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The Situation Room

White House Condemns Leak of Classified Reports; Interview With Mayor of New Orleans

Aired July 26, 2010 - 17:00   ET

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

SUZANNE MALVEAUX, