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Obama Looks to Rally Support and Voters in Northern V.A.; Severe Weather: Tornadoes Touch Down in Midwest U.S.; How Will Clinton Make her Exit?

Aired June 05, 2008 - 18:00   ET

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

WOLF BLITZER, CNN ANCHOR: And to our viewers you're in "THE SITUATION ROOM."
Happening now, Barack Obama tries to fire up Virginia voters while telling everyone to settle down about his vice presidential choice. We're standing by to go to a live Obama event, a major rally about to take place.

We also have a brand new CNN interview with the Democrat's presumptive presidential nominee. Candy Crowley spent time with him today.

Also, Hillary Clinton now on the brink of bowing out. She's promising to rally behind Obama this weekend, what does she need to say and do this weekend to help him and to help herself. And Obama puts his mark on the party machine. He is setting a new standard for accepting political cash. All that and the best political team on television coming up.

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

We want to welcome our viewers in the United States and around the world.

This hour the Democrat's nominee in waiting appears at a Virginia arena usually reserved for rock stars. Barack Obama is making a big push to win a long time red state this November. And he's talking about his rival John McCain and soon to be former rival Hillary Clinton.

Our senior political correspondent, Candy Crowley, is standing by. She spent some time with Barack Obama and had a one-on-one interview with him earlier in the day.

Candy, hold off for a moment, we'll get to that interview.

But I want to go to the scene of this rally. Jessica Yellin is in Bristol, Virginia, the Nissan Pavilion. A lot of rock concerts normally there but you would think a rock star is about to walk in where you are.

What's going on?

JESSICA YELLIN, CNN CONGRESSIONAL CORRESPONDENT: It sure sounds like a rock concert, Wolf, Barack Obama did not choose this location by accident. This state has not voted for a Democrat since 1964 for president. But he wants them to vote for him in November.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: Our friend, Senator Barack Obama.

YELLIN (voice-over): Obama kicking off his general election bid in Virginia.

SEN. BARACK OBAMA (D), PRESUMPTIVE PRESIDENTIAL NOMINEE: There's a reason why the first event, the first public event to be had after having obtained the nomination is right here in southwest Virginia because --

YELLIN: He hopes to take in this one time Republican stronghold in November. Here he was before the Virginia primary.

OBAMA: We want north. We want south. We want in between and I believe that we can win Virginia on Tuesday if you're ready to stand for change.

YELLIN: He did win in a landslide. Obama insists he appeals to voters from the other side of the isle.

OBAMA: Because of the tone I take where I try not to demonize others, we're able to attract independents and disillusioned Republicans.

YELLIN: They plan to do the same in the general election. Expect Obama to compete aggressively in purple states that went for George Bush in 2004 but show signs of turning blue. These includes Virginia, Missouri, Iowa, New Mexico, Ohio, Nevada, Colorado and Florida, possibly even Montana and Arkansas, where Bush won by big margins.

At the same time, they'll work to hold on to swing states that John Kerry narrowly won and that John McCain is now eyeing including Wisconsin, New Hampshire, Pennsylvania, Michigan, Minnesota and Oregon. The Obama campaign even talks about going after some red states like North Carolina and Georgia. Bush won here by huge margins. The campaign is hoping that Obama's appeal to upper income liberals and his ability to turn out African-Americans could give him a shot at turning these one safe red states blue.

GOV. TIM KAINE (D), VIRGINIA: Everything I see across Virginia makes me believe that Obama can win in November. He still has to consider himself the slight underdog and then work a little bit harder than the other guy. But if we do that, and I know we will, I think we got a great chance of winning.

(END VIDEOTAPE)

YELLIN: And Wolf, that was the governor of Virginia who says as the co-chair for Obama, he has traveled the country and he believes many of those other purple states can be Obama's if Obama devotes enough time by visiting them early and often. And the Obama campaign says they plan to do that. BLITZER: Pretty big crowd where you are right now. We see Jim Webb, the senator, getting ready to introduce Senator Obama.

YELLIN: It's an enormous crowd, Wolf.

It looks like another one of those rock concert type venues. A lot of enthusiasm and a lot of noise.

BLITZER: All right. We'll stand by.

We want to hear what Barack Obama is going to be saying. Jessica, stand by with us for that.

We want to get to our brand new interview though with Barack Obama right now. He sat down earlier in the day with our senior political correspondent, Candy Crowley. Candy is joining us now live.

He spoke about some of the most important issues that you raised with him, Candy. But you also got into this whole issue of Hillary Clinton and the future. Give us a little sense of what he had to say.

