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The Situation Room
Speculation Over Change In Strategy Regarding Iraq; Former Enron CEO Jeff Skilling Sentenced To 24 Years In Prison; Tennessee Senate Showdown Bitter and Bruising; Are Americans Disillusioned With Government Power?
Aired October 23, 2006 - 16:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
WOLF BLITZER, CNN ANCHOR: Ali, thanks very much.
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 today's top stories.
Happening now -- rethinking Iraq. Is the president staying the course or charting a new one 15 days before the election? It's 4:00 p.m. here in Washington. I'll speak to the secretary of state's top advisor on Iraq and we'll also have new poll numbers on voters' views of Iraq and whether it's a losing battle.
Also this hour, broken government. Most Americans give Congress a failing grade. What, if anything, can be done to fix the problem? We're helping to kick off CNN's week-long investigation.
And a new bombshell in the political ad war. Republicans targeting Democratic Congressman-turned Senate candidate Harold Ford Jr. Are they playing it for laughs or playing with fire?
I'm Wolf Blitzer. You're in THE SITUATION ROOM.
Up first this hour, a bloody October in Iraq and November 7th anxiety here in Washington. At least half a dozen Iraqis died today in insurgent attacks in Baghdad alone. Eight more bullet-riddled bodies were found scattered across the Iraqi capital. Right now, the U.S. death toll, the military death toll in Iraq has climbed to 2,799. Eighty-six troops were killed this month alone, making October already the deadliest month for America's armed forces in Iraq this year.
The rampant violence is weighing heavily on the White House. The secretary of state, Condoleezza Rice, and other senior members of the president's national security team met once again today, following a weekend of high-level talks on Iraq strategy. Fifteen days before America votes, the Bush administration is trying to sound more flexible about Iraq, while the public is sounding even more skeptical.
Our senior political analyst Bill Schneider is standing by with some brand new CNN poll numbers but let's start off our coverage with Suzanne Malveaux at the White House -- Suzanne.
SUZANNE MALVEAUX, CNN WHITE HOUSE CORRESPONDENT: Well, Wolf, there certainly was a big flurry after the meeting President Bush had with his top military brass on Saturday. A lot of discussion, speculation over whether or not there would be a change in strategy or course correction regarding Iraq.
Well, there were no announcements about increases or decreases of U.S. troops, but certainly a plan to push the Iraqis even further to take charge of the security situation as well as the government.
(BEGIN VIDEOTAPE)
MALVEAUX (voice-over): The White House denies it is secretly setting a timetable for U.S. troops to withdraw from Iraq as a weekend report in the "New York Times" suggests. But officials acknowledge the president's Saturday meeting with his top generals did involve setting a timetable for the Iraqis to take over their security and government.
DAN BARTLETT, COUNSELOR TO THE PRESIDENT: To ensure that we are adopting the right tactics and strategies to impress upon the Iraqi government to take more control of their own country.
MALVEAUX: The truth is, the distinction is largely semantic. President Bush has said repeatedly as soon as the Iraqis can protect themselves, U.S. troops will be able to come home.
NORMAN ORNSTEIN, AMERICAN ENTERPRISE INSTITUTE: When you set a timetable for Iraqi change, there's a threat implicit behind it and the only thing we've got to threaten them with is a withdrawal of American troops.
MALVEAUX: While the White House dismisses this, it is cautious about appearing to push Iraq's president too quickly or punishing the fledgling democracy.
TONY SNOW, WHITE HOUSE PRESS SECRETARY: We're not in the business of issuing ultimatums, and that part of it is inaccurate.
MALVEAUX: But the White House acknowledged it suspects Iraqi President Nuri al-Maliki to do much more in dismantling the militias by the end of the year, a goal the administration says Maliki shares.
The Bush administration is using its leverage to push the Iraqi leader to act urgently by emphasizing that international investments will only flow into the country once the violence goes down.
SNOW: You're not going to be able to do the kind of reconstruction you consider necessary until you've handled the security issues.
(END VIDEOTAPE)
MALVEAUX: And, Wolf, in an indication that the White House really is going out of its way to try to convince voters that it is flexible in its tactics regarding Iraq, Press Secretary Tony Snow today officially saying that the White House, the president, has abandoned the mantra to stay the course. We heard that in the president's last press conference. The president saying specifically saying, in his worse, "stay the course is only a quarter correct. Stay the course means keep doing what you're doing. My attitude is don't keep doing what you're doing if it's not working. Change" -- Wolf.
BLITZER: Suzanne Malveaux at the White House, thanks very much.
Ali Velshi is watching a developing story for us.
Ali, the sentencing has now come in?
ALI VELSHI, CNN ANCHOR: We're getting our own confirmation on this, but the Associated Press is reporting that Judge Sim Lake has sentenced former Enron CEO Jeff Skilling to 24 years in prison on his conviction of 19 counts that you will remember was handed down on May 25th in Houston.
In that same courtroom -- and those are pictures of Jeff Skilling as he came into the court today to face his sentencing. He was escorted by mounted police and security. He is facing now 24 years, which is at the lower end of the range that he was expected to face. Some thought he could get up to 40 years.
You will remember that he was convicted on 19 counts, Wolf, of fraud, conspiracy, insider trading and lying to auditors in his role in the collapse of Enron. He was said to be the smartest guy -- well, one of the smartest guys in the room. That was the title of the book and the movie.
Jeff Skilling facing 24 years in prison. There is going to be an appeal in this. We are also waiting to see how much money he's going to have to hand over. It was going to be in the tens of millions of dollars.
We'll bring you that as we get it, Wolf.
BLITZER: All right, we'll continue to watch this story. Ali, thanks very much. Ali Velshi reporting for us.
Let's get back to our top story, Iraq and the public's increasingly gloomy view of Iraq and the possible fallout on election day.
Let's go to our political analyst Bill Schneider. He has got some brand new poll numbers -- Bill.
WILLIAM SCHNEIDER, CNN SR. POLITICAL ANALYST: Wolf, there's a phantom candidate in every election called expected. It's not enough to win. You have to do better than expected.
(BEGIN VIDEOTAPE)
SCHNEIDER (voice-over): Bad news from Iraq, Afghanistan, North Korea, and Iran are taking a toll. Only 20 percent of Americans now believe the United States and its allies are winning the war in Iraq, half as many as last December. The number who say they're satisfied with the way the war on terrorism is going has dropped to 40 percent, the lowest level ever.
Republicans are asking can you really trust the Democrats?
GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: I view this as a clarifying moment for the country, a chance for Republicans, Democrats and independents to learn firsthand the differences of opinion we have in Washington, D.C.
SCHNEIDER: OK. Which party would do a better job dealing with corruption? Democrats have an 18-point lead. Iraq? Democrats by 11 points. Republicans continue to have the advantage on terrorism, although it has narrowed to six points.
SEN. CHARLES SCHUMER (D), NEW YORK: They're sort of in a little room and all the exits are closing. The security exit is closing because Iraq is a mess. The domestic policy exit is closing because the middle class is being squeezed. And now even the values exit is closing because they've so mishandled the Mark Foley problems.
SCHNEIDER: Most Americans believe the Democratic Party shares their values. Most believe the Republicans don't. Democrats are feeling cautiously optimistic.
UNIDENTIFIED MALE: I feel good.
SCHUMER: We are really feeling very, very good.
UNIDENTIFIED MALE: Good morning.
SCHNEIDER: The first President Bush speculated that his son might have to learn what to do if the Democrats win control of Congress. Hint -- ask your dad!
BUSH: He shouldn't be speculating like that because he should have called me ahead of time, and I tell him they're not going to.
SCHNEIDER: Expectations for Democrats are rising. Most Americans believe the Democrats will take control of the House of Representatives. And by a very narrow margin, maybe even the Senate.
(END VIDEOTAPE)
SCHNEIDER: That could be a problem for Democrats. If they gain seats but don't win a majority, it could look like a defeat for Democrats. They will have done worse than expected -- Wolf.
BLITZER: Bill Schneider reporting for us.
And one more noteworthy poll number. Our new survey puts President Bush's job approval rating now at 39 percent. That's up three points from mid-October. That brings Mr. Bush back to where he was in our two previous surveys.
In the final two weeks before Election Day, the gloves clearly are coming off in some of the most critical matchups. The Tennessee Senate race specifically, a very striking example. An eye-popping new ad and a close encounter between the candidates are making that showdown even more bitter and bruising. Let's bring in our senior political correspondent, Candy Crowley.
Candy, what a race it's shaping up to be.
CANDY CROWLEY, CNN SR. POLITICAL CORRESPONDENT: It's a great race. I mean, you know that there are 33 Senate races this year, but some are a lot more fun to cover than others.
(BEGIN VIDEOTAPE)
CROWLEY (voice-over): You don't need polls to tell you when a race is close. In Tennessee, a parking lot will do.
BOB CORKER (R), TENN. SENATE CANDIDATE: It's true sign of desperation that you would pull your bus up when I'm having a press conference.
REP. HAROLD FORD JR. (D), TENN. SENATE CANDIDATE: No, sir. I can never find you anywhere in the state.
(CROSSTALK)
CORKER: I was in Jackson last night.
CROWLEY: Welcome to the Tennessee Senate smackdown. Screen left, Democrat Harold Ford who tried to crash a press conference held by screen right, Republican Bob Corker.
CORKER: As a matter of fact, this is my press conference, not yours, OK?
FORD: I'd love to hear you talk about Iraq, though.
CROWLEY: They don't like each other much, but mostly they are radiating the heat of a pivotal race. There are no last words, just the next ones.
FORD: What kind of a man attacks another man's family in the face of a campaign? I'll tell you the kind of man. His name is Bob Corker.
CORKER: I've never said a negative word about his family. He came in, in almost a juvenile fashion, and crashed a press conference on Friday. It's been called the "Memphis Meltdown" and he just got through saying a load of non-truth.
CROWLEY: This is nastier than most because it's not just about winning this race, it's about who will control the U.S. Senate.
Republicans are trying to build a firewall. If you weed out probably four seats that look ready to fall, there are three must-wins if Republicans to keep majority status in the Senate: Virginia, Missouri and Tennessee. Money is pouring into this state like a Niagara Falls of the South. Some of it in ads, including this beauty.
UNIDENTIFIED FEMALE: I met Harold at the Playboy party!
UNIDENTIFIED FEMALE: I'd love to pay higher marriage taxes.
UNIDENTIFIED MALE: Canada can take care of North Korea. They're not busy.
UNIDENTIFIED MALE: So he took money from porn movie producers? I mean, who hasn't?
CROWLEY: Even if this brawl, that's rough.
UNIDENTIFIED FEMALE: The Republican National Committee is responsible for the content of this advertising.
UNIDENTIFIED FEMALE: Harold, call me.
FORD: And I think my opponent has gotten very nervous and skittish. And this isn't the first ad in the gutter.
CROWLEY: Not that Ford hasn't thrown some punches in the air, but even Corker says his party's ad is over the top.
CORKER: We think the ad is tacky. We think it's not Senatorial, we think it has no place in this race.
CROWLEY: The ad is still playing.
Did we mention this race is close?
(on camera): And Wolf, as you know, this is not just about winning the majority. This is also about history here. If Harold Ford should win this Senate seat, he will become the first elected African-American from the South to get into the Senate.
BLITZER: I heard Ron Brownstein of the "Los Angeles Times", the political analyst, suggest yesterday that this ad was especially rugged in the South, because it has this white woman from the Playboy bunny or whatever making these comments about Harold Ford, Jr., an African-American, raising the specter of white women, black men in the South. And he suggested that this is going to backfire on the Republicans.
CROWLEY: Well, you know, it's possible. I mean, absolutely, when you look at the racial overtones of the race simply being, that there's never been an African-American elected from the South to sit in the Senate. Those from reconstruction were elected within their own state legislature.
So, you know, absolutely. But there's always that question out there, which we ask from the very beginning, will voters in Tennessee send an African-American to the Senate? So everything has a racial overtone. So we'll see if people caught that or if we're talking about a Tennessee that has changed. We're just not sure.
BLITZER: All right. We'll see what goes on. What an ad that is, though. And it's still airing as far as you know? CROWLEY: Yes, absolutely, yes. We called today with Republicans, they said, no, it's still on the air.
BLITZER: Candy, thank you very much.
Candy Crowley, Bill Schneider, Suzanne Malveaux, they're part of the best political team on television.
And remember, for all of the latest campaign news at any time, check out the CNN political ticker at CNN.com/ticker.
Jack Cafferty has the day off. He'll be back on Wednesday.
Up next though, the "CNN Election Express" deep in the heart of Texas, where a normally red district may turn a shade of blue. We're going to find out what's going on.
And are you satisfied with the job Congress did this year? Our new poll numbers may surprise you.
Plus, the deadly situation in Iraq. I'll speak with the Secretary of State Condoleezza Rice's top adviser on Iraqis, just back from nearly a year in Baghdad. He'll be here in the SITUATION ROOM.
We'll be right back.
(COMMERCIAL BREAK)
BLITZER: In southern Texas Tom Delay is not running for Congress for the first time in more than two decades. But the former Majority Leader is casting a big shadow over the complicated race to fill his longtime House seat.
Our national correspondent Bob Franken is in Sugar Land, Texas with the "CNN Election Express" -- Bob.
BOB FRANKEN, CNN CORRESPONDENT: As you can see, the Express is by the Sugar Land City Hall here in the state of Texas for a campaign, Wolf, that is in a state of confusion.
(BEGIN VIDEOTAPE)
SHELLEY SEKULA-GIBBS, (R) TEXAS, WRITE-IN CONGRESSIONAL CANDIDATE: I'm Shelley Sekula-Gibbs and I'm running for Congress.
FRANKEN: Houston City Councilwoman Shelley Sekula-Gibbs was recruited to replace Tom Delay with little delay, but too late for her name to get on the ballot, not the one for the next two years in Congress.
NICK LAMPSON, (D) TEXAS, CONGRESSIONAL CANDIDATE: I'm Nick Lampson. I'm running for the U.S. House of Representatives.
FRANKEN (voice-over): Democrat Nick Lampson won his spot on the ballot the old fashioned way in the primary.
SEKULA-GIBBS: It is not hard.
FRANKEN: Sekula-Gibbs is listed in a special election called to finish out the weeks left in Delay's unfinished term. The problem, the special election is the same day as the general election. Her paid T.V. message, vote twice.
SEKULA-GIBBS: First vote for me in the special election, where my name will appear on the ballot, then in the general election on the same ballot, write me in.
FRANKEN (on camera): Does it make any sense to you at all?
UNIDENTIFIED MALE: No.
FRANKEN: Do you understand this at all?
UNIDENTIFIED FEMALE: I don't.
UNIDENTIFIED FEMALE: No, I don't.
FRANKEN: What do you do?
UNIDENTIFIED FEMALE: I don't know. It is a quandary. It really is.
What do you suggest?
FRANKEN (voice-over): Someone suggested to Sekula-Gibbs she should have a jingle.
UNIDENTIFIED FEMALE: Vote twice for Shelley, special and then write her in.
FRANKEN: Lampson, the Democrat, he's staying off the ballot where Sekula-Gibbs does appear.
LAMPSON: The special election is something that turned out to be very confusing and I chose not to be a part of it.
FRANKEN: Although it's considered to be leaning Democratic this time, the indications are that's because of the ballot confusion, not all the problems weighing down Republicans nationally. In fact, the party heavyweights have been campaigning in the area, even Delay. But Sekula-Gibbs feels she needs to sing for her support.
UNIDENTIFIED FEMALE (singing): ... can you do it and then we'll win.
(END VIDEOTAPE)
FRANKEN (on camera): Well, both sides, Wolf, are predicting victory on November 7th, but after the election one side or the other will be singing a different tune.
BLITZER: All right Bob. Thanks very much.
Bob, you're going to continue reporting from Texas in the coming days.
Up next do you think Congress did a good job this year, or do you think lawmakers should get an F? Our new poll numbers are only moments away. You're going to want to see this.
Plus, Barack Obama for president? If the junior senator from Illinois jumps into the race for the White House, does he have a really good chance to win? I'll ask Paul Begala and J.C. Watts. They're standing by live in today's "Strategy Session".
Stay with us. You're in the SITUATION ROOM.
(COMMERCIAL BREAK)
BLITZER: New evidence that Americans are disillusioned with government and sour on the United States Congress, attitudes likely to influence their votes on November 7th.
Look at this. Our new CNN poll shows more than three-fourths of Americans, 78 percent believe our system of government is broken. And just 13 percent of Americans say they're satisfied with what Congress has accomplished this year.
Most, 85 percent, yes, 85 percent say they wish Congress had done more. All this week on CNN, the best political team on television is investigating what's wrong with our government in an unprecedented series of nightly specials.
(BEGIN VIDEOTAPE)
BLITZER: Monday, Ed Henry looks at what critics charge is "Our Do Nothing Congress."
ED HENRY, CNN CORRESPONDENT (voice-over): Congress has become the Tuesday through Thursday club, with lawmakers enjoying a work schedule most Americans can only dream of, pulling in $165,000 for what has essentially become a part-time job.
BLITZER: Tuesday, Candy Crowley digs into why Democrats seem to have so much trouble winning elections.
DAVID SAUNDERS, DEMOCRATIC STRATEGIST: There are certain Democrats who cannot win in rural America.
CROWLEY: Are they the "L" word?
SAUNDERS: No, they're not the "L" word. They are the "N word for naive. They might even be the "N" word for ignorant.
BLITZER: Thursday, John King takes a look at how powerful the president has become in the post 9/11 world.
JOHN KING, CNN CHIEF NATIONAL CORRESPONDENT: No search warrant, no arrest warrant. Enemy combatant was his designation and he would seen realize there were others, that his captors wanted information and that they were impatient. MOZZAM BEGG, FORMER DETAINEE: Dragged across the floor, thrown on the ground, our clothes were ripped off with knives with several soldiers sitting on top of us, kicked, punched, beaten, sworn at, spat at, dogs were barking around us. We were photographed naked and then dragged naked and shivering into interrogation rooms where the first questioning began.
BLITZER: Friday, Jeff Greenfield will examine how the Republican Party seems to have lost its way.
ANDREW SULLIVAN, CONSERVATIVE COLUMNIST: A lot of conservatives are saying, I think, look, the problem is too much power, too long, corruption. What we need is divided government for a while to try and put a check against this unrestrained power and corrupt power.
BLITZER: Finally, next Saturday, Jeff Toobin explores the tangled relationship between politics and the judiciary.
UNIDENTIFIED MALE: This is a horrible decision.
UNIDENTIFIED MALE: This court doesn't seem to understand the unintended consequences.
UNIDENTIFIED MALE: Reign back in this broad interpretation.
UNIDENTIFIED MALE: Congress has to respond to this. We cannot let the courts step in.
SANDRA DAY O'CONNOR, FORMER SUPREME COURT JUSTICE: We saw legislation introduced to somehow restrict or affect judges at both the state and federal levels and even public opinion polls about courts and judges showed an increase in dissatisfaction with the American public.
(END VIDEOTAPE)
BLITZER: You're going to want to stay with CNN in primetime all this week for our series on broken government. They air at 8:00 p.m. Eastern. On Wednesday, though our series begins an hour earlier at 7:00 p.m. Eastern with a Lou Dobbs: Broken Borders special. He will be live from San Antonio, Texas. You're going to want to see this all this week.
Up next, will the war in Iraq be the deciding factor in the battle for Congress? Paul Begala, J.C. Watts standing by to answer that question.
Plus, can Barack Obama beat out Hillary Clinton for the Democratic presidential nomination? That's coming up today as well in today's "Strategy Session." We'll be right back.
(COMMERCIAL BREAK)
BLITZER: Welcome back to THE SITUATION ROOM, I'm Wolf Blitzer in Washington. Let's bring in our Zain Verjee, she's back from a major trip, a major assignment covering the secretary of state. What Zain, you went to Japan, South Korea, China, Russia, all in a few days. Did you know what day it was?
ZAIN VERJEE, CNN CORRESPONDENT: No, Wolf, I had to keep track. But the best part was that I didn't have to deal with luggage or passports.
BLITZER: You did an excellent job for us Zain, thanks very much.
VERJEE: Thanks, Wolf.
Let's take a look at the headlines.
Construction at the World Trade Center will continue despite the discovery of apparent remains of 9/11 victims. That's the word from New York Mayor Michael Bloomberg. Remains were found near the site in recent days. Some of the victims family members demanded that officials halt construction. But Bloomberg said this morning the work will go ahead as scheduled.
Hurricane Paul is weakening as it heads towards the southern tip of Mexico's Baja California peninsula. Paul is now a Category 2 storm. Forecasters say it will pass near the resort town of Cabo San Lucas sometimes -- some time today, before hitting the Mexican mainland. No evacuations are planned.
A shocking claim by Iran's president -- he said today Iran's nuclear capability has increased 10-fold over the last year, despite Western pressure to roll back its nuclear program. Now, he didn't elaborate. The remarks appeared aimed primarily at rallying public support. The U.N. Security Council is now preparing to consider a draft resolution imposing limited sanctions on Iran, because of its refusal to hold uranium enrichment.
And it's a violent day in northern Gaza. Israeli troops killed seven Palestinians today. The victims include a militant commander involved in rocket attacks on Israel and three of his relatives. This is one of the bloodiest days of fighting since the four-month Israeli offensive in the Gaza Strip began. The attack has prompted Palestinian calls for revenge -- Wolf.
BLITZER: Thanks, Zain, very much.
In our "Strategy Session": rising voter anxiety about Iraq and the war on terror, two weeks before America votes. And looking ahead to 2008, Democratic Senator Barack Obama opens the door to a presidential bid.
Joining us now, our CNN political analysts, Democratic strategist Paul Begala, and former Republican Congressman J.C. Watts.
J.C., let me show you these poll numbers in our brand-new CNN poll. Is the U.S. winning the war in Iraq? It's at the lowest point ever, since we have been asking this question, since the start of the war, back in 2003. Only 20 percent of the American public now think the U.S. is winning this war, down from 25 percent in September, 31 point back in February. Almost a year ago, it was at 40 percent.
The American public is not very happy about this.
J.C. WATTS, CNN POLITICAL ANALYST: Well, Wolf, and I don't think the American public will be happy about it, when you continue to see the benchmark being money spent and Americans' lives lost.
And I think that has kind of framed the -- the war in Iraq, instead of kind of being on the offensive. And, again, I -- I'm sounding like a broken record, but, you know, the administration comes out here about a month ago, and they -- they -- they go on the offensive concerning the war, and they talk about it for about a week. Then, we hadn't heard from them in three weeks.
And, again, the benchmark becomes money spent and American lives lost. And I don't think that's good for the freedoms and -- and battling terrorism here at home.
BLITZER: Yet, surprisingly, in this new poll, Paul, when we asked the question, "Which party does a better job when it comes to fighting terrorism?" back October 6 through 8, 45 percent to 40 percent for the Democrats. But look at this. It has flipped: 48 percent to 42 percent now for the Republicans.
How do you explain that?
PAUL BEGALA, CNN POLITICAL ANALYST: It kind of waxes and wanes. In any case, that is bad for the Republicans. They need to lead by 20, 30, 40 points on terrorism to have any hope at all of -- of winning in these midterm elections.
And the problem is, they have squandered that advantage, in the eyes of the voters, less because of anything, frankly, the Democrats have done, and more because of the growing sense in the country that they have not...
BLITZER: Which is a...
BEGALA: ... been competent in the war on terror.
BLITZER: ... more of a significant issue right now going into the election, the war in Iraq or the war on terrorism?
BEGALA: Well, Iraq more than terrorism.
But the president has tried to conflate the two. And, unfortunately, for him, what has happened is, they're -- the voters' general approval of the war on terror has been dragged down by their strong disapproval of the war in Iraq. The president thought he could leverage the one to help the other. And it actually worked the other way.
Iraq is a mess. People want a new direction. Had the president fired Don Rumsfeld six months ago, even with similar policies and similar disastrous blood on the streets, he might be in a stronger political position today.
(CROSSTALK) WATTS: Wolf, I don't believe that those numbers are necessarily saying that they don't agree with the war in Iraq, or that they don't agree with us fighting this battle against terrorism. And I'm not so sure they're trying to separate Iraq and -- and -- and the war against terrorism.
I think the important thing to note is, again, they don't know if we're winning or losing, because we're not talking to them. We're not communicating. We're not talking about a -- a -- a tangible, clear strategy on what we're doing, how we're doing it.
BLITZER: Right.
As you say, the American public sees a lot of dead Americans, and $300 billion, $400 billion, and growing. And, so, they're worried about that.
But let's move on. I want to talk a little bit about Barack Obama. The junior senator from Illinois, he was on "Meet the Press" yesterday. And he clearly opened the door to a possible presidential run.
Listen to this.
(BEGIN VIDEO CLIP, "MEET THE PRESS")
SEN. BARACK OBAMA (D), ILLINOIS: My main focus right now is in '06, and making sure that we retake the Congress.
After -- after November 7, I will sit down, and -- and consider it. And if, at some point, I change my mind, I will make a public announcement, and everybody will be able to go at me.
(END VIDEO CLIP)
BLITZER: As you know, earlier, he had flatly ruled it out. But now he is clearly opening the door, saying he is thinking about it.
What do you think?
BEGALA: I think he's telling the truth. I think he has not made up his mind. I have talked to people close to him.
By the way, neither has Senator Clinton, who is on the ballot this November to be reelected in New York. And I know all of us want to get out ahead of it. But I think the -- politically, the way Senator Obama handled this yesterday was very wise. He just told the truth.
He said: Look, I know I said that nine months ago, but now things have changed. Everywhere he goes, he is the voice of hope for Democrats right now. He's -- he's being treated as he should be, like a rock star. And he's under enormous pressure to run. Everywhere he goes, people say, run, Barack, run.
So, he just told the truth. I thought it was a very smart thing to do.
BLITZER: What do you think?
WATTS: We have never had a President Obama. President Obama. And that's a good ring to it.
I -- I think he is going to run, Wolf. I -- I -- I have talked to some people who's in his inner circle that said that he is telling people to keep their powder dry. You know, don't make any early commitments.
I -- you know, it's going to be very attractive to him, and it's going to be difficult for him not to run.
BLITZER: Let me read...
WATTS: I think now is a good time.
BLITZER: Let me read to you what Bob Herbert, the columnist for "The New York Times," wrote today in a -- in a column entitled "The Obama Bandwagon: "Republicans would like nothing more than for the Democrats to nominate a candidate in 2008 who has a very slender resume, very little experience in national politics, hardly any in foreign policy, and who also happens to be black. The Republicans may be in deep trouble, but they believe they could pretty easily put together a ticket that would chew up Barack Obama in 2008."
What do you think of that?
WATTS: Well, Wolf, let me tell you, at the end of the day, at the end of '08, after the Wednesday after the first Tuesday on Election Day November 2008, if we have got states that are more red and states that are more blue, our nation is going to pay a price for that.
And I think there's two or three people out there that could make some pretty interesting candidates, Barack Obama on the Democrats' side, John McCain on the Republicans' side, Bill Richardson on the Democrats' side.
There are some people out there that could make blue states less blue and red states less red. And I remind you, Bill Clinton didn't have a very deep resume, and he became president. So, I -- I'm not so sure the American...
BLITZER: All right.
WATTS: ... people are going to...
BEGALA: But he had a stronger political resume. He had no foreign policy experience. And -- and, you know...
BLITZER: He had been governor of a state.
BEGALA: He had been governor of a state for 12 years. And each two -- every two years for most of that term, he was running in an election. I think this is the thing that Democrats are a little nervous about. Senator Obama has won a state Senate seat in Illinois and a U.S. Senate seat against Alan Keyes, who basically collapsed, who didn't even live in the state, and just collapsed. He -- he had very little primary and he had almost no general election challenge.
And, so, there is a worry that he has been untested in politics. And, believe me, he knows that. Obama knows that. And, so, he is trying to figure this out himself.
(CROSSTALK)
WATTS: Well, I -- I think the American people are wanting somebody that will challenge us to think about what we want to be as a nation when we grow up. He does that very well.
BLITZER: We got to leave it right there, guys. We will continue this discussion, I'm sure, many, many times down the road.
Paul and J.C., thanks very much.
And, as our viewers know, Paul Begala and J.C. Watts are part of the best political team on television.
And, remember, for the latest campaign news at any time, check out our Political Ticker. Go to CNN.com/ticker.
Coming up: the power struggle in statehouses across America. Election Day could bring a major shift. Jeff Greenfield standing by -- he will examine the states and the stakes.
And is Senator Hillary Clinton's reelection campaign getting ugly? We're going to tell you about some not-so-pretty comments attributed to her Republican rival.
Stay with us. You're in THE SITUATION ROOM.
(COMMERCIAL BREAK)
BLITZER: On our "Political Radar" this Monday: Senator Hillary Clinton's Republican challenger is denying he made some ugly remarks about the way she used to look.
But "The New York Daily News" is standing by its report that John Spencer said -- and I'm quoting now -- "You ever see a picture of her back then? Whew. I don't know why Bill married her."
The Daily News reports, Spencer went on to suggest that Senator Clinton had -- his words -- millions of dollars of -- quote -- "work" to help improve her appearance. Spencer's spokesman denies the newspaper's account. A Clinton political adviser says the story shows Spencer is -- quote -- "unfit for the U.S. Senate."
In California, GOP congressional candidate Tan Nguyen is blaming his opponent for the uproar over intimidating letters his campaign sent to Hispanic voters. Nguyen is resisting calls from fellow Republicans to drop out of the race. And he has been criticized by the state's top Republican, Governor Arnold Schwarzenegger.
But Nguyen is accusing Democratic incumbent Loretta Sanchez of fueling the hysteria over the letter, which he says he did not personally approve. And he charges, Sanchez is behind a state investigation now under way into possible voter intimidation by his campaign.
In the New Jersey Senate race, a new poll may be providing new optimism for the incumbent senator, Democrat Bob Menendez. The Monmouth University/Gannett survey shows Menendez now leading Republican challenger Tom Kean Jr. by nine points. Kean had an eight- point lead in that same survey back in September. We will have a full report on this critical showdown in New Jersey in our next hour here in THE SITUATION ROOM -- Mary Snow is New Jersey covering that race for us.
In the battle for Congress, the Democrats need to pick up six seats to win control of the U.S. Senate. And they need to gain 15 seats to seize control of the House of Representatives. But, across the nation, nearly 6,000 seats are at stake in the state legislators -- legislatures -- and those contests could have a dramatic impact on who is in charge of Capitol Hill in the years to come.
Let's bring in our senior analyst, Jeff Greenfield. He is watching this for us.
Why -- why does it really matter, Jeff? Because we're paying a lot of attention to the House. We're paying a lot of attention to the Senate. We're not necessarily paying a lot of attention to these state races. Why are they so important?
JEFF GREENFIELD, CNN SENIOR ANALYST: Well, it matters because, if a party controls the state legislature and the governorship in a state, that party pretty much has total control over how congressional districts are drawn, as long as they're roughly equal in population, and they meet to test of racial fairness. So, they can be drawn to maximize the political clout of one party and minimize the other.
The most recent example, of course, is in Texas. Once the Republicans got control of the state in 2002, they redrew the boundaries of their congressional districts, at the urging of then House Majority Leader Tom DeLay. They moved Democrats out of marginal districts, moved Republican voters in. And the result in 2004 was that five more Republicans wound up in the House.
Now, the fact that this was this done in between the 10-year federal census made it very controversial. But, Wolf, the idea is hardly new.
BLITZER: Well, it's hardly new, because gerrymandering, as it's called, that has been around for a very long time.
GREENFIELD: Yes. Quite literally, it's about as old as the country.
Elbridge Gerry -- or Gerry, if you prefer -- was the Massachusetts governor back in 1810 who ordered the districts drawn -- redrawn to help his party. One looked so weird that a critic said it look like a salamander. No, another said, a gerrymander. And the term was born.
It is an old, if not particularly noble tradition. Back in the 1980s, a California congressman, Phil Burton, who was a genius at this sort of thing, presided over a redrawing of lines that gave the Democrats six additional seats in the U.S. House.
But, since then, the -- the whole use of computer technology and data retrieval has made it possible to draw these lines literally almost block by block to help or hurt a party.
Right now, Republicans are in total political control of 12 states and Democrats in eight. But it appears that Democrats have a chance to control eight or more additional states. And that may help explain why the two parties are spending nearly $25 million, and there's millions more from outside sources coming into to win these state legislative battles -- Wolf.
BLITZER: It still seems pretty hard to believe that these races, which are so below the "Political Radar" for so many people out there, including a lot of political news junkies, could have this kind of dramatic effect.
GREENFIELD: That's true.
I mean, the Senate races, in particular, and the governor races, get more attention. But here is one way to measure this. By one calculation among Democrats, if you look at the -- some 6,000 seats that are up for grabs across the states, if Democrats can just win 50 of them in the right states, that could lead to a potential gain of 15 seats in the House of Representatives, which, as we have been saying quite often, happens to be exactly the number Democrats would need this November to take over that body.
There is also an issue, we should say, that goes beyond which party holds power. Quite often, the two parties will agree to draw lines for one big purpose. And that is to protect incumbents. California Governor Schwarzenegger, who wanted to put the process in the hands of a nonpartisan commission, often noted that, in 2004, the incumbents of both parties were so good at protecting themselves -- surprise, surprise -- that not a single seat in the California Assembly or State Senate or the 53-seat congressional delegation changed hands.
So, there's an issue of fairness. And, lastly, Wolf, there's a really nice irony here. Democrats in California worked very hard, and successfully, to defeat Schwarzenegger's idea. Had it been in effect this November, the thinking is, Democrats might have been able to pick up three or four more House seats just from California, just from the way those lines might have been drawn -- Wolf.
BLITZER: We are going to watch all these races together with you, Jeff. Thank you very much.
And, up next: an insider's view of the Bush administration's strategy sessions in Iraq. We are going to speak live with one of the top Iraqi advisers to the secretary of state, Condoleezza Rice. That would be Ambassador David M. Satterfield. He is just back from Baghdad, spent almost a year there. We will get his eyewitness account of what is going on right now.
Stay with us. You're in THE SITUATION ROOM.
(COMMERCIAL BREAK)
BLITZER: With Iran awash in violence and bloodshed this October, the Bush administration is holding high-level talks on its Iraq strategy. And it's trying to show a new willingness to be flexible, but how flexible? And how hard will President Bush actually push the Iraqi government to meet so-called benchmarks for success?
Joining us now, the senior adviser on Iraq to the secretary of state, Condoleezza Rice, ambassador David Satterfield.
You're just back from almost 16 months in Iraq. You saw the situation up close and very, very personal. I assume you're back -- glad to be back here in Washington, where there are other pitfalls, beyond the dangers of working in -- in Baghdad.
One of your colleagues, Alberto Fernandez, an Arabic speaker, was on Al-Jazeera the other day. And he said this, according to our translation. He was speaking in Arabic: "We tried to do our best, but I think there is much room for criticism, because, undoubtedly, there was arrogance, and there was stupidity from the United States in Iraq."
Now, he's come -- come to apologize for those remarks. But, as you know, a lot of people believe there was a lot of arrogance going into this war and a lot of stupidity.
AMBASSADOR DAVID SATTERFIELD, SENIOR ADVISER TO SECRETARY OF STATE CONDOLEEZZA RICE: Well, Wolf, we don't agree with those remarks.
Mr. Fernandez has expressed his own regret for having made them. This administration assesses constantly how to respond, how best to adapt to changing circumstances in Iraq. We don't underestimate the seriousness or the complexity of the situation, as it affects us, as it affects the Iraqi people themselves, who are the prime victims, the prime sufferers from this.
But arrogance, stupidity? No.
BLITZER: Because it's -- it's clearly more dangerous today than it was when you got there 16, 17, 18 months ago. It did not improve during your tenure in Baghdad.
SATTERFIELD: Well, Wolf, the fundamental nature of the threat has changed. The threat has moved from an insurgency, with two different extreme wings, Baathists and Saddamists on the secular side, al Qaeda on the religious extremist side, into something very different, and, frankly, much more threatening. And that is sectarian violence, sectarian killings, primarily in Baghdad.
