything from North Korean missiles and Iranian secret nuclear facilities to individual Al Qaeda fugitives high in the Pakistani-Afghan mountains. Just how good are they? Government officials won't say. Only outside experts will give you an estimate.

LOREN THOMPSON, LEXINGTON INSTITUTE: The really good ones, the high-resolution ones, can see details as small as four inches from over 100 miles away.

ENSOR: They are good. But the NRO director says Hollywood, from "Enemy of the State" to Tom Clancy movies, has completely exaggerated what they can do.

DONALD KERR, DIRECTOR, NATIONAL RECONNAISSANCE OFFICE: One of the biggest misconceptions is the idea that we can put a satellite over some point on the Earth and keep it there. The laws of physics are, in fact, immutable.

ENSOR: In fact, each satellite has only minutes to photograph an intelligence target. That's why the U.S. has a constellation of spy satellites amongst its many civilian ones. So do the Russians and the rest of the world.

Then there are the inactive satellites out there and the space junk. To avoid collisions, the new relay satellite will use its red boosters with their big silver fuel balls.

(END VIDEOTAPE)

ENSOR: National Reconnaissance Office officials say in the post- 9/11 world, every spy satellite they have is working flat out. Sources say they are also working to develop new types that can't be seen by adversaries and other types that can identify what's going on even underground -- Wolf.

BLITZER: Amazing stuff, David. Thanks very much. David Ensor reporting.

And only moments ago, NASA officiated its initial countdown to Saturday's launch of the space shuttle Discovery. You can track the mission every step of the way by going online. Our Internet reporter Jacki Schechner standing by with the latest -- Jacki?

JACKI SCHECHNER, CNN INTERNET REPORTER: Wolf, it's official. Here's the countdown clock, and we're now at 42 hours 6 minutes and 7 seconds until launch. Also available online on the Web site from NASA is video of the astronauts' arrival at the Kennedy Space Center.

Now, there are some questions about the safety of this mission. Two top officials at NASA have said that they disagreed with the idea of going ahead with the launch. But it's important to note that NASA has never calculated odds this sophisticated before, and they say in some ways, many ways actually, this mission is much safer than previous missions. Go to this interactive display at NASA. It'll show you what exactly has changed on the Discovery.

Now, part of the mission is going to be to test these new safety features and to do repairs at the international space station. It's a 12-day mission, and if the launch is scheduled as planned for Saturday, tune in to CNN, 3:00. We will have all the coverage for you then, Wolf.

BLITZER: Miles O'Brien will be here for that. Jacki, thanks very much.

More escalation in the tensions in the Middle East. Zain, what is the latest development?

VERJEE: Wolf, a situation developing from Ramallah. Israeli troops have arrested a member of the Hamas-led Palestinian government as Israel steps up pressure on Hamas to release a kidnapped soldier. Palestinian security officials, Wolf, are saying that the labor minister, Mohammed Barghouti, has been detained on his way to his village.

His village is just north of Ramallah. He was on his way there in his car, and he was stopped and asked to come out of the car, and apparently taken away. There has been no comment from the Israeli army, who doesn't comment on operations that are currently under way -- Wolf.

BLITZER: Zain, thanks for that.

Up next, Jack Cafferty wants to talk religion and politics. Should Democrats court evangelicals and other religious Americans as Senator Barack Obama suggests? "The Cafferty File" is next.

(COMMERCIAL BREAK)

BLITZER: Let's check in with Jack once again for "The Cafferty File" -- Jack.

CAFFERTY: Wolf, the question -- Senator Barack Obama says Democrats ought to court evangelicals and other religious Americans. The question we asked is, is he right about that?

Jerry writes in Holliston, Massachusetts, "Why not? The Democrats might as well sacrifice any remaining shred of decency they might have had and join the Republicans in pandering to religious groups, all the while destroying the very principles this country was founded upon. Jack, how can anyone in good faith say that religion should play a role in politics?"

Kim in Montgomery, Texas, "I agree with Barack Obama, although I am an atheist. Democrats need to appeal to everybody to keep Republicans out of office. Hopefully, forever and ever."

Robert writes, "Absolutely not. Why court people living in fantasyland when we need serious people to run this government? Faith is great and all, but it has no business in policy-making. Morals and ethics do. And you don't need to be an evangelical something-or-other to have those."

Ann in Michigan: "I'm an evangelical and a Democrat. There are many more of us out here than you might think. We've just had to go undercover of late because of the hostile environment in our evangelical churches. I would love to have the real issues that Christians care about like poverty and the environment addressed instead of just focusing on waving the flag and keeping gays from getting married."

Mary in Maryville, Tennessee: "He's right. But what's more important to a once-Republican -- the Bush administration managed to change my affiliation -- is that he not only talks but has rhetoric and votes my values. Religion is important to me and my family. Why the Democrats feel they must shy away from that fact is beyond my comprehension."

And Ger writes from Seaside, California, "I didn't see the part of the movie that says only Republicans are religious" -- Wolf.

BLITZER: He's an impressive guy, Barack Obama. I don't know if you've had a chance, Jack, to meet with him...

CAFFERTY: No.

BLITZER: ... but he's very intelligent. He's got a huge future in the political business, as they say.

CAFFERTY: If the Democrats are smart, he has a huge future. That's an open question.

BLITZER: Jack, see you in one hour back here in THE SITUATION ROOM. I'm Wolf Blitzer in Washington. Let's throw it to Lou. He's standing by in New York -- Lou.

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