CANDY CROWLEY, CNN SENIOR POLITICAL CORRESPONDENT: Well, what's really interesting is you're right. We talked about Jerusalem. We talked about Iraq. We talked about the Gitmo prisoners. But you can't sit down with Barack Obama in this time and in this place as Hillary Clinton gets ready to get out of the race and not talk to him about her and how he feels about what have been these outside efforts to push her as number two on his ticket.

(BEGIN VIDEOTAPE)

CROWLEY (on-camera): You know and I know that if Senator Clinton wanted to tamp down this vice presidential conversation by her surrogates that she would. She has, as she will tell you, more than 17 million voters. She has more delegates than any runner-up in history. Do you have to put her on the ticket?

OBAMA: Well, let me begin by saying - repeating what I said on Tuesday night. She has been an extraordinary candidate. She has been an extraordinary public servant for years now. She ran as tough a race as could be imagined. And I have nothing but respect for Senator Clinton and what she's going to contribute to the party. And I'm also confident we're going to be unified in November.

What I've also said is the vice presidency is the most important decision that I'll make before I'm president. And it's something that I take very seriously.

I know Bill Clinton took it very seriously when he had to go through this process. Senator Clinton, I'm sure, would take it very seriously if she were going through this process. So we've got a committee that's made up of some wonderful people. They are going to go through the procedure and vet and talk to people and get recommendations. I will meet with a range of people, and I'll ultimately make a decision. Senator Clinton would be on anybody's short list. CROWLEY: But you don't feel -- there's an enormous amount of pressure out there for you to put her on the ticket. Do you feel that pressure?

OBAMA: You know, I'm a big believer in making decisions well, not making them fast and not responding to pressure. I think Senator Clinton right now is in the same position I'm in. Which is, we just completed 54 contests. We want to catch our breath. We need to take stock of where we are. I'm sure she has to do the same thing.

She and I will have a conversation. We won't be doing it through surrogates or the press, to talk about how we move forward, join forces to make sure we're successful in November. And so there's going to be a lot of time for that.

CROWLEY: Is it the best way to win over her supporters, though, if you put her on the ticket? You've seen I'm sure the polling that you're dropping women, sort of down-scale voters, those kinds of voters. Isn't that the best way to win them over is to put her on that ticket?

OBAMA: As I said, think everybody just needs to settle down. We just completed this arduous process. It's only been two days. And I think it's both -- not just in my interest and Senator Clinton's interest, but in the Democratic Party's interest and the country's interest to make sure that I make this decision well. And I will be deliberate and systematic about it because this will be my final counselor when I'm making decisions in the White House. And I want to make sure that I get it right.

CROWLEY: You don't feel at this moment you have to put her on the ticket, as bottom line?

OBAMA: Well, the bottom line is that we're going to go through a process and I'll make my decision sometime in the weeks to come.

(END VIDEOTAPE)

BLITZER: We're going to have more of Candy's interview with Barack Obama. Coming up, we're also standing by to hear from him. He's at this huge rally right now in Virginia.

Stand by for that. Candy is going to be coming back with more of this interview.

Let's check in with Jack Cafferty though right now. He's got "The Cafferty file" -- Jack.

JACK CAFFERTY, CNN ANCHOR: Bad news. More than a million homes in the United States are now in foreclosure, a staggering figure showing how hard the economy is hitting millions of Americans. American's equity in their homes, traditionally our biggest asset, at the lowest rate ever, going all the way back to the end of World War II. A report by the Mortgage Bankers Association showing the rate of foreclosures and late payments both setting records. In the first quarter of this year, the highest in nearly 30 years, and it's expected to continue to get worse. This group says the slump in the housing prices, the biggest factor for more foreclosures and late payments. And they will likely be more in the months to come because home prices are expected to keep going down. Some states are especially hard hit, California, Florida, Nevada, Arizona. They accounted for 89 percent of the increase in new home foreclosures.

These are states where the prices have dropped sharply and there was too much supply due to a lot of construction. A lot of homes in Michigan and Ohio have been foreclosed. In those states, it's because of rising job losses, especially in the automotive sector.

Around the country, the housing market meltdown and ensuing credit crisis have helped push this country to the brink of a recession if we're not there already. Consumers and businesses are spending less and employers have to cut more than a quarter million jobs in the first for month of this year. I saw a piece today. One of the airlines is going to cut 3,000 jobs.

Investor Warren Buffett says the recession is already begun and he says it will be longer and deeper than anyone realizes.

So, here's the question: What does it mean when more than one million homes in the United States are now in foreclosure?

