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The Situation Room

Holder Launches Criminal Probe into Gulf Spill; Panel Aims to Prevent New Spills; Israel to Free Prisoners After Raid; B.P. Stock Plummets

Aired June 01, 2010 - 17:00   ET

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

WOLF BLITZER, CNN ANCHOR: Thank you, Rick.

Happening now, the breaking news we're following: The attorney general of the United States, Eric Holder, announcing he's launching a criminal investigation into what is now the worst environmental disaster in U.S. history. All this as B.P. makes its latest attempt to cap the bleeding leak. And we're standing by for a news conference this hour from the Louisiana governor, Bobby Jindal.

Also this: They were supposed to kiss and make up. But could the relationship between Israel and the United States now grow even more strained in the wake of a deadly Israeli attack on ships carrying aid into Gaza?

And Osama bin Laden suffers a major loss. Al Qaeda reveals that one of his right-hand men is now dead, the number three in command, Mustafa Abu Yazid.

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

(MUSIC)

BLITZER: As we await a live news conference on the oil spill with the Louisiana Governor Bobby Jindal, there's now breaking news from the Attorney General Eric Holder. Listen to this.

(BEGIN VIDEO CLIP)

ERIC HOLDER, U.S. ATTORNEY GENERAL: We have begun both a criminal as well as a civil investigation as is our obligation under the law. Our environmental laws are very clear and we have a responsibility to enforce them, and we will do so. At the same time, we are mindful of the government's first priority, and that priority is to stop the spill and to clean-up the oil.

(END VIDEO CLIP)

BLITZER: B.P. says it will cooperate with any inquiry the Justice Department undertakes. Check out these live pictures, by the way, as B.P. is performing right now a major pipe cut in its latest effort to plug the leak. All of this coming on the first day of what is predicted to be a very active hurricane season. And that could spell even more trouble for the region.

The federal government's incident commander on the scene, the Coast Guard Admiral Thad Allen addressed those concerns today.

(BEGIN VIDEO CLIP)

ADM. THAD ALLEN, U.S. COAST GUARD: Our concern right now is that we don't have the well capped. Therefore, there is a possibility in hurricane season, if we would have to go off station, that would cause more oil to be discharged. And we need to understand what are the conditions, how long can we stay out there, how quickly can we redeploy back, and do we have a way to do things like treat the oil that would be coming out with subsea dispersants. And both plans are being requested and they're being developed by British Petroleum right now.

(END VIDEO CLIP)

BLITZER: Let's bring in CNN's David Mattingly, who's on the scene for us, as he has been almost from day one.

This continues to be, David, a real mess with no guaranteed end in sight.

DAVID MATTINGLY, CNN CORRESPONDENT: That's right, Wolf. Admiral Allen is essentially laying it all out for us. We could be looking at a very long and oily summer. Even though we are going through the minutia today, watching B.P. as they attempt to put some type of capping device on that leaking well, Allen very clear to say that all of these are just containment options and these options are not going to stop the flow of oil into the Gulf of Mexico. In fact, we're going to see oil escaping into the Gulf all the way up until August when they complete the relief well and finally seal this well off.

I approached Allen after the press conference and asked him for some clarification. There are two different types of domes or caps they're looking at right now. I asked him what happens if both of these fail.

(BEGIN VIDEO CLIP)

MATTINGLY: What happens if these, the cap and the top hat, what if they don't work? What's next?

ALLEN: There's a series of other events. They have their equipment staged down there. What happens is you get the larger domes that are less effective. But long-term issue is that, you know, we may be dealing with this problem until August and we get the relief well drilled. And I think we've got to be very honest with everybody.

(END VIDEO CLIP)

BLITZER: All right. Let me press you on one sensitive development that happened, David, today. The Obama administration is announcing no more joint news conferences involving officials from B.P. and officials from the federal government like Thad Allen. Why?

MATTINGLY: Yes, the Obama administration under a great deal of pressure to take charge of this situation. Essentially today, they're taking control of the microphone, saying that the person who's going to be talking us through this disaster now is going to be Admiral Allen. He is going to be the voice for the administration. He's going to be the voice telling us what kind of successes, what kind of failures and what sort of changes there might be along this path to put a cap on this well.

It's a big change from what we saw before with the joint information press releases where you had somebody from the Coast Guard, someone from B.P. and someone from the MMS standing by, as well. Now it's only going to be one voice. It's going to be the Obama administration commenting through Thad Allen.

BLITZER: But B.P. will still have their own news conferences to make their own statements, isn't that right?

MATTINGLY: That's not clear at this point. What we do know is that B.P. says they're going to be available to continue to clarify, to answer questions, but they may not be the ones to tell us if something's succeeding or failing anymore.

Again, the person who's going to be talking us through this disaster is now going to be Admiral Allen -- someone who's been having sporadic news conferences in the past. He is going to be the one handling the daily briefings and telling us from the administration's point of view where we stand with this disaster.

BLITZER: David Mattingly, thanks very much.

In case the cap containment method fails, B.P. started on two relief wells back in May. The first well has reached a depth of about 12,000 feet, the second about 8,500 feet. Neither, though, will be ready until August, because the deeper they get, the harder it is to drill, and hitting a pipe the width of a dinner plate miles below the surface clearly is no easy task.

This note, the Coast Guard incident commander, the man in charge of the federal government's response right now on the scene, admiral of the Coast Guard, Thad Allen, will be my guest in the next hour here in THE SITUATION ROOM.

A new commission headed by the former Florida Senator Bob Graham and the former EPA administrator, William Reilly, is tasked with finding ways to prevent future oil disasters. Toward that end, President Obama is urging them to follow the facts on the B.P. spill -- I'm quoting him now -- "wherever they may lead."

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: Good morning, everybody. We have an obligation to investigate what went wrong and to determine what reforms are needed so that we never have to experience a crisis like this again.

(END VIDEO CLIP)

BLITZER: Let's bring in our senior political analyst, David Gergen.

The administration now, six or seven weeks almost into this crisis, is distancing itself from B.P. Smart or not so smart, David?

DAVID GERGEN, CNN SR. POLITICAL ANALYST: Well, it's smart in one way I guess. It gives them a little public relations space.

But, Wolf, we still have the overriding problem of how do we mobilize the full resources of this country and indeed of the world to stop this leak and to do the clean-up right. And it seems to me that the case is even stronger today than it was last week, for the U.S. government, President Obama in particular, to seize control of this entire problem and take -- and set up a command center.

You know, and we've got -- Thad Allen is a very good man. I'm glad to see him doing the briefings. But one does not yet have the sense, especially as the government distances itself from B.P., that the government is trying to ride this with a B.P. now as a junior partner. All along, we've been in the situation where the government seemed to be riding shotgun, B.P.'s been at the wheel and we get in and we kibitz from the side and authorize them.

But we don't have a sense that there is somebody firmly in control and that we are not going to accept just, you know, in a resigned way that we have to wait until August to get this damn leak plugged.

BLITZER: The White House keeps saying that the energy secretary, Steven Chu, who himself is a Nobel Prize winner in physics, clearly a brilliant scientist, he's there on the command with the B.P. officials and nothing goes forward unless he says it can go forward.

GERGEN: Well, Steven Chu again is someone we all respect and I'm glad he is there. But I don't think the country has a sense, and certainly the administration has not conveyed that it's mobilizing the full resources. You can only do that out of the White House with a command post being setup there, bring in the military where you need it.

But I would like to see all of CEOs of all the major drilling companies summoned to the White House, on an emergency basis, saying we need the help of every company to figure this out. Let's bring the scientist into the White House, let's make people available. Have we seen Steven Chu on division television? Not very much that I've seen.

But there is -- there is just not a sense of muscularity and that whether we're doing this -- it's like we're fighting this with, you know, one hand behind our back or something like that.

I believe the president has to take full command. The law authorizes him to do that. Congress has twice amended the law after Hurricane Katrina and after the Exxon Valdez. They authorized and wrote the laws in such a way that he can seize control of this. And I, for the life of me, don't understand why they're not seizing control.

I know it's politically risky. But it's risky to the country for them to leave this essentially in the hands of B.P.

BLITZER: David Gergen, thanks very much.

GERGEN: Thank you. BLITZER: David Gergen is our senior political analyst.

Now, we're standing by for a news conference this hour on the massive oil spill in the Gulf with the Louisiana Governor Bobby Jindal. Stand by. We'll hear what he has to say. We'll go there live once we see him.

Also, will the United States and Israel kiss and makeup in the wake of a deadly Israeli attack on some humanitarian ships headed for Gaza? We'll have the latest on the U.S. reaction.

Plus, new changes emerging involving your right to remain silent. The details of a new Supreme Court ruling.

All that and a lot more coming up. Stay with us. You're in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: Good news. Jack Cafferty is back with "The Cafferty File."

We missed you, Jack.

JACK CAFFERTY, THE CAFFERTY FILE: Thank you, Wolf. Nice to be missed.

It's been 43 days since the start of the Gulf Coast oil spill, and the biggest environmental catastrophe in our history has many asking if this disaster has now become President Obama's Katrina. Once again, the people on the Gulf Coast have been devastated and they're calling on both the oil giant, B.P., and President Obama to do more. B.P. keeps trying -- so far, unsuccessfully -- to stop the leak and it could be as late as August before a permanent fix is found.

Meanwhile, the president's pushing back against criticism that his administration didn't act quickly enough, saying the Katrina analogy is just flat out wrong. But some Gulf Coast residents say the response to this crisis is even worse than George Bush's response to Katrina and that's saying quite a bit. They say there's a disconnect between what the administration says and what's actually happening on the ground. While the White House insists the law requires B.P. to clean up its own mess, some environmentalists say the government should just take over the response to this thing.

As for President Obama, Maureen Dowd of "The New York Times" says he wait too long to show his outrage over this and other issues, quote: "The man whose presidency is rooted in his ability to inspire withholds that inspiration when it is most needed," unquote.

So, here's the question: Has the Gulf oil spill become President Obama's Katrina? Go to CNN.com/CaffertyFile. Post a comment on my blog -- Wolf.

BLITZER: Jack, thank you.

And we're going to have a lot more on the spill coming up this hour. We're standing by also for a live news conference, the governor of Louisiana, Bobby Jindal, updating us on what's going on there. Stand by for that.

But there's other important news we're following. Israel now is saying it will release within 48 hours all activists it detained after a deadly assault on some ships carrying humanitarian aid to Gaza. Global pressure is mounting on the Obama administration to condemn the raid.

All this coming on what was supposed to be the day of a much anticipated meeting between President Obama and the Israeli Prime Minister Benjamin Netanyahu over at the White House. That meeting was canceled by the prime minister in the heat of this latest development.

Let's bring in our senior White House correspondent, Ed Henry, who's watching the U.S. reaction.

This is about as sensitive as it gets for the White House dealing with an issue like this, Ed. What are they saying? How are they reacting?

ED HENRY, CNN SR. WHITE HOUSE CORRESPONDENT: You're right, Wolf. It is a sensitive. And that's why Robert Gibbs, the White House spokesman, got a barrage of questions here behind the podium next to me earlier today and was really dodging a lot of them because the U.S. doesn't want to go far out on a limb until they get more actually facts on what really happened -- all kinds of stories on both sides. And nobody really knows exactly what happened.

And let's face it, he was pressed the questions on, you know, do you believe the Israeli version of events? Gibbs wouldn't answer that -- instead, kept falling back on this U.N. Security Council resolution that critics believe is pretty tepid because it really only calls for an investigation. It doesn't really come down on either side.

You can understand, the White House in a bit I've rock and a hard place here because if they start condemning Israel, it's only going to exacerbate those tensions that are already there between the U.S. and Israel. But if they look like they're giving Israel a pass, it's only going to anger people in the Muslim world.

And, in fact, Robert Gibbs pressed today on whether or not this will have an impact on the president's attempt to open a new dialogue with the Muslim world.

(BEGIN VIDEO CLIP)

ROBERT GIBBS, WHITE HOUSE PRESS SECRETARY: I think the president has obviously sent a lot of time on improving our relationship with countries throughout the world. And special time and care on our relationship with the Muslim world. I do not think that this will have a great impact on that.

(END VIDEO CLIP)

HENRY: But the fact is, the president has an upcoming trip, one of the stops will be Indonesia where he was planning some more outreach to the Muslim world. Given the heat of this current situation, it's hard to see how that will not be more complicated in the wake of the situation, Wolf.

BLITZER: I know the president's been on the phone with Prime Minister Netanyahu. The president of the Palestinian Authority, Mahmoud Abbas, he's supposed to be at the White House next week. Take us a little bit behind the scenes and tell us what else is going on.

HENRY: President Abbas is still planning to be here at the White House next week. So, that's going to go forward. President Obama, we're told by top aides, still planning to have Prime Minister Netanyahu here as soon as he can make it back.

I've also learned that there have been some calls between Uzi Arad, essentially the counterpart for the national security adviser here, General Jones, on the phone with General Jones several times in the last 24 hours or so to try to ascertain the situation.

Also, we've been told, the White House put out a readout yesterday saying there's one call between President Obama and Prime Minister Netanyahu. It turns out in the end, there were three calls. They had some travel difficulties. The president was in Chicago. The prime minister, as you know, was in Canada, cutting short that trip, trying to get back to Israel late yesterday.

But they ended up speaking three times yesterday. It gives you an idea of the intensity of the situation behind the scenes, Wolf.

BLITZER: Amazing series of events on this White House right now -- the Gulf oil spill, the economic situation, jobs, North Korea, South Korea, now this. This president has certainly his hands full right now.

Ed, thanks very much for all of that.

HENRY: Thanks, Wolf.

BLITZER: We're standing by for a news conference this hour. The Louisiana governor, Bobby Jindal, will update us on what's going on and share his efforts to protect Louisiana's coast from the oil spill. We're going to go there live once it starts.

And later, a surprise split. Al and Tipper Gore go their separate ways after 40 years of marriage.

(COMMERCIAL BREAK)

BLITZER: Looking at the live pictures right now. B.P. is going forward with cutting off the top there of that well that's exploding with oil. They're eventually, in the next few days, going to try to cap it. We're going to go through the whole process of what they're doing coming up.

We're also standing by -- you see, by the way, the cutting that's going on. We're standing by for Bobby Jindal, the governor of Louisiana. Look at the live picture on the right side of the screen. He'll be briefing us on the situation, the environmental disaster along the Louisiana coast.

In the meantime, Lisa Sylvester is monitoring some of the other top stories in THE SITUATION ROOM right now.

Lisa, what else is going on?

LISA SYLVESTER, CNN CORRESPONDENT: Hi, Wolf.

The former Vice President Al Gore and wife Tipper are separating after 40 years of marriage. The Gores announced their decision in an e-mail to friends today. The couple called it a mutual decision, quote, "following a process of long and careful consideration." Gore served with President Clinton, then lost his own bid for the presidency in 2000. He has since become a leading voice on the issue of climate change.

