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The Situation Room

Pakistan Attacks; Condoleezza Fires Back; Hit-and-Run Politics; "What Would Jesus Really Do?"; New Details in Diana Inquest; Three Generations on the Trail; Dog Gets New Home

Aired December 21, 2007 - 17:00   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

CAFFERTY: Mike in Hot Springs, Arkansas: "The free market provides sufficient punishment for flight delays. Just don't take that airline again if the service isn't satisfactory. The Feds can't be expected to take care of everything."
Christopher in Minnesota: "It doesn't make sense. How can you guarantee the exact times of flights? Too many things have to happen in order for it all to work out. Can it be better? Yes. Can it ever be flawless? No. The only way to solve the problem now is to find out who designed the FedEx package sorting system and put him to work on the airlines."

And, finally, J.W.: "Put the airline people in very uncomfortable seats for long periods of time, make them sit next to fat people with one armrest between them, make them breathe stale, contaminated air, listen to inane cell phone chatter at high volumes, give them six peanuts for dinner, make them smell rich folks' dinner, charge them for a sandwich. And, finally, a little torture -- by telling them when they can get out of those uncomfortable seats, but then -- delay, delay, delay until they all get just a little bit crazy." -- Suzanne?

MALVEAUX: Wow! Strong opinions.

Jack Cafferty.

Thank you so much, Jack.

Well, you're in THE SITUATION ROOM.

Happening now, slammed by candidates on both sides over its foreign policy. The Bush administration is fighting back. Secretary of State Rice becomes secretary for the defense, calling Mike Huckabee's latest charges "simply ludicrous."

Well, can America's foe, Hugo Chavez, use cheap oil to win new friends at America's expense and is he giving his ally, Cuba, a share of his power?

Also, final images of the most photographed woman in the world -- intimate details on the life and death of Princess Diana.

Wolf Blitzer is off today.

I'm Suzanne Malveaux.

And you're in THE SITUATION ROOM.

The Bush administration strikes back at presidential candidates who have blasted its foreign policy. The harshest of these attacks is from the president's fellow Republican, Mike Huckabee, who used the phrase "arrogant bunker mentality".

Well, he received the harshest response today.

Here's our State Department correspondent, Zain Verjee.

ZAIN VERJEE, CNN STATE DEPARTMENT CORRESPONDENT: Suzanne, Secretary of State Condoleezza Rice briefly ventured into presidential campaign politics, swiping back at some of her critics.

(BEGIN VIDEOTAPE)

VERJEE (voice-over): President Bush still has a year left in the White House. But his possible successors can't wait to change his foreign policy.

SEN. HILLARY RODHAM CLINTON (D), PRESIDENTIAL CANDIDATE: The era of cowboy diplomacy is over.

VERJEE: Secretary of State Condoleezza Rice, dismissive of campaign slogans she says don't fit.

CONDOLEEZZA RICE, SECRETARY OF STATE: I don't have time, all right?

I really don't have time to worry about this.

VERJEE: But she did respond to charges by Republican presidential candidate Mike Huckabee, who accused the administration of an arrogant, go it alone policy.

RICE: The idea that somehow this is a go it alone policy is just simply ludicrous. And one would only have to be not observing the facts.

VERJEE: Rice insisted the U.S.

Is working with allies on North Korea, Iran and the Israeli/Palestinian conflict and is open to better relations with countries like Iran and Syria.

RICE: The United States doesn't have permanent enemies. We're -- we're too -- too great a country for that. But they must choose cooperation, not confrontation.

VERJEE: If Iran plays ball?

RICE: Then I'm prepared to meet my -- my counterpart any place and any time and anywhere and we can talk about anything.

VERJEE: But until then, Rice promises to keep up the pressure.

RICE: As long as the Iranians are talking and practicing enrichment, you're not getting anywhere.

(END VIDEO TAPE)

VERJEE: Secretary Rice also says North Korea has shut down and is disabling its nuclear facility at Yongbyon. The key now is for North Korea to make an accurate and complete declaration of all its nuclear programs. That's due on New Year's Eve. But the U.S. may give North Korea some wiggle room Suzanne.

MALVEAUX: Thanks, Zain.

Mike Huckabee is sticking to his guns on his opinion of the Bush administration's foreign policy. He says he respects Secretary Rice and he wasn't intending to criticize President Bush. But...

(BEGIN VIDEO CLIP)

MIKE HUCKABEE (R), PRESIDENTIAL CANDIDATE: If we are so unable to point out policy differences and how things would change under a new administration, then maybe we shouldn't run for president. We'll just, you know, keep the current one in office.

(END VIDEO CLIP)

MALVEAUX: The Republican candidate spoke with our chief national correspondent, John King, aboard CNN's Election Express.

Well, the Pentagon is conceding that Al Qaeda has found both a new base and a new target -- that is Pakistan. The latest evidence -- a devastating attack on today on holiday worshippers in a mosque.

Let's turn now to our Pentagon correspondent, Barbara Starr -- Barbara, what are you learning about this tragedy?

BARBARA STARR, PENTAGON CORRESPONDENT: Well, Suzanne, there are growing worries at the Pentagon that Al Qaeda may be operating at free will inside Pakistan and planning new attacks.

(BEGIN VIDEOTAPE)

STARR (voice-over): At least 50 people were killed and dozens wounded Friday in a bomb blast in Northwestern Pakistan.

The believed target?

A former government minister who supervised operations against Al Qaeda. He escaped unharmed, but it's the latest indication that inside Pakistan, Al Qaeda is getting stronger.

ROBERT GATES, SECRETARY OF DEFENSE: Al Qaeda, right now, seems to have turned its face toward Pakistan and attacks on the Pakistani government and the Pakistani people.

STARR: Experts warn Al Qaeda now operates unchecked as an independent organization inside Pakistan's borders. Bruce Reidel worked for the CIA for 30 years. BRUCE REIDEL, FORMER CIA OFFICER: Al Qaeda has taken advantage of the political crisis in Pakistan to broaden its room for maneuver. They're also taking advantage of the fact that the Pakistani security services are now preoccupied with keeping their boss, General Musharraf, in power.

STARR: Congress is limiting military aid to Pakistan until it can prove it's cracking down on Al Qaeda. Gates says Pakistan has some way to go.

GATES: We are beginning a dialogue with the new chief of staff of Pakistani Army, in terms of how we can help them do a better job in counter-insurgency, through both training and equipment.

STARR: The Pentagon believes this stronger Al Qaeda is using Pakistan as a secure location from which to plan new attacks against the West. In what may be the latest example of Western worries, Belgian authorities went on alert Friday after uncovering a plot to free an Al Qaeda sympathizer from jail.

How comfortable is Al Qaeda these days?

REIDEL: Look at how often the senior Al Qaeda leadership is now appearing in video messages delivered to the rest of the world. They doubled the number of video messages they put out in 2007 over what they put out in 2006.

(END VIDEO TAPE)

STARR: So did the year 2007 see any progress in the hunt for Osama bin Laden?

Defense Secretary Robert Gates says progress will come the day the president of the United States announces bin Laden has been captured or killed -- Suzanne.

MALVEAUX: Thanks, Barbara.

In Iraq today, a top Shiite leader, for the first time, praised anti-Al Qaeda militias made up mostly of rival Sunnis. This comes just after a day after a suicide bomber killed 13 members of an anti-Al Qaeda group working with coalition forces near Baquba. Many Iraqis are determined to fight back against Al Qaeda. For some, it's an after school activity.

CNN's Harris Whitbeck has their story from back Baghdad.

HARRIS WHITBECK, CNN CORRESPONDENT: Suzanne, a decrease in the levels of violence against Iraqi citizens is being attributed, in part, to the actions of local vigilance group organized by private citizens. Practically anybody can join these groups -- even those who aren't even grownups yet.

(BEGIN VIDEOTAPE)

WHITBECK (voice-over): A cold night at a civilian checkpoint in Baghdad. Saiff Sliman takes a minute to warm up by the fire with his commander and fellow militia members. Just a short break during his shift providing security to the entrance to his neighborhood.

Day in and day out, Saiff slings his AK-47 assault rifle with ease, as he makes sure nothing bad happens on his turf. When he's not on duty, he likes to work on his motorcycle at home. A devout Muslim, he performs the ritual washing before his daily prayers and as a matter of course, he does his schoolwork every afternoon. This civilian fighter is, after all, only 16-years-old. (on camera): Warfare has become a way of life for the citizens of Baghdad. For many of its teenagers, it's become a necessity. No child's play here. (voice-over): Saiff belongs to a local citizens militia known as The Awakening. Many of its members are just teenagers. All of them, they say, had relatives who were killed by insurgents.

Saiff joined after four of his cousins were kidnapped and beheaded.

SAIFF SLIMAN, ANTI-AL QAEDA FIGHTER (THROUGH TRANSLATOR): The main reason was security and to drive out Al Qaeda, because Al Qaeda harmed us and destroyed Iraqi society. They have no mercy, so I joined The Awakening in my area.

WHITBECK: He brushes off the dangers involved.

SLIMAN (THROUGH TRANSLATOR): I'm not afraid because my cause is just. Besides, I am here with my brothers and cousins. Together, none of us are afraid.

WHITBECK: The U.S. says The Awakening Councils have been crucial in achieving a downturn in the levels of violence in the country -- even if many of their members are just children spending their after school hours performing work once reserved for adults, safeguarding their homes, defending their families.

(END VIDEO TAPE)

WHITBECK: Al Qaeda in Iraq has termed these local citizen groups as bands of traitors and has threatened them with revenge. Revenge in their terms usually means death -- Suzanne.

MALVEAUX: Thank you.

A United Nations agency says Iraq's children were often caught in the crossfire during the past year. Hundreds were killed or injured and two million still face threats -- including disease and poor nutrition. According to UNICEF, an average of 25,000 children were displaced to other parts of Iraq each month and more than 1,300 children were detained by authorities during the year -- many for alleged security violations.

Jack Cafferty in New York with The Cafferty File -- Jack, what are you following?

CAFFERTY: With just two weeks to go now, a very large number of Democratic caucus goers in Iowa say they still have not decided who they're going to vote for. The debate, as you know, has been largely about experience, which is what Senator Hillary Clinton argues she has on her side -- versus change, which is what Senator Barack Obama promises to bring to Washington. And, also very much in this mix is John Edwards, who vows to do battle against the large corporations that have a stranglehold on the federal government.

In fact, recent polls in Iowa show Edwards trailing Clinton and Obama by just a couple of percentage points -- putting the three of them in a statistical dead heat. Iraq, health care and the economy all ranking as the top issues for Democrats in Iowa. But with so many undecided voters this late in the race, something is clearly missing.

So the question this hour is this -- in the closing days of the Iowa campaign, what will cause undecided voters to finally make up their minds?

E-mail your thoughts to CNN.com/caffertyfile and you can post them right there on my new blog. It's a fascinating place, my blog. Check it out.

MALVEAUX: We'll check it out, Jack. I'm sure it is.

Thank you, Jack.

Oil politics -- Venezuelan President Hugo Chavez thumbs his nose at the U.S. while cutting oil deals in Cuba.

Plus, the investigation into the death of Princess Diana -- new photos and videos, as the British try to put an end to conspiracy theories once and for all.

Also, family politics -- Chelsea Clinton makes a rare appearance on the campaign trail.

You're in THE SITUATION ROOM.

(COMMERCIAL BREAK)

MALVEAUX: Lawyers for the Bush administration were in federal court today to answer questions about the CIA's destruction of videotapes showing the interrogation of al Qaeda suspects. They hope to convince a judge not to launch another investigation.

Here's our justice correspondent, Kelli Arena.

KELLI ARENA, CNN JUSTICE CORRESPONDENT: Suzanne, this is the first time an administration lawyer spoke in public and under oath about those destroyed CIA tapes.

(BEGIN VIDEOTAPE)

ARENA (voice-over): We know the CIA destroyed interrogation tapes of terror suspects. Now, lawyers representing 11 Guantanamo Bay detainees want to know was that a violation of a court order?

DAVID REMES, ATTORNEY FOR DETAINEES: Yes, it's a fundamental matter of trust. If the government is willing to destroy potentially relevant evidence, as it's acknowledged doing in this situation, I don't believe that it can be trusted when it says it's preserved all of the other relevant evidence.

ARENA: At issue, a 2005 court order directing the government not to destroy any evidence of possible torture or mistreatment of detainees at Guantanamo Bay. The government argues the detainees on the destroyed CIA tapes were not at the prison when they were interrogated in 2002 and so the order didn't apply. But the government never said exactly where the detainees were in 2005 when the order came down.

What's more, government lawyers told the judge that any hearings could jeopardize a Department of Justice investigation and promised that if that probe found any evidence that his or any other court order was violated, they'd let him know.

TIM HEAPHY, FORMER FEDERAL PROSECUTOR: It's very important for investigators to proceed confidentially and have each person who they interview, interviewed uncorrupted, if you will, by other interviews.

ARENA: Lawyers for those detainees urged the court not to take a back seat to the executive branch, which destroyed the tapes in the first place.

(END VIDEO TAPE)

ARENA: The judge now has to decide whether to delve into the matter. Based on his questions and comments, though, he didn't seem really eager to do that -- Suzanne.

MALVEAUX: Thank you.

Kelli Arena.

Carol Costello is off today.

Fredricka Whitfield is monitoring the stories incoming into THE SITUATION ROOM right now -- Fred, what are you watching?

FREDRICKA WHITFIELD, CNN ANCHOR: Well, hello again, Suzanne.

Well, what some people use as a painkiller could be killing them. The FDA is warning against the improper use of a painkiller patch for Fentanyl. Fentanyl controls chronic pain in patients accustomed to narcotics. But the FDA says doctors are wrongly prescribing the drug for headaches while some patients are accidentally overdosing on it.

And when the economy tanks, holiday bonuses tank, right?

Well, not so if you work on Wall Street. What's billed as Wall Street's worst year in a decade still adds up to a 14 percent increase in bonuses. The four biggest American investment banks will pay out almost $30 billion in bonuses at year's end. Investment bank stocks plunged 45 percent this year. And heads or tails will soon mean a lot more for D.C. residents. The District of Columbia spent 10 years of lobbying to be featured on the flip side of quarters. The nationwide state quarter project was to end next year, but now will be extended to include D.C. and five U.S. territories, including Puerto Rico.

And great news for you late night lovers of political satire. "The Daily Show" and "The Colbert Report" return January 7th -- but without their striking writers. Here is a statement written by Jon Stewart and Stephen Colbert: "We would like to return to work with our writers. If we cannot, we would like to express our ambivalence. But without our writers, we are unable to express something as nuanced as ambivalence."

(LAUGHTER)

WHITFIELD: Oh, well, at least we made you laugh a little bit, right?

MALVEAUX: And, Fred, I think we could do a better job at writing, honestly.

WHITFIELD: Yes.

Well, it looks like you're going to have to tune in to June 7th now to really get a good gut wrenching laugh from them.

MALVEAUX: You and I are pretty funny off camera, I think.

WHITFIELD: I think so.

MALVEAUX: You know, we could give it a shot.

(LAUGHTER)

WHITFIELD: Let's do that.

(LAUGHTER)

MALVEAUX: All right, Fred.

Thanks again, Fred.

WHITFIELD: OK.

MALVEAUX: Three generations on the trail -- Hillary Clinton's mother and daughter join her in New Hampshire. We're on the scene.

And the life and death of Princess Diana -- intimate details and final images of the most photographed woman in the world.

You're in THE SITUATION ROOM.

(COMMERCIAL BREAK)

MALVEAUX: Burn it now, pay for it later -- that is the deal oil rich Venezuela is offering many of its neighbors.

Can America's foe, Hugo Chavez, use cheap oil to win new friends at America's expense?

And is he giving his friend, Cuba, a big new advantage?

CNN's Shasta Darlington is in Havana.

(BEGIN VIDEOTAPE)

SHASTA DARLINGTON, CNN CORRESPONDENT (voice-over): With friendly waves and warm pats on the back, Venezuelan President Hugo Chavez took the international stage. Despite a recent defeat in polls at home, he strolled into a regional oil summit here in Cuba full of lofty goals and the oil money needed to back them up.

"Today we're consolidating new oil geopolitics -- at the service of the people and not the interests of imperialism and big capital," he said.

It was all part of PetroCaribe, an alliance set up by Venezuela to provide oil at preferential terms to 15 Caribbean and Central American nations. Under the deal, officials say countries receive a combined total of 190,000 barrels a day, but defer 40 percent of the bill for up to 25 years.

Billboards and splashy TV ads promoted integration in the region -- where countries may be small, but can form strategic voting blocs in places like the U.N..

(on camera): The oil diplomacy appears to be paying off. Honduras and Guatemala -- two countries usually more closely tied to Washington -- also came here to central Cuba, seeking membership in PetroCaribe.

(voice-over): Chavez sent greetings to his ideological mentor, Fidel Castro, whom he met behind closed doors the day before. But it was Cuba's acting president, Raul Castro, who presided over the summit.

"When oil prices hit record highs, creating a tough situation for Third World oil importers, members of PetroCaribe find ourselves in a privileged position."

Cuba's role in the alliance is set to become more than symbolic. With help from Venezuela, it's refurbished a Soviet-era refinery aimed at distributing oil throughout the Caribbean -- putting Cuba at the heart of Chavez's oil diplomacy.

Shasta Darlington, CNN, Cien Puevos (ph), Cuba.

(END VIDEO TAPE)

MALVEAUX: So where do U.S. oil imports come from?

The largest provider is Canada, sending more than one-and-a-half million barrels per day across the border. For other countries, each provide the U.S. with more than a million barrels of crude oil per day. They include Saudi Arabia, Mexico and Hugo Chavez's Venezuela and Nigeria. Iraq is next at about a half a million barrels of oil per day.

And Chelsea Clinton on the campaign trail -- the former first daughter makes a rare appearance to help out her mom.

But do voters really care?

Also, Princess Diana conspiracy theories -- the new pictures in evidence that British authorities hope will put an end to years of speculation.

Plus, dirty tricks politics -- a look at the games candidates play to get ahead.

You're in THE SITUATION ROOM.

(COMMERCIAL BREAK)

MALVEAUX: You're in THE SITUATION ROOM.

Happening now, an American has been released from prison in Nicaragua four days after being acquitted of murdering his former girlfriend. The family of Eric Volz tells CNN they won't make any other statements until he is safely out of Nicaragua.

Karl Rove has just signed a deal to write his memoir. President Bush's former top political strategist will be paid $1.5 million.

And the next NASA mission to Mars is being delayed by two years. NASA says an unspecified conflict of interest in the purchasing process is causing the mission's delay until 2013.

Wolf Blitzer is off today.

I'm Suzanne Malveaux.

And you're in THE SITUATION ROOM.

Less than two weeks to go until the Iowa caucuses. As time winds down, the candidates are stepping up their attacks.

Our CNN's Joe Johns reports, well, it's getting nastier out there.

(BEGIN VIDEOTAPE)

JOE JOHNS, CNN CORRESPONDENT (voice-over): Hit and run politics, attack and retreat, throw the rock and hide your hand. It's practiced 365 days a year in this country. But when it gets this close to actually casting votes, people really start paying attention. Example -- Clinton supporter Bob Kerrey apologizing after using Senator Obama's full name -- Barack Hussein Obama -- to make a point. Kerrey said he did not mean to insult him or contribute to misinformation about Obama's heritage. Another example -- a Clinton campaign official in New Hampshire, who raised questions about how Republicans might exploit Obama's drug use when he was young.

Hit and run -- Clinton apologized; the official resign.

But when it comes to Obama's voting record as a state senator in Illinois, no apologies from the Clinton camp. Clinton supporters didn't hesitate to talk about how often Obama voted "present" instead of taking a stand on things by voting yes or no.

REP. ANTHONY WEINER (D), NEW YORK: And you believe it's OK to look at what they're for. You believe it's OK to look at what they're against.

Why can't you look at the votes they ducked?

JONES: That's not hit and run politics -- it's a full frontal, above the board attack. The Clinton team registered two domain names on the Internet to highlight the issue, but decided not to put anything on a Web site.

(on camera): What's significant about this is that it suggests the Clinton campaign is so worried about Obama it's resorting to these kinds of tactics.

(voice-over): Not lost here is that Barack Obama was the first campaign to go on the offensive -- sharpening his rhetoric, what they call contrasting himself with Senator Clinton before she started fighting back.

STEPHANIE CUTTER, FORMER KERRY COMMUNICATIONS DIRECTOR: I think Barack Obama, you know, started to do a sharp contrast on Hillary Clinton about six weeks ago. And he didn't pay a price for that. I think Hillary Clinton started to do a sharp contrast against Barack Obama just about four weeks ago. And in the media, at least, she has paid a price for that.

JOHNS: Opening, but if the race stays this close, prepare for a barrage. Joe Johns, CNN, Washington.

(END VIDEOTAPE)

SUZANNE MALVEAUX, CNN ANCHOR: Well, religion has played a key role in the election campaign as candidates try to trump up one another by promoting their faith and values. But CNN contributor Roland Martin wonders what would Jesus really do? That is the title of his holiday special airing tonight at 8:00 eastern on CNN. And Roland Martin joining me now from New York with preview of all of this. Good to see you, Roland.

ROLAND MARTIN, CNN CONTRIBUTOR: Nice to see you.

MALVEAUX: Which candidate when you look at all these guys, which one is actually using religion as a tool, faith as a tool to promote their political agenda? MARTIN: No doubt, Mike Huckabee. Frankly Jesus is his running mate, if he actually had one. I mean, he is truly out front and, you know, I loved his comment, the reason for his rapid rise is sort of like, you know, two loaves, couple fish feeding 5,000 people and so divine intervention is what he is leaning on to lead him to an Iowa win.

MALVEAUX: Do you voters are buying this divine intervention? Who is it working for?

MARTIN: Well I'll tell you, bottom line is, he all of a sudden, he blew up and actually called it, I was on a show in Chicago and they said if you had a choice, who would you bet the house on to be on the GOP ticket and I said Mike Huckabee. I had a republican strategist who said, are you out of your mind? Something about this guy. He is relying on that faith-based, Mr. Rogers sort of appeal to sort of reach out to people and bottom line is working. He scammed out of Mitt Romney and Rudy Giuliani.

MALVEAUX: What about the democrats on the democratic side here? Because they seem to be trying it make end roads here and the republicans have had some success in that. Are they making any head way?

MARTIN: Actually, I think they are. In 2004, John Kerry got into the game real late when it comes to reaching out to progressive evangelicals. Part of the issue also is the republicans, the conservative side; they have an infrastructure in place. The progressives are really getting it to then. When they have this debate that took place and that was a critical issue. And all of these guys, whether it's Clinton, Obama, Edwards, they all have these faith-based outreach campaigns. You go to their websites, all kinds of information out there. They're really trying to do it.

The problem is, they have more special interest in their party who, frankly, shy away from faith. Joe Biden said, he was on CNN that part of the problem is democrats come off as agnostic in many ways and so they say, wait a minute, we believe in faith. Obama has been out there with his faith, Edwards as well, Clinton not as much, but, clearly, they understand they must speech to the faith-based voter because they're critical in these elections today.

MALVEAUX: The title of it "What Would Jesus Do." Does anybody address who Jesus would vote for perhaps?

MARTIN: Actually we've got a rapid fire deal set up, someone from the left and from the right and throw the issues out and say how would Jesus vote and I'll cast a vote, as well. It's going to be real interesting. We'll look at the whole issue of same-sex marriage, illegal immigration, war in Iraq.

So, again, folks will have to wait until the end of the show to see all the votes tallied, but we want to put it out. We don't speak for Jesus but what the bible says about some of these issues and how would Jesus vote so it opens the folks' eyes and enlighten them on this topic. MALVEAUX: Another topic, you talk about this. I know somewhat ticked by what Mitt Romney said recently that he saw his father marching with the Reverend Dr. Martin Luther King.

MARTIN: Absolutely.

MALVEAUX: His campaign said, now, wait a minute. He was talking figuratively when he said he saw him but that he was aware that it happened.

MARTIN: Sounding like me saying I was in Washington, D.C., and I had dinner with Suzanne Malveaux and I was on one side of town and she was at the airport. No, that's not the same thing.

When you say I marched with King, we all know what that means. Every politician wants to say that to identify what that cause. So, when you say I marched with King, we're sitting here thinking, yeah, you march would King, not oh, while King was marching I was thinking about him.

I'm sorry. Mitt Romney you can figure out ways to parch the language. Your daddy did march with King, the "Detroit Free Press" has the proof. Stop sitting here and split the words. Just say look, he did march, but, hey, here's the crazy thing, Suzanne. His dad was a huge supporter of civil rights. So you don't have to claim something that didn't do. It's nonsensical.

MALVEAUX: Are you dealing with the issues of honesty and morality in this, as well?

MARTIN: Well of course. We're tying, not only that, this whole Christmas season, all the flap over the candidate trying to do their Christmas commercials and so we're dealing with, who is saying merry Christmas versus happy holidays because all kind of folks out here who want us to get rid of the green and red and do just white. We sort of sanitized Christmas. And so we stirred up a hornets nest on CNN.com.

MALVEAUX: Not surprising.

MARTIN: Well, you know, y'all do it now and then.

MALVEAUX: I think the best way to put it, happy, merry, or however you put it, you know. Probably the one thing that everybody can agree on.

MARTIN: Throw Hanukkah, Kwanzaa and Christmas all in there. Have a great time in December.

MALVEAUX: All right. We're looking forward to seeing your special. Thank you so much, Roland.

MARTIN: I appreciate it.

MALVEAUX: All right. Thank you again.

Religion, politics and the commercialization of Christmas. CNN contributor Roland Martin asks what would Jesus really do about the dilemmas facing modern Christians? That's a CNN special report tonight at 8:00 eastern.

Well, it's been ten years but some mystery still surrounds the death of Princess Diana. We have an update on the Inquest looking into exactly what happened.

Also, he stayed with his marine master as his handler died on the battlefield. Now, Lex gets a new home. You won't want to miss this heart tugging story.

You're in THE SITUATION ROOM.

(COMMERCIAL BREAK)

MALVEAUX: Ten years later and we're still learning more details about Princess Diana's death. A bartender says that Diana's driver was drunk the night of the crash. The August 31st, 1997, crash killed the driver, Princess Diana and her boyfriend, Dodi Fayed.

CNN's Paula Hancocks joins us with the latest photos and the latest twists in this decade-long mystery.

PAULA HANCOCKS, CNN CORRESPONDENT: Suzanne, more than ten years after the death of Diana, princess of Wales, you would think there is nothing more to learn about that fateful night in Paris and the British Inquest into the deaths of Diana and her boyfriend, Dodi Fayed, has produced new pictures and fresh testimony.

(BEGIN VIDEOTAPE)

HANCOCKS: These are among the final images of the most photographed woman in the world, Diana, the princess of Wales watching the paparazzi chase her car just moments before the fatal crash. And the mangled wreckage of the black Mercedes in which her boyfriend, Dodi Fayed, and driver, Henry Paul, died and Diana was fatally injured.

These pictures were released by a British Inquest into the deaths of Dodi and Diana. As was this previously unseen closed circuit television of Dodi and Diana in the Ritz Hotel in Paris, poignant images of Diana smiling in the lift and of Dodi with his arm around her as they waited for their car.

A French inquiry eight years ago determined that the driver, Henry Paul, was drunk and driving too fast. The British Inquest also heard Paul was drunk, a barman at the Ritz saying he was walking like a clown.

The jury retraced that fateful journey in October visiting the hotel and the tunnel where Diana died. The question of the mystery do know remained in the crash remains unanswered. Two eyewitnesses told the Inquest they saw the car's driver swerving out of the Paris tunnel. One said he was driving, not looking ahead, but looking in his mirrors and I thought he was drunk. Intimate details of Diana are being revealed. The Inquest heard evidence she was on the contraceptive pill to counter claims she was pregnant when she died. Were Dodi and Diana engaged? This photo showed Dodi Fayed buying a ring for Diana, but Diana told a friend she needed marriage like a rash on the face. Dodi's father, Mohammad Al Fayed, is unwavering in his opinion. The car crash was deliberate to prevent their engagement becoming public.

MOHAMMAD AL FAYED, DODI'S FATHER: At last we want to have a jury and I hope to reach the decision which I believe that my son and Princess Diana.

HANCOCKS: Fayed blames the queen's husband for their deaths, but private correspondence between Diana and Prince Phillip show a relationship more tender than many had thought. Diana even calling the juke par.

(END VIDEOTAPE)

HANCOCKS: The Inquest will resume on January 7th. Next year we could hear testimony from Diana's former butler, Paul Burrell, and also from Mohammad Fayed. We're expecting a verdict to be recorded around April but it is unlikely to silence those that have been dealing in these conspiracy theories for the past decade. Suzanne?