BLITZER: Why did it get so bad? Because a lot of people, including Republican Senator Arlen Specter -- he was on "LATE EDITION" on CNN yesterday -- he now says, flatly, this is a civil war.
Listen to what -- what he also says. Listen to this.
(BEGIN VIDEO CLIP, "LATE EDITION WITH WOLF BLITZER")
SEN. ARLEN SPECTER (R), PENNSYLVANIA: We have James Baker saying that there are alternatives, besides staying the course and cutting and running. And I don't believe that a shift in tactics ought to wait until after the election. There are too many casualties there. If we have a better course, we ought to adopt it sooner, rather than later.
(END VIDEO CLIP)
BLITZER: Now, you were there at that strategy session at the White House on Saturday, when the president was briefed by his military commanders. A lot of people say, you know what? If there has to be a major change, don't wait until after the election. If it can save the lives of American troops and others, do it right now.
Is a major shift in strategy in the works right now?
SATTERFIELD: Wolf, we're assessing. And we have been assessing for some time, in the form of the consultations that the president undertakes with his senior military commanders and political advisers, both in Baghdad. We went through these when I was there, as well as with his staff in Washington. What's the situation? What's the threat? What's the challenge? How best to respond?
We try to adapt on a continuous basis to this. And I would -- would steer away from the idea of dramatic, radical changes, but to more adjustments and strategy to cope with the changing situation on the ground. And...
BLITZER: Is -- is Nouri al-Maliki, the prime minister of Iraq, the guy who can do this? Because a lot of people are losing faith in this guy, his alliances with Ayatollah Ali al-Sistani, with Muqtada al-Sadr, this young cleric who hates America, wants us out of there. And -- and he's making deals with them. He's flying off to their headquarters, and -- and basically doing a lot of what a lot of experts suggest is their dirty work.
SATTERFIELD: Well, the message that Prime Minister Maliki has expressed to his people, to us and to many of those same interlocutors you just named is a national message. It's the need for an end to violence. It's the need, in the case of Iran, for an end to outside intervention. BLITZER: But does he have the guts to do this, because he's dependent on these guys for his political base in the Iraqi parliament?
SATTERFIELD: The president talked to Prime Minister Maliki Friday before last.
And, in that call, the prime -- the president affirmed our support for the prime minister, as he acted as a national leader and led Iraq. Now, that's the challenge, Wolf. And it's a very serious one. Can the Iraqis bring themselves out of the current situation? The answer to that will depend not just on what we do, but on what they do.
BLITZER: How much time does he have, Nouri al-Maliki, the prime minister, to show the United States, the world, that he can crack down on these death squads, on these militias, and get the job done? Because, in the meantime, a lot of Americans are dying, and we're spending billions of dollars every month.
SATTERFIELD: A lot of Americans are dying and a lot of Iraqis are dying. A lot more Iraqis are dying.
Progress needs to be made as rapidly as possible on security, on reconciliation and political process. Is there a timeline? I can only tell you that, the longer things go on, while this killing and violence increases, while sectarian divisions increase, the more difficult it makes it for the Iraqis, for us, for all the friends of democracy and peace in Iraq, to see this through to success. Action needs to be prompt.
BLITZER: Will there be a change before the election, you think?
SATTERFIELD: We will take whatever steps are necessary as soon as possible to help address the situation. The elections are not a factor in this at all.
BLITZER: Ambassador David Satterfield, good to have you back here in Washington. Thanks very much for coming in.
SATTERFIELD: Happy to be with you.
BLITZER: Thank you. Good luck to you and your entire team over at the State Department.
Coming up: A congressman takes on CNN for a controversial report from Iraq. Critics call it insurgent propaganda. CNN stands by its difficult decision to report the news. I will speak with one of the critics of that decision, the chairman of the House Armed Services Committee, Duncan Hunter. He is standing by to join us live.
We will be right back.
(COMMERCIAL BREAK)
BLITZER: Sixty-three million people went online for political news in 2004, a number expected to increase this election season.
Now some liberal bloggers are trying to manipulate the popular search engine Google to impact what voters will read about Republicans on the Web. But will this controversial tactic actually work?
Let's bring in our Internet reporter, Jacki Schechner -- Jacki.
JACKI SCHECHNER, CNN INTERNET REPORTER: Wolf, it's an interesting strategy.
If I want to learn more about a lawmaker, I can go to Google.com and plug in his or her name. And, most likely, the first result I get will be his official Web site. I will also get other news and information. And the more popular a link is, the higher up it will be in my search result.
Well, there is one liberal blogger, Chris Bowers of mydd.com, that is using his blog and other top liberal blogs to get his readers to find the most negative article they can about 70 different Republican candidates, and then link to that article a lot, so that, when people go online to search for information about these candidates, they will most likely see that negative news article.
It's a process called Google bombing. And it's something that Google is well aware of. They frown on the process. They say that it takes away from the organic, real search results. And it's doable if you have enough people and you know how the search engine works.
Conservatives, obviously, are critical, some calling it dishonest. And Mike Krempasky of redstate.com says, this is a waste of time, that it's time better spent talking to voters -- Wolf.
BLITZER: Thank you, Jacki for that.
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