And note to suspects: If you want to remain silent, well, you're going to have you speak up. A divided Supreme Court today ruled five to four that a person must explicitly tell arresting officers that he or she is invoking the so-called Miranda right. The ruling upholds a murder conviction in Michigan. In a sharp dissent, Judge Sotomayor called the ruling a major retreat from protection against self incrimination.

And they add up to more than 160,000 pages. Documents from Supreme Court nominee Elena Kagan's time in the Clinton White House are being prepared for release three weeks before her confirmation hearings. Senate Republicans question whether they'll have time, though, to scrutinize her record. But the judiciary chairman, Democrat Patrick Leahy, says the hearings should not be delayed. Kagan was an associate counsel and domestic policy aide at the White House.

Elena Kagan's lack of judicial experience concerns many Americans but most do not think that she is too liberal to serve on the U.S. Supreme Court. In a new CNN/Opinion Research poll: 63 percent say Kagan is qualified but that others are more qualified. Should the Senate confirm Kagan? On that question, 54 percent say yes, 36 percent say no.

And her confirmation hearings are coming up, I think, it's what, June 28th, Wolf?

BLITZER: Yes, that Monday. The last Monday in June, they'll be hearings probably for her. She'll testify that Monday and Tuesday. By Wednesday, they'll probably bring in some outside experts, some outside witnesses to testify.

But at least right now, based on what we know, assuming that the Republicans don't filibuster and they say they won't filibuster, it looks like she's got pretty smooth-sailing ahead of her.

SYLVESTER: Yes. And CNN will be covering that, Wolf.

BLITZER: We certainly will. Thanks very much for that, Lisa.

Congress is on recess right now. But watching how B.P. is handling its latest attempt to stop the spill, should Washington take over the entire operation? I'll ask Congressman Ed Markey.

And if a massive oil spill and clean-up operation aren't enough, B.P. shareholders are taking a huge hit. We take a closer look at the state of B.P.'s stock.

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BLITZER: You're in THE SITUATION ROOM.

Happening now: a new attempt to try to slow the Gulf oil spill. How long must we wait before we know if it works? I'll ask the administration's point man on the scene, the Coast Guard Admiral Thad Allen.

It produces huge volumes of the world's most popular electronics. Work is plentiful. So, why are employees at a Chinese factory committing suicide at an alarming rate?

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

(MUSIC)

BLITZER: Loss of life, clean-up costs, lawsuits, a shattered image, B.P. is taking a beating from all sides in the wake of its oil rig explosion and the current massive Gulf oil spill. It comes as no surprise that its stock value is sinking, as well.

CNN's Mary Snow is joining us from New York with more on this.

Mary, how bad is it for B.P. right now?

MARY SNOW, CNN CORRESPONDENT: Well, Wolf, you know, this is the first day the markets were open both in London and the U.S. since B.P.'s top kill effort failed to stop the oil spill. And B.P. shares plummeted 15 percent. Today alone, the company lost $20 billion in shareholder value. And that didn't factor in news the U.S. attorney general has launched a criminal investigation into the spill. That news came just as the market was closing.

Now, today's drop was the steepest fall for B.P.'s stock since the Deepwater Horizon oil rig exploded on April 20th. Then the stock was around $60. It closed today around $36.50. Seventy billion dollars in shareholder value though has been wiped out in that time.

Now, investors are worried about the unknowns -- the cost of the clean-up, the cost of lawsuits. There are also worries the government might slap restrictions on the company. For example, will it take away leases?

And the question is: how strong is the company? What does it mean for paying out these costs?

This is a company that made $14 billion in profits last year alone. It was slated to make even more money this year.

I spoke to some analysts who cover this company. Some worry the stock might become so cheap, the company could become a takeover target. But a number of these analysts point out that the company is strong and fears they say about the company's strength some are overblown -- Wolf.

BLITZER: Is this a case where B.P. has some insurance company like AIG, or Lloyd's of London or somebody like that, that is going to help them deal with the enormous expenditures that they're going through right now?

SNOW: No, and that's because B.P. is self-insured. So the costs do fall on them. But it isn't shouldering it all by itself. In this case, B.P. had partnered with Anadarko. There's a Japanese firm Matsui, it also partnered with on the project on this oil field. So, those companies will likely share the liability. There's also Transocean which owned the rig.

There are estimates out there at this point, Wolf, that these costs could range between $3 billion and $25 billion. But the truth is that nobody really knows for sure. And some analysts don't expect all of this to be settled for several years out.

BLITZER: Mary Snow working this part of the story for us. Thank you, Mary. For more on the steep price BP is already paying, let's go back to Lisa Sylvester. What else is going on Lisa?

LISA SYLVESTER, CNN CORRESPONDENT: Wolf, you know BP's costs are rising. It is now nearing $1 billion and we're only 43 days into this. According to official numbers from the company in the last two weeks, BP's costs have more than doubled from $450 million on May 13th to $990 million as of today. And those numbers include the cost of responding, trying to contain the oil, relief well drilling, grants to Gulf States, and claims paid, and also federal costs added in. I want to give you more specifics on how it all breaks down. $40 million of that went to claims. $100 million in grants to Gulf States for their contingency plans, $70 million to help the Gulf States protect their tourism industry. But by far, most of the money spent so far has gone into efforts to stop the oil like the failed top kill operation that we heard so much about. BP's costs jumped from $760 million to $930 million in four days during that operation. And you know, you heard Mary say that financial analysts are saying that the cost to BP could be pegged on the high end of about $25 billion before this is all said and done, Wolf.

BLITZER: Amazing expenditures. Nearly a billion they've had to shell out already.

SYLVESTER: Keep that in mind, that's 43 days into this. They're talking about this being extended into August. It's definitely adding up, Wolf.

BLITZER: All right. Thanks very much.

I want to show our viewers a picture. We're standing by for a news conference from Louisiana. The governor Bobby Jindal he is going to go to the microphone over there, brief us on today's environmental disaster along the Louisiana coast. We'll go there once we see the governor.

Meanwhile here in Washington, Congress may be in recess, but many members are keeping a very watchful eye on the events surrounding the gulf oil spill and one representative is taking what BP says about its operations with a big dose of skepticism.

And joining us now, the chairman of the Congressional select committee on energy independence and global warming, Congressman Ed Markey, Democrat of Massachusetts. Thanks for coming.

REP. EDWARD MARKEY (D), MASSACHUSETTS: Thank you for having me in.

BLITZER: We just learned that the Attorney General Eric Holder has launched a formal criminal investigation into any wrongdoing that caused this enormous oil disaster in the Gulf of Mexico. I know you're in favor of that. But do you see at this point any criminal wrongdoing?

MARKEY: I think that there's enough evidence for sure to justify the opening of a criminal investigation.

BLITZER: Who potentially broke the law?

MARKEY: First of all, BP said that they had the capacity to deal with the spill that would be 250,000 barrels per day. Initially they said that this spill was only 1,000 barrels a day. Then they upped it to 5,000 barrels per day.

BLITZER: Is that a criminal act do you think potentially?

MARKEY: We can go all the way down the line and spend the whole day going through the litany of things that have been identified that BP represented that they could do but they did not do. It begins with them certifying the rig could not sink and it goes right through all of the rest of the assertions made by BP. That it turns out completely are not true.

BLITZER: You think BP was negligent.

MARKEY: At a minimum they're negligent.

BLITZER: Was the regulatory agency supposed that's supposed to supervise offshore oil drilling negligent?

MARKEY: I think there was a ticking time bomb that was allowed to be placed out in the middle of the ocean. I do believe that MMS did not do its job.

BLITZER: The agency in the department of interior.

MARKEY: The agency responsible for.

BLITZER: One head has already rolled there. Should other heads roll, the secretary of the interior, Secretary Salazar for example, should he stay on the job? MARKEY: Yes, he should stay on the job but I think this goes back to the drill, baby, drill era of the Bush administration. This is a time bomb that was set a long in the distant past.

BLITZER: Because as you know the Obama administration had a year and a half to clean it up.

MARKEY: I know that but they did not actually put their person on the job until July of 2009. So most of the decisions were made long ago and far away as part of a cozy relationship between BP and other oil companies and MMS. And we're now beginning to see, unfortunately, the consequences of that.

BLITZER: BP put out a statement saying BP will cooperate with any inquiry the department of justice will undertake just as we are doing in response to the other inquiries that are already on going. You've got your own congressional investigation into this. Are they fully cooperating with your committee?

MARKEY: I think there's still a lot of denial on the part of BP. For example, just two days ago, Tony Hayward, the CEO, said there was no evidence of any underwater plumes in the ocean. When in fact, independent scientists at the University of South Florida, the University of Southern Mississippi have identified those plumes. Again, in each instance, unfortunately, and increasingly, BP is more interested in their own liability than they are in the livability of the Gulf of Mexico and we have to keep that in mind every day for the rest of this summer.

BLITZER: Let me see if you agree with Robert Reich, the former labor secretary during the Clinton administration, a man you know. He says this. He says, "It's time for the federal government to put BP under temporary receivership which gives the government authority to take over BP's operations in the Gulf of Mexico and until the gusher is stopped. This is the only way the public will know what's going on." Do you agree with Secretary Reich?

MARKEY: Well, BP is not going into bankruptcy. It's not like General Motors. For all intents and purposes right now, the federal government is in the room on every decision being made by BP.

BLITZER: Should they take charge though?

MARKEY: They are in charge. There is no decision which is now being made that isn't being supervised.

BLITZER: Do you want them to go further?

MARKEY: I think we're in charge right now. The president doesn't have a magic wand in order to cure all of the problems created by BP, but in terms of going forward and the way it's been for the last month, the federal government is in the room, supervising BP, making sure that all decisions are made in the public interests. The credibility and competence of BP is in serious question and as a result, the Obama administration has guaranteed and is on the job making sure that all decisions are made in the public interests and not in the private interests of BP.

BLITZER: But the federal government needs BP because they have the expertise which the department of the interior, the department of energy, the pentagon, they don't have that expertise.

MARKEY: It's BP's spill. It's BP's equipment. But it's the ocean of the United States government and the people and the people are --

BLITZER: The government says they can't do it, they need BP.

MARKEY: And the people of our nation. That's why our government has to be in the room with this private company in order to make sure that the only decisions that are made are totally in the public interests and not in the interests of a private corporation that has caused this historic spill.

BLITZER: BP sent e-mails in March to the government agency, the minerals management services and the department of the interior saying they were worried about their well. Did the federal government do anything when they expressed their concern?

MARKEY: That's what an investigation is going to have to determine. That's why we're going to have to have every single aspect of this understood not just in the preceding month but going all the way back to, two, three years ago when decisions were made with regard to what kind of in-depth safety precautions had to be put in place in order to avoid a catastrophic accident.

BLITZER: Thanks for coming in.

MARKEY: Thanks for having me.

BLITZER: The governor of Louisiana, Bobby Jindal is speaking right now. Let's listen in. He's blasting the federal government for not doing enough to protect Louisiana's coast.

GOV. BOBBY JINDAL, LOUISIANA: They're not fishing right now. Come see the oiled pelicans and you'll see why we have no concerns about fighting this oil on-sandy barrier island as opposed to inside of our wetlands.

A second question that was raised was how long would it take to build these islands. You know, if we had gotten approval when we first asked for these islands, we could have had ten miles built already. Yes, it will take months to build all of these all 100 miles six miles high but we'll see immediate land being created. As soon as we get approval within 10 days, within 10 days, we would see land being built. We would get benefit before the final berm was built.

By the way, for Louisiana, we'll be dealing with this oil, we'll be dealing with this oil for months and for years. We know whether the next effort succeeds or not at diminishing the leak. There is still oil out there whether on the surface or below the surface. We know that for Louisiana, this is a marathon, not a sprint. We know with hurricane season now upon us, it is absolutely critical to build these sand booms so we can fight this oil away from our wetlands not closer to our coast.

We also heard different explanations. Somebody said, one of the experts testified Louisiana should have more confidence in the booms and other lines of strategy. If they were more effectively deployed that would be effective at keeping the oil out of our wetlands. There's not a person in Louisiana and I'm willing to say this, I don't think there's a person in Louisiana that honestly believes that we're going to get enough boom that's going to be deployed effectively enough to keep all of this oil out of our wetlands. Yes we need more hard boom but we need multiple lines of defense. We need these barrier islands, we need the more boom, we need the hard boom, the absorbent boom, we need the skimmers, we need all of it. There's not a person in that room I believe from Louisiana that honestly believes if they get us more boom, they're going to keep all this oil out of our wetlands.

One point I do want to make. The whole idea of sand booming was a part of our ACP. It was part of the plan approved by the coast guard. It was approved by the U.S. army corps of engineers. The federal government agrees with us that's it's been effective that the positives outweigh the negatives. It seems to me the only question to me is whether the federal government is going to force BP to pay for these first six segments so we can show that it works and so that we can keep this oil out of our wetlands.

Now what we heard from Admiral Allen is that he's on a 24-hour turn around. He's then going to make his recommendation to the president. The president said he make a quick decision. And let me say this, I said all along we didn't need another meeting. We didn't ask for another meeting. On Friday with the president, we were very clear it's not the process that interests us. It's the outcomes. Many may ask, are you happy with the meeting, are you happy with the process? I could care less about the meeting and the process. There were a lot of professors there. I told them, when I had a chance to speak at the end I said to me this is not a multiple choice test. This is not an essay test. This is a pass fail, yes/no test. If we get approval to move forward on at least our first six segments, then this will have been a successful day. If we do not get approval to move forward, this will be a waste of another day. We could have spent this day fighting the oil and doing other things to help safeguard our coast. For us, this wasn't about process. We didn't - for us it wasn't a good thing or bad thing to have a meeting. We will only know if today was productive when we finally get an answer whether the federal government will force BP to pay for these first six segments.

Let me give you a few updates from prepared remarks. Over the weekend, you know the top kill attempt by BP failed. That means now according to the estimates from the federal task force between 20 and 43 million gallons of crude that are now pouring into the gulf. Up to another 800,000 gallons are estimated to continue to spill into the gulf each day. You heard the estimates that with this new you tactic that could temporarily increase the philosophy oil into the gulf. And as I've said so many times before, we are in a fight to protect our coast, our way of life. And I explained to the admiral, one of the reasons we're so passionate and we had parish presidents all the way from St. Tammany all the way southwest to La Fourche and Terrebonne, we had mayors there, CCA endorsing our efforts.

The reason we're so passionate, we can't afford to be told wait for another study, wait for to us look at this more closely. It's like telling a drowning man just wait. We need to be rescued. We need help now. If others don't have a plan, we've come up with our own plan. We're not waiting to be rescued. We're simply saying get out of our way. Force BP to do what they're obligated under the law as the responsible party, implement a plan part of our ACP, implement a plan that the U.S. army corps of engineers has said would do more good than negative after by the way they took weeks to get input from other federal agencies.

And so let's be clear. We're doing everything we can. We're using every tool we can. We know these sand booms aren't going to protect our coast all. But they're an important strategy to fight the oil before it gets to our wetlands. In the meantime, we have deployed hard booms, soft booms, dropped thousands of pounds of sand through sandbags, filled in gaps with graters. In addition to all of that, we're now proposing, we have been proposing for weeks a sand boom dredging plan to stop the oil from getting into our marshes. These kinds of temporary land barriers or berms were already included in our area contingency plans that the coast guard had on file even before this oil spill occurred.

Let me quote for you, the Coast Guard's contingency plan says this, temporary berms, dikes and dams can also serve as effective barriers against oil contamination of sensitive natural resources and economic amenities. The plan goes on to say and I'm going to quote, the object of berms, dikes and dams is to keep oil outside an inlet because there are often abundant natural resources in economically significant areas that use the sheltered waters of bays and estuaries within. I couldn't say it better myself. That's in the coast guard's own documents. They them themselves in their own ACP say these are effective. They in their own plan says there's a reason we want to do this on the outside. We agree with the effectiveness of these kinds of sand booms. That is why we proposed 24 segments 100 miles weeks ago.

Last week, the Coast Guard only required BP to fund one of the six segments on Pelican Island. Even though we got six approved. Let me again point out to the coast guard to the federal government the effectiveness of these booms, these berms it's already laid out in our ACP. We know that sand booms work. We have seen them work. We've got pictures of them working for anybody interested. If you could bring these pictures here. These show you some of the efforts but our national guard. This picture speaks more than 1,000 words. This picture tells you everything you need to know. These land bridges, would. This was open water. They worked 24/7. Our national guard in four days built this land bridge.

What you see here, I visited here multiple times. You've got an area with hard boom in front, hard boom behind it. The oil got past the hard boom. The oil pooled at that land bridge. If this was still open water this oil would have gotten in those wetlands. Let be clear, this is the gulf here. This is about 100 miles from the oil spill. You had oil come into this area near Elmer's Island, near Grand Isle, you had oil come in here. If this land bridge hadn't been here, that oil would have gone straight in those wetlands. This on a small scale is what we're trying to do with this barrier island project. You see the various land bridges, the baskets, the air drops. National guard literally 4,000 bags of sand, you see the graters what they're doing on the ground. You see the combination, multiple lines of defense. This shows you that it works. This picture shows it all. This shows you this strategy will work.

Today, and we'll make our presentation public today. Garrett Graves did a great presentation. If you don't already have it, we'll give it to you, all of his slides, his entire presentation. We showed the coast guard and the guard today including Elmer's Island, the Cat Islands home to many brown pelicans. You've seen the image of these islands. These islands have been hit by oil again and again. Most striking evidence of the effectiveness of sand boom is to see the oil hit those islands instead of coming in to our interior wetlands. We don't want them in our wetlands. I'd rather fight them on an island than inside our wetlands.

BLITZER: So there he is. The governor of Louisiana Bobby Jindal is furious right now. The federal government he says simply not doing enough. Let's get some analysis in our strategy session, our two CNN political contributors joining us, the Democratic strategist Paul Begala, the Republican strategist Mary Matalin who is now living as we all know in New Orleans.

Paul, let me go to you first. You can't blame him for being this upset. This is a disaster. And it's getting closer and closer and closer to that coast of Louisiana.

PAUL BEGALA, DEMOCRATIC STRATEGIST: Well, and what you saw there is was a great sense of urgency. Even set aside the particulars he makes his case for these sand berms, I think the core of engineers have agreed to do some on an experimental basis, whether he's right or wrong, here's what he's conveying to his audience around the world, that he has an urgent problem. This is an emergency. If you look at the pace with which he spoke, my goodness he spoke quickly. The number of facts and statistics that he cited, that was a terrific performance there by the governor of Louisiana because he's conveying urgency. And I think that's what people want to see right now.

BLITZER: I don't know if you agree with some of the critics who have said, Mary, that the president of the United States is not conveying that same sense of urgency, the urgency we saw from Governor Jindal.

MARY MATALIN, REPUBLICAN STRATEGIST: Wolf, thank you for going to Paul first. I'm having a hard time controlling myself here. The emotional roller coaster here first the top kill doesn't work after we all had our hopes up, this sand berm, we have shown it works. We've been asking for a month. This is not rocket science. All we want is to -- we have everything here. We're not asking them for anything except to do what they are obligated by law to do, pay for us to dredge up this sand.

I don't -- what more does he have to say? A governor in parish presidents and a whole coast begging for permission to do just get out of our way. Just make BP pay for it. They don't have the funds to pay for this. We don't care what Obama's conveying. We said on this show and others when he came down on Friday and said I give you my word, we're going to help, we took that, that means something down here. We believed him. It's been four days. We still don't have the permits to do what could stop this oil from getting into the marshes which thank god CNN is showing because this is not a clean-up thing. When those marshes are dead, Paul will tell you this, he's a fisherman, they're dead, they're gone, they sink into the ocean. This is not a regenerative thing. They're gone forever.