Go to CNN.com/caffertyfile and give us your thoughts.

Tough still, Wolf.

BLITZER: All right. Jack, thanks very much.

Anger at the U.S. running high in some parts of the world. So, what does Barack Obama plan to do about it if elected?

(BEGIN VIDEO CLIP)

OBAMA: We've got to deal with Iran. And we have to tamp down the anti-American sentiment that has become so pervasive in the Middle East.

(END VIDEO CLIP)

BLITZER: Senator Obama wants you to know why his Iraq approach is better than John McCain's. He explains in part two of the interview. That's coming up.

Also, look at this, we're standing by to hear directly from Barack Obama. He's in Virginia getting ready to speak to a huge crowd at the Nissan Pavilion right outside Washington, D.C. He's in northern Virginia. Only minutes away, he'll be speaking shortly. Senator Jim Webb getting ready to introduce him right now.

And Hillary Clinton will have a delicate dance bowing out of the race gracefully in the eyes of Democrats. Stay with us. Lots of news happening this hour right here in "THE SITUATION ROOM."

(COMMERCIAL BREAK)

BLITZER: All right. There he is, Barack Obama. He's getting ready to speak to his supporters in northern Virginia. He's no doubt going to be thanking a lot of those who have come there. He's got a lot of friends in Virginia, especially northern Virginia, an area he carried in this contest against Hillary Clinton. We just heard Jim Webb, the senator there introduce him, Barack Obama.

This is his first major address at a rally. And it's a huge rally since he claimed the Democratic presidential nomination Tuesday night. We're watching this very closely. We're going to go back to Barack Obama momentarily, as soon as he finishes. Well, actually, maybe we'll listen to him. Probably going to thank some politicians there. But it might be interesting to hear what he has to say.

Let's listen in.

(JOINED IN PROGRESS)

OBAMA: So, first of all, be joined by Jim Webb, somebody who I got to know when he was campaigning for the Senate. We came down here a few times. And I'm not surprised that he has already emerged in this brief period as one of the true leaders in the United States Senate. An indispensable voice for change in Washington. Whether it's ending the war in Iraq or standing up for our veterans or advancing opportunities for working people, nobody has stood taller or firmer than Jim Webb.

He and I share a belief that we have to keep the sacred trust with the men and women who have served us so well. We have to serve them as well as they serve us.

And that's why I've been so proud of his leadership on the G.I. Bill that would make sure that today's men and women in uniform get the same opportunities that my grandfather got when he came back from World War II. That's the kind of leadership that Jim Webb has shown. We're going the pass that bill. We will get it signed into law because they deserve it. America deserves it.

That G.I. Bill is emblematic of the kind of work that Jim has done in Washington. He knows we have to change our foreign policy to restore our security and our standing in the world.

He knows we can't keep on sending or troops to fight tour after tour after tour of duty in a war that hasn't kept us safer, while we don't give adequate time for training and rest between deployments. And he knows that a Washington that is just working for Wall Street and is not working for main street is not the kind of leadership we need in Washington today. As a war hero, an author, a teacher, a public servant, and now a senator. Jim Webb has always fought hard for this country. Going forward, I'm going to be proud to be fighting with him, alongside him, to make sure that America is living up to the ideals that have made this country the greatest nation on earth. And let me tell you something. If you're in a fight, and we're going to be in a fight, you want Jim Webb to have your back.

Now, speaking of -- speaking of folks having your back, when I announced that was running for the presidency, this unlikely German, there were a number of people who said it's too soon. He's too young. He hasn't been in Washington long enough. We weren't getting the big name endorsements. A lot of people took a wait-and-see attitude.

But there was one person who about three days after I announced was willing to stand with me in the seat of the old confederacy right here in Virginia and say that the time for change has come. He's a man, he's a man who has the courage of his convictions. Somebody who has worked in charitable organizations overseas and worked on charities here at home. Somebody who, like myself, practiced civil rights law, somebody who has shown the ability to manage a city and now manage a state. Somebody who proves that nice guys can finish first.

BLITZER: All right. He's about to thank the governor of Virginia, Governor Cain.

We're going to go back to that speech. Barack Obama has got some others to thank as well. We want to monitor what's going on.

Also, there's more of that interview that he granted Candy Crowley that's coming up here in "THE SITUATION ROOM" as well. Stick around for that.

Meantime, Pentagon officials are angry right now. There's a scathing report about the Air Force's mishandling of nuclear weapons. Now some Air Force brass, civilians and military have been fired.

And in New York, they're calling him Spiderman. A man who scaled one of the most well-known buildings in Manhattan. You're going to find out why, what's going on, the message he's sending on this day.

Stick around, lots more coming up right here on "THE SITUATION ROOM."

(COMMERCIAL BREAK)

BLITZER: There is really some severe weather unfolding right now, tornadoes. Chad Myers is over at the CNN Severe Weather Center.

What do we know, Chad?

CHAD MYERS, CNN METEOROLOGIST: We do know, Wolf, that a tornado was on the ground six miles north of Clay Center in Kansas. And it has moved along in a line to the northeast on up to Blue Rapids now.

We had confirmed reports by police of this tornado on the ground, now moving into the town of Blue Rapids. Now, this is still going to continue. This is still on the ground. Marshall County, Kansas you're under the gun for this tornado for the next 15 to 30 minutes. We'll keep you advised. This is going to be a big severe weather night, Wolf.

BLITZER: Unfortunately, Chad. Thanks, we'll stay in touch with you.

Let's go back to Carol. She is monitoring some other important stories incoming into "THE SITUATION ROOM."

What's going on, Carol?

CAROL COSTELLO, CNN CORRESPONDENT: Well, Wolf, the man blamed for the death of nearly 3,000 Americans on September 11 would not mind if the United States put him to death. Admitted 9/11 mastermind Khalid Sheikh Mohammed knows he can face execution and wants to plead guilty saying, "I wish to be martyred." Mohammed and four co- defendants were arraigned before a military tribunal in Guantanamo Bay.

Mohammed wants to represent himself. The judge did not deny it but explain it would not be wise.

The top civilian and military leaders of the Air Force were fired today. Defense Secretary Robert Gates announced the ouster of Air Force Secretary Michael Wynne and Chief of Staff General T. Michael Moseley as he revealed findings from a damning report about the mishandling of nuclear weapons. It includes last August a mishap which a bomber crew flew from North Dakota to Louisiana unaware that nuclear-tipped missiles were on board.

He is nicknamed Spiderman but rather than catching criminals, police in New York says he is one. A French skyscraper climber was arrested a few hours ago after scaling a 52-story building that houses "The New York Times" offices in Manhattan. During the ascent, he unfurled a banner saying global warming kills more people than the 9/11 attacks every week. That's what it said. Back to you.

BLITZER: Thanks very much, Carol.

Carol Costello reporting.

Four years after Ronald Reagan's death, the former president was remembered today in Simi Valley, California. The former First Lady Nancy Reagan was among those who visited the grave site at the Reagan Presidential Library. Ronald Reagan died on June 6, June 5 that is, 2004 after suffering from Alzheimer's disease for more than a decade.

It's a big day for Barack Obama. He's speaking now to thousands of supporters in northern Virginia outside Washington. We're watching what he's saying. Also coming up, more of our interview today with Barack Obama. He explains in detail his position on Iraq, Iran, the future of Jerusalem, a lot more of Candy's interview with Barack Obama coming up. He was also asked by the way, today, what role he'd like to see Bill Clinton play in his campaign. We'll tell you what he's saying.

And a new snapshot of the Obama-McCain match-up.

How close is it? Will it stay that way?

Great expectations meantime for Hillary Clinton's swan song on Saturday. The best political team on television is ready to offer up tips, what she should say and not say.

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

(COMMERCIAL BREAK)

BLITZER: To our viewers, you're in THE SITUATION ROOM.

Happening now, Barack Obama holding his first major rally since clinching his party's nomination, speaking to thousands of supporters right now in Northern Virginia. We'll go there.

Also, Obama is now his party's standard bearer and flexing his muscles with the DNC. We're going to show you how he's changing the way things are done in Washington.

All of this coming up, plus the best political team on television.

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

All that coming up.

But first, we want to go back to Candy Crowley's interview today with Barack Obama in Southern Virginia. The Democrat continuing to push back against criticism of his foreign policy.

(BEGIN VIDEOTAPE)

CROWLEY: I want to ask you about something you said in AIPAC yesterday. You said that Jerusalem must remain undivided.

Do Palestinians have no claim to Jerusalem in the future?

OBAMA: Well, obviously, it's going to be up to the parties to negotiate a range of these issues. And Jerusalem will be part of the negotiations. But...

CROWLEY: But you would be against any kind of division of Jerusalem?

OBAMA: Yes. My belief is that as a practical matter, it would be very difficult to execute. And I think that it is smart for us to work through a system in which everybody has access to the extraordinary religious sites in old Jerusalem, but that Israel has a legitimate claim on that city.

CROWLEY: You've upset the Palestinians with this, who have said -- some of the leaders have said it shows he is not for peace, if he believes Jerusalem should remain undivided.

It causes a problem, doesn't it, as the U.S. being an honest broker?

OBAMA: Well, keep in mind, though, that I've said some things -- and I said even some things yesterday -- that probably some Israelis aren't happy with, which is that we have to look at the settlement policy of the Israeli government. And that has not been helpful to peace, as well; that we have to be a contiguous and cohesive Palestinian state that functions effectively.

You know, there are a whole host of areas where I think there's going to have to be compromise on both sides. And what I said yesterday is that we're going to have to start earlier than we have historically on this process.

I recognize that a president comes in with a lot of stuff coming at him. But the Middle East peace process is so important, that we can't reserve it to the end of a presidency. We've got to start soon. And I'm going to be absolutely committed to making that happen.

CROWLEY: You've said you want to go back to Iraq...

OBAMA: Yes.

CROWLEY: ...and see what the situation is on the ground.

Is there nothing that they could show you or that General Petraeus could tell you that would move you from wanting to immediately begin removing U.S. troops?

OBAMA: Well, you know, I would never say there's nothing or never or no way in which I'd change my mind. You know, obviously, I'm open to the facts and to reason. And there's no doubt that we've seen significant improvements in security on the ground in Iraq. And our troops and General Petraeus deserve enormous credit for that.

I have to look at this issue from a broader strategic perspective, though. And in terms of long-term strategy, I am absolutely convinced that the best thing we can do is to set a clear timetable, tell the Iraqis we are going to start pulling out, do it in a careful fashion, make sure...

CROWLEY: Now, when you say careful...

OBAMA: Yes?

CROWLEY: What are we going to be careful about?

OBAMA: Well, we're going to be careful about two things. One is we've got to be careful about the safety of our troops. It's not an easy exercise to bring out the thousands of troops that we have there, the tons of equipment that we have there. So we've got to execute that effectively. But we also have to do it and pace it in a way that works in concert with the diplomacy that's happening inside Iraq and in the region. And it's got to be coupled with increased humanitarian aid -- something that we have not done a good job of. It's going to have to be combined with getting the United Nations and other international agencies to put in place monitors so that we can assure that we don't see genocide, we don't see ethnic cleansing taking place.

There's a lot of work that's going to have to be done. It's a very complicated operation. And I've got no interest in doing it carelessly or precipitously.

CROWLEY: But a timetable could slide then, I mean if you took all those things into consideration?

OBAMA: Well, but I think it's important for us to say to the Iraqis we're not here for the long haul. It's time for you guys to achieve agreement on critical issues like how you're dividing up oil revenues, how the provincial government is relating to the national government. Those are issues you've got to resolve. We are not going to be here forever. And we will continue to work with you to make Iraq a cohesive, coherent state.

But we have a lot of other interests. We've got to make sure that Afghanistan is not sliding into chaos. We've got to go after Al Qaeda much more aggressively. Pakistan -- the peace agreements that they've been making with tribal leaders in those areas do not appear to be resulting in a better safety situation for our troops or for the Afghan government.

We've got to deal with Iran. We -- and we have to tamp down the anti-American sentiment that has become so pervasive in the Middle East.

Those are all things that I've got to take into account. And that's why I believe that my Iraq approach is much better to an approach that is essentially open-ended, when it comes to John McCain.

(END VIDEOTAPE)

BLITZER: Barack Obama speaking with our Candy Crowley earlier in the day in Bristol, Virginia, the southern part of the state.

By the way, on his flight from Bristol to Washington, D.C. -- he's right now speaking at a rally outside Washington. Obama was asked reporters about former President Bill Clinton. And he was asked whether or not he'd like Bill Clinton to actually go out and campaign for him, hit the stump for him. He said yes, I think Bill Clinton is an enormous talent and I would welcome him campaigning for me. Barack Obama saying that just a little while ago.

Let's bring in the best political team on television.

Jeff Toobin is here with us, Jeff Cafferty, Gloria Borger.

You know, he's wasting no time, Barack Obama. He's now, Jack, the leader of the Democratic Party and he wants his fingerprints all over this. He's making some tough decisions even right now. CAFFERTY: Just before we get to that thing you raised, did anybody ask Bill Clinton that same question?

BLITZER: No.

(CROSSTALK)

CAFFERTY: Because I'd be interested...

BLITZER: But (INAUDIBLE).

CAFFERTY: I'd be interested in his answer.

BLITZER: I'm sure we'll hear from Bill Clinton tonight.

CAFFERTY: Somebody probably will at some point.

BLITZER: Yes.

GLORIA BORGER, CNN SENIOR POLITICAL ANALYST: Yes.

CAFFERTY: He's done a couple of things. This interview with Candy Crowley -- and this -- I watched it earlier and I just watched it again. Whether you agree with him or not, here's a man who has a very clear vision of where he wants to take the country, when it comes to the war, when it comes to the decision he made today with the DNC, that they will no longer accept any PAC money or lobbyist money. This was a promise that he made the day he declared he was going to run for president. And within 48 hours of getting the nomination, he kept it.

What a refreshing thing for a politician to do.

BLITZER: And people don't appreciate necessarily, Gloria, the fact that, you know, he is now the new leader of the party and he's got that authority.

BORGER: Right. And he is installing a top staffer of his at the DNC to work with Howard Dean.

You know, it's interesting, though, because he's making the same rules for the DNC that he has for his campaign. But, you know, practically, you should all be aware that the DNC doesn't raise a lot of money from lobbyists or from lobbyists or from PACs. So it's not going to really hurt the Democratic National Committee. What's really going to help the Democratic National Committee is having Obama's fundraising apparatus really take over so that the DNC can try and catch up in some way with the Republicans, who are really outraising the Democrats at the National Committee level.

BLITZER: And that's a good point.

But, you know, Jeff, getting back to the leadership of the Democratic Party, it's not just Howard Dean he's jumped over -- or Hillary Clinton or Bill Clinton, for that matter -- but it's Harry Reid, the Senate Democratic leader, Nancy Pelosi. Barack Obama now, in the past 48 hours, has emerged as the major Democratic figure in the country.

JEFFREY TOOBIN, CNN SENIOR LEGAL ANALYST: He is and he will remain as long as he wins in November. You know, John Kerry was the leader of the Democratic Party from about April to November of 2004. But, you know, it's all about winning. And John Kerry is not the leader of much of anything except his Senate seat now.

So, yes, it's true. But it's all dependent on victory in November.

BLITZER: Another good point. You know, we're getting a lot of good points from all three of you guys.

(LAUGHTER)

BLITZER: Stand by.

CAFFERTY: That's why we're here every night, Wolf.

(CROSSTALK)

TOOBIN: That's why we're here, right?

CAFFERTY: We just chock full of good points.

BLITZER: More excellent insight coming up, guys. Stand by for a moment.

Barack Obama -- he's still speaking at that rally outside Washington and Virginia. And he just said something important about Hillary Clinton. And we're going to be playing those comments for you. That's coming up next.

Also, it's a speech the world will be watching on Saturday.

So what does Hillary Clinton need to say to unite Democrats when she endorses Barack Obama?

Lots more coming up right here in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: Let's get back to Barack Obama. He's speaking right now live outside Washington, D.C. , in Bristol, Virginia at the Nissan Pavilion. Thousands of people have gathered at this, his first major rally since clinching the nomination the other night.

Let's get back to our panel, as well, Jeff, Jack and, Gloria.

He said this about Hillary Clinton, Jeff, only moments ago. I want to play this clip.

(BEGIN VIDEO CLIP)

OBAMA: Because Senator Clinton, she made history. There aren't many in public life in our history who are smarter, more diligent, more dedicated to the cause of lifting up those in need than Senator Clinton. I am a better candidate because of the work she did. And she deserves our honor and our respect and our gratitude. And my two daughters see themselves differently because she ran for president of the United States of America.

(END VIDEO CLIP)

BLITZER: All right, Jeff. I think that sets up this question well: What does she have to say Saturday about him?

TOOBIN: You know, I think it's pretty easy. Just be gracious, be enthusiastic, talk about how what unites them is more than what divides them. I don't think it will be a difficult job for Hillary Clinton and I bet she'll do a terrific job at it.

BLITZER: What do you think, Gloria?

BORGER: Well, I totally agree. And Jessica Yellin just sent around, at CNN, some of the language in the invitation to Hillary Clinton's event. And it's as if she was reading your mind, Jeffrey, because she said in it, she will be thanking her wonderful supporters and announcing her enthusiastic support for Senator Obama. She will speak about the importance of party unity and joining together.

BLITZER: What do you want to hear her say, Jack?

CAFFERTY: You know, it's funny. Dan Rather wrote a book once. It's called "The Camera Never Blinks." And these cameras don't. They see right through to the very bottom of your soul if the you sit in front of them for any length of time.

And the two moments that I can remember where Hillary Clinton showed up best in front of one of these cameras was that time in the diner in New Hampshire, when she told people because of you, I found my voice this week, and she got a little choked up. And the other time, at one of the debates, when she was sincerely talking about the friendship that existed between Barack Obama and herself.

I don't care what she says. But I hope I see those qualities in her on Saturday, because that will tell me she's speaking from her heart. And I think that's the most important thing she can do.

BLITZER: Arguably, Jeff, this is going to be a very important speech, looking ahead to her future. Obviously, his future is going to be significantly potentially affected. She's got, what, almost 18 million people who voted for her over the course of these many months. But it's going to help set the scene for her future going forward, as well.

TOOBIN: And she has to be known as someone who stood with her party. If she hopes to be president -- as she surely does -- look, Barack Obama may lose and there may be an opening in 2012. But in 2016, Hillary Clinton will be three years younger than John McCain is now. And women live longer than men. So she has a long period...

(LAUGHTER) TOOBIN: ...a long life and a long political career ahead of her. She has an interest in being a good sport and a good soldier. And she knows she has to be a good campaigner for Barack Obama.

BORGER: And I think in terms of women, I think she really has to talk to women. And she really has to tell women why Barack Obama is the best candidate for president at this point. And she has to say we are in it to win it together and really speak to the people who have cared so deeply about her, many of whom are so angry about this race. She has to go a long way to try and sort of get rid of that anger -- at least start doing that for Obama.

CAFFERTY: Mike Lupica in the "New York Daily News" -- he's an old friend of mine. He wrote a good column. And one of the things he brought up this morning was this anger in the Hillary camp among her supporters. And he made the point -- and we've talked a little bit about it on this roundtable, about whether, when it comes right down to it, whether Hillary Clinton supporters are going to either stay home or vote for John McCain, or whether they're going to vote for somebody who will put Democratic ideals back at the forefront of the public debate.

And he said they have to remember, among other things, that voting for John McCain is voting for a bunch of people who want to make party hats out of Roe v. Wade. It was only one line. But it's, you know, that's the kind of stuff that people have to think about.

BLITZER: All right, Jack. Stand by. We've got "The Cafferty File" coming up.

And we want to thank, of course, Gloria and Jeff, as usual. Guys, thanks very much.

Let's check in with Lou to see what's coming up at the top of the hour -- Lou.

LOU DOBBS, HOST, "LOU DOBBS TONIGHT": Wolf, thank you.

Mexico's violent drug war spilling into this country, threatening the lives of Americans. Congressional Democrats are now holding up a massive U.S. aid package designed to help Mexico fight those drug cartels.

Also tonight, remember the Dubai Ports World fiasco?

Well, tonight, a new threat to our national sovereignty and security -- a secretive foreign hedge fund trying to take control of one of this country's biggest railroads -- a company that does military work, transports, as well, nuclear materials.

And Communist China outmaneuvering the United States and Europe in almost every quarter of the world now. China has already established economic dominance over the rich resources and minerals of Sub-Saharan Africa. I'll be talking with Fast Company's managing editor, Bob Safian, and investigative journalist Richard Behar, about one of the most compelling and important magazine articles in years. You don't want to miss this.

And tonight, responses to my challenge to Senators McCain and Obama to end the revolving door between presidential administrations and lobbyists. We'll tell you how they reacted.

Join us for all of that at the top of the hour and much more, all the day's news with an Independent perspective -- Wolf, back to you.

BLITZER: See you in a few moments, Lou. Thanks very much.

And we're still monitoring Barack Obama's speech in Northern Virginia, outside Washington. We'll into date you on what's going on.

And what does it mean that more than a million homes are in foreclosure right now?

Jack Cafferty will be back with your e-mail.

Plus, the laugh, the pants suit -- what comedians will do without Hillary Clinton in the race. See how they're honoring her. It's a Moost Unusual story.

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

(COMMERCIAL BREAK)

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

CAFFERTY: The question this hour, Wolf, is: What does it mean when more than one million homes are now in foreclosure in this country?

Radiance writes in Spring, Texas: "The American dream is slipping away. If something doesn't change, we'll be a country of the very few rich and the very many poor, like India. Wouldn't that be exciting? Actually, despite denials, we're invested in each other. If the poor get poorer, the rich get poorer by default."

Ray in Nashville: "It means somewhere along the line, people have forgotten how to say no -- or, more importantly, have forgotten about their obligation to say no. Lenders should have said no to people who they knew couldn't afford the payments on these trick mortgages once the real payment level kicked in. Borrowers should have said no to these same trick mortgages, that offered initial low rates but were sure to go up in the not too distant future."

Rick writes: "It means maybe -- maybe Washington will begin to realize how much the American people are hurting."

Don't bet on that.

"From the mortgage crisis to gas prices, our leaders still have their blinders on. At some point, they're going to have to stop paying lip service to these problems and actually start addressing them." Jorge in Lancaster, California: "It means responsible people who read the terms and conditions of their mortgage, borrowed within their means, had excellent credit and put a sizable down payment up in order to build up equity are seeing the value of their greatest asset and family institution go down the drain through no fault of their own."

Linda says: "People can't afford gas to get to work or look for work. High unemployment rates, the high cost of health care, to name a few. How can anyone make a mortgage payment when they can't even afford a few gallons of gas?"

And Rick in West Hollywood, California: "One million homes in foreclosure and a recession longer and deeper than anyone realizes mean one thing -- George Bush and the GOP's chickens are coming home to roost. And we're the newspaper that lines the chicken coop floor."

If you didn't see your e-mail here, you can go to my blog at CNN.com/caffertyfile and look for yours there among hundreds of others -- Mr. Blitzer.

BLITZER: Mr. Cafferty, thank you.

Thank you very much.

CAFFERTY: Sure.

BLITZER: And who's more upset than Hillary Clinton's supporters about the end of their campaign?

There may be one Moost Unusual group. We'll check it out right after this.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

OBAMA: We joked about the fact that if you had asked the pundits a year ago who were going to be the two nominees, it wouldn't have been me and John McCain.

(END VIDEO CLIP)

BLITZER: And now Jeanne Moos on bidding farewell to Hillary Clinton's candidacy.

(BEGIN VIDEOTAPE)

JEANNE MOOS, CNN CORRESPONDENT (voice-over): The pool cleaning guy came to the Clintons house to service their pool Thursday. And now that Hillary is dropping out of the race, she may actually have time to swim. But woe is me, contemplating life after Hillary.

JAY LENO, HOST, "THE TONIGHT SHOW": Final clearance -- all Hillary Clinton jokes must go tonight. Everything must go.

MOOS: Please, please don't go. STEPHEN COLBERT, HOST, "THE COLBERT REPORT": Dear Hillary, do not stop until all is blood and ash.

MOOS: We're left with two guys in suits -- but no pantsuits.

DAVID LETTERMAN, HOST, "THE LATE SHOW": Hillary lost and she said today I'm not going anywhere, I've already purchased my inaugural pantsuit. So...

MOOS: In honor of her departure, Conan retired a pantsuit into the rafters.

But Hillary will get the last laugh.

UNIDENTIFIED MALE: Senator Clinton...

MOOS: Where, oh where, are we going to get laughs?

SEN. HILLARY RODHAM CLINTON (D), PRESIDENTIAL CANDIDATE: Do I really laugh like that?

UNIDENTIFIED FEMALE: Well, well, well.

CLINTON: Oh, yes, well. (INAUDIBLE).

MOOS: And what are Hillary impersonators going to do?

UNIDENTIFIED FEMALE: To the beat of my heart, thinking about letting it out, I want to give in...

MOOS: Does this Chilean performance artist's act have legs without Hillary?

It's more fun when it's a woman tossing back shots, when it's a woman.

UNIDENTIFIED MALE: It has testicular fortitude.

MOOS: We're going to need testicular fortitude to go on.

And what about our Hillary toys, from all the stories we've done?

(on camera): And it's unthinkable -- no more cracking jokes about the Hillary nutcracker.

(voice-over): They've sold 230,000.

UNIDENTIFIED FEMALE: I think I broke a nail.

MOOS: Critics call them offensive, but Hillary autographed at least one. Suspicious packages containing the nutcrackers have even caused several bomb scares. The inventor has revamped the Web site to reflect what may be next.

Will the vice president become the vice president?

If she doesn't, we'll sure miss her pointed gestures. Exaggerated pointing comedians love to point out...

UNIDENTIFIED MALE: Clap, clap, point, point. Clap, clap, point, point. Clap, clap, point, point.

MOOS: And if we don't have Hillary, we don't have Bill.

UNIDENTIFIED MALE: You always follow me around and play these little games.

MOOS: Maybe the presidency was the one nut Hillary couldn't crack. But we're sure she'll pop up again. This is one politician you can't just put back in the box.

(on camera): Get in there.

(voice-over): Jeanne Moos, CNN, New York.

(END VIDEOTAPE)

BLITZER: That's it for us.

I'm Wolf Blitzer.

"LOU DOBBS TONIGHT" starts right now -- Lou.