MALVEAUX: Thank you.

All the evidence from the Diana Inquest is online. Our internet reporter Abbi Tatton has been taking a look and, Abbi, what are you learning about all this?

ABBI TATTON, CNN INTERNET REPORTERS: Suzanne, at the beginning of the Inquest the coroner decided to put all this information out there online once and for all. Twice a day the coroner's website has been updated with everything that the jury is seeing. For example, if the jury hears from the head barman at the Ritz there about Henry Paul's drinking habits, the receipt from that night will appear on the website with everything that he drank to accompany it. There's almost 400 pieces of evidence here online now, photos, maps, videos. Some of the most interesting has appeared in the last week, handwritten letters from Diana to darling Dodi. This one signed off August 1997, a million heartfelt thanks for bringing so much joy to this particular chick's life. The latest thing to be posted is the cost of the Inquest so far. That's $2.5 million and the there are several months to go. Suzanne?

MALVEAUX: Amazing details, thank you, Abbi.

Man's best friend was a marine's best friend. His handler was killed in Iraq and now this war dog finds a new home.

And Jack Cafferty asks in the closing days of the Iowa campaign, what will cause undecided voters to finally make up their minds? You're in THE SITUATION ROOM.

(COMMERCIAL BREAK) MALVEAUX: Hillary Clinton brings some special guests along on her latest campaign swing in New Hampshire. It's her mother and daughter, Chelsea. Our Mary Snow is in New Hampshire.

Mary, we've got three generations on the trail. I guess the big question is whether or not it will help the candidate.

MARY SNOW, CNN CORRESPONDENT: Well, certainly, Suzanne, the Clinton campaign is hoping so.

This is the first time, if you could see behind me, kind of a crowd here, but Chelsea Clinton, Senator Clinton and her mother, Dorothy Rodham, here in New Hampshire. The first time that Chelsea Clinton and Dorothy Rodham have been on the campaign trail here in New Hampshire. They had gone out in Iowa a few weeks ago and, certainly, all part of this whole concept of showing the softer side of Senator Clinton as she makes this final push here in New Hampshire just 18 days away from the primary.

And a lot of the focus today has been on being able to work on the other side of the aisle with republicans. Senator Clinton had an event earlier today where she spoke to a crowd, brought along a few republicans who are now supporting her saying that if she's elected she can do this and the White House also brought up instances where she worked with republicans in the senate. This, of course, as, you know, just another poll came out today showing how close this race is, showing a tie between her and her chief foe democratic rival Senator Barack Obama. This is one of a few stops that the family is going to be making while they're here in Iowa. Suzanne.

MALVEAUX: Mary, we saw some pictures, both of them smiling. They were getting coffee. Hillary Clinton sporting a leather jacket there, what it looked like. Give us the sense of the mood there. Does it seem to be really capturing people by their presence to have her daughter and her mom all at the same event?

SNOW: Yes. This is certainly much more relaxed, comfortable setting. The setting earlier today was a country store. Today, it's just mingling with people, getting coffee.

And, you know, when you talk to people who are watching these races here in New Hampshire, they say the key thing that Senator Clinton has to stress right now is her likability factor and the fact that she's been doing this also in Iowa trying to introduce herself to people and showing that softer side.

Also, tomorrow, there is an event Moms and Daughters Making History, certainly the Clintons hope they make history with this election. Definitely a very different tone set in these final days in New Hampshire campaigning to show the personal side as she also weaves in these issues but showing this side where she can sit down and talk with people, listen to them while stress that she should be the person they vote for.

MALVEAUX: Mary, we've been hearing her talk about healthcare lately as a big issue. Something that a lot of women, older women are very interested in. I'm curious who actually gets the most attention when they all walk into the room? Do they flock to her mother? Do they flock to the candidate? Are they really curious about Chelsea, who we haven't seen, really, for years?

SNOW: Right. You know, just by judging with this crowd, certainly Chelsea is a big draw with people trying to come up to her, introduce themselves and then she's making her way through the crowd.

As you mentioned, healthcare is such a big theme as she's trying to not only appeal to all voters here, but women voters. That's something she really stressed today. And what she's trying to drive home is that you know she rolled out this healthcare plan when she was first lady. She made her mistakes. She says she learned from them and now she's determined to do it again.

MALVEAUX: OK. Mary, thanks so much. Looks like you're in the middle of all the action there. Thanks, again.

SNOW: Sure.

MALVEAUX: Time now to check back in with Jack Cafferty, the Cafferty File. Jack, what are you following?

JACK CAFFERTY, CNN CORRESPONDENT: The closing days of the Iowa campaign, there are still a lot of undecided voters in the Hawkeye state so asked you what you think will finally cause them to get off the fence and make up their minds.

Susie in Atlanta writes, "Having been in a party caucus before, I don't think there will be any one factor that will tilt a caucus goer in any one direction. I think they'll get there, talk to their buddies and make their decision based on internal conversations with party delegates that they know and trust."

William writes, Cedar Rapids, Iowa, "Iowans won't make up their mind until caucus night. That's the way it always is. Remember in 2004, Kerry was in fifth place in the polls and won here surprising everybody. The top tier might be surprised on January 3rd."

Anthony writes, "We've had eight years of Emperor Bush. People want a change. However, putting in the new guy that does little else but talk a good game is not the answer. It's just not enough to talk about change. You have to have the experience and vision to make it happen. We endured one president that talked a good game and delivered nothing. We don't need another. Wise democrats will realize it takes a more than hype and a few good speeches to be president and they will vote for Hillary Clinton."

Jerry in Arizona writes, "Why does everyone just accept it was fact that Hillary Clinton is the most experienced candidate? As far as I can see, she's been a senator for one term, before that, the wife of a successful politician. If the president of General Motors suggested that his wife was qualified to take his job, he would be laughed out of Detroit. In reality, Hillary Clinton is the least experienced candidate but the most experienced wife." Ouch. John in Maine writes, "On the democratic side, it will be the candidate that can assure the public that they can get us back to the rule of law and restore our constitution. You know that paper they all take an oath to protect. On the republican side, it will whichever candidate is closer to god and the voting machine hackers."

Jarod writes, "For one thing I think Christmas or whatever holiday you celebrate being over will certainly help people make a decision. Believe it or not, not everybody lives and breathes on presidential politics at this time of the year."

And John writes, "Undecided Iowa voters will make up their minds after the media deludes them into believing people around the country care about who they pick." Suzanne.

MALVEAUX: Thanks, Jack. It's going to be a nail biter up until the very end. Thank you, Jack.

Undecided voters, there are a lot of people in Iowa and New Hampshire that cannot make up their minds. What are the candidates doing to convince the procrastinators?

Also, the verbal tussle between Mike Huckabee and Condoleezza Rice over U.S. foreign policy. We'll tell you who is saying what.

You're in THE SITUATION ROOM.

(COMMERCIAL BREAK)

MALVEAUX: Here's a look at some of the Hot Shots coming in from our friends at the Associated Press, pictures likely to be in your newspaper tomorrow.

In the West Bank, Palestinian Christians hold candles during an annual peace march near the biblical city of Bethlehem.

In Western Germany a man and his daughter look at an old tree decorated with Christmas lights.

In the West Bank, Palestinians enjoy a ride at an amusement park on the third day of the Muslim holiday of Eden.

In California, a 4-month-old giant panda cub plays with a ball at the San Diego Zoo. She makes her public debut tomorrow.

That's this hour's Hot Shots, pictures worth 1,000 words.

Man's best friend often becomes a marine's best friend when they're both stationed in Iraq. This story is more than a connection between a man and a dog. It's a story about Lex, a marine dog and what happens when his handler is killed in action.

CNN's Rusty Dornin reports about Lex and his new family.

(BEGIN VIDEOTAPE) RUSTY DORNIN, CNN CORRESPONDENT: An old pro going through his paces for the last time, at least for his military career. This 8- year-old German shepherd, Lex, was the bomb-sniffing companion of Marine Corporal Dustin Lee. Lex was at Lee's side when his handler was killed in an attack last March in Iraq that also wounded the dog.

2ND LT. CALEB EAMES, U.S. MARINE CORPS: Corporal Lee was down on the ground and Lex was right beside him. In fact, Lex had to be pulled away from Corporal Lee in order for the medical staff to attend to him.

DORNIN: When Lee's body came home to Quipman, Mississippi it was a welcome worthy of a hero. Tearful townspeople lined the streets for a young man known to be a patriot. When the marines brought Lex to see the family, Lee's younger brother, Cameron, played for hours with the dog. It was then the family began its fight to get an honorable discharge for Corporate Lee's faithful companion.

JEROME LEE, FATHER: Since Dustin's death, we've been trying to get his dog, Lex, from the Marine Corps and needless to say we've had a difficulty there.

DORNIN: Lex still had two years of service left until his mandatory retirement at age 10. That was a problem for the marines. Lex was an active duty dog. The request went from the base colonel to the commandant of the Marine Corps and had to go through the air force which controls all military dogs. It took nine months, finally, the marines relented.

EAMES: This is the first time that the family of a handler has been allowed to adopt a working, military dog, prior to his retirement.

DORNIN: Marine Corps officials say it costs thousands of dollars and man hours to train dogs like Lex. Often the dogs are adopted by their handlers after retirement or given to local police departments. To the Lee family, Lex is a priceless gift, whose leash was handed over to them in a ceremony at the marine base Friday. But for the Lees, Lex is not just a dog.

RACHEL LEE, MOTHER: A spiritual connection, knowing that Dustin would be very proud.

DORNIN: The brother and sister of the fallen marine wasted no time taking advantage of their new-found friend.

LEE: To have a part of Dustin, to have a companion for Cameron and Matty.

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