BLITZER: He did give his word on Friday, Paul, the president of the United States. He met with all of them including Governor Jindal and the parish presidents. He said don't worry. We'll take care of it. Mary says it. Now the governor says it's Tuesday. It still hasn't happened.

BEGALA: Yeah, I listened carefully to what Governor Jindal said. There was a not too thinly veiled shot at the president in his approach. Governor Jindal a minute ago said this is not about process. This is about result. He had a lot of critics have said that the president has been too process oriented. We need to have a permit, we need to have a meeting, we need the bureaucracy to move on this. Usually process and good process protects the public interests and gets a good outcome.

What Governor Jindal is saying and I think he has the better argument politically, there's not time for process. This is an emergency. There's a general rule, for example, we don't want the government to kick our door in, but when the house is on fire, we thank god for the firefighter who has the courage to kick the door in and I think that's what the governor is saying when the federal government relies on process and here you have a governor under siege saying we just want results, I think that governor under siege is going to have the better political argument.

BLITZER: Well forget about the politics right now, Mary, this is a crisis, and you guys who live there, you need action right away.

MATALIN: Well, you know, the berm -- it's so silly. I mean, that -- this is not, it's one thing to have an argument about super tankers and vacuums and skimmers and resources and should DOD and holder's down here and we're going to -- we're going to sue BP and blah blah blah, meanwhile big sludge is wiping out the coast. There will be more coast lost from the last four hurricanes combined, and the nation -- look, I'm not -- this is not attacking the president, who's very thin skinned about this. He has a great gift. He can teach. He can tell the nation how important this coast is to all of America. This is not just a bunch of fishermen or beachfront property or anything, this is energy, fisheries, agriculture, he can teach the nation. He's missing that moment and he's missing -- I don't mean this politically, this is an opportunity to really show some competence, to step up, to take charge. It's inexplicable to me that we're even having this conversation.

BLITZER: Well, we're going to have this conversation for days, maybe weeks, maybe even a few months to come, because we're all hoping it stops, but there's no guarantee. We're going to speak to Thad Allen, who is the incident commander on the scene, that's coming up in a little while, guys. Thanks very much.

In addition to stopping the oil, it's the first day of hurricane season. You're going to find out what a big storm might do to further complicate this situation in the gulf.

And ten suicides in one factory, and it's at the company that makes parts for iPhones and iPads, we'll take you to China for an inside look. Lots of news happening today in THE SITUATION ROOM.

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BLITZER: Right back to Jack for "the Cafferty file." Jack?

JACK CAFFERTY, CNN CORRESPONDENT: Wolf, the question this hour has the gulf oil spill become President Obama's Katrina?

Paul in New Jersey writes, "Obama waited way too long. He has proven over and over again in his short time as president that he's not a leader. Thank god he wasn't president when 9/11 happened."

Jane writes, "Katrina was about the Bush administration's refusal or reluctance to deploy existing rescue teams to aid human beings in immediate danger. We don't have government leak-stopping teams to deploy. If President Obama wants to avoid part of the blame, he needs to see that the spill is really cleaned up and that BP suffers some real punishment. Take away their leases, bar them from any federal contracts, and remove the liability limits for all future spills."

Jack writes, "It ought to be considered Bush's Katrina, too, it was under his watch that the oil companies got to call the shots, with him and Dick Cheney."

Todd writes from Florida, "Let's be clear, this was a private company industrial accident, not a natural disaster. Katrina resulted in more than 1,800 deaths. This is not a fair comparison. With that said, the white house is in an unwinnable position in that they don't have the capacity to solve the problem. Until the oil stops flowing, the government's hostage to the expertise, intelligence, and technology of the oil companies."

Kathy writes, "Obama has spent a total of about three hours in the gulf coast. He gives a couple of flowery speeches and then he goes on vacation. This is not leadership. Even Bush, as much as I disliked him, did better. BP and Obama don't seem to have a clue as to what to do."

And finally Gin writes, "If you mean by this question will he get my vote next time, no."

If you want to read more on this, you can go to my blog, CNN.com/Caffertyfile. Got a lot of e-mails, some interesting responses to this.

BLITZER: Yeah, this story's generating a huge, huge reaction, not surprised, Jack, thank you.

CAFFERTY: Indeed.

BLITZER: The attempts to fix the oil spill are getting more technical, but the Obama administration is taking another step away from BP. Why? I'll ask the admiral in charge on the scene, Thad Allen, standing by to join us live.

Plus, the number three leader of al Qaeda, killed. You're going to find out why this might be a major blow to the terrorist group.

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BLITZER: You're in THE SITUATION ROOM.

Happening now, new concern of a worst-case scenario in the Gulf of Mexico. As hurricane season arrives, what would a storm the size of Katrina do to this oil disaster? We'll talk to the government man in charge on the scene, the coast guard admiral, Thad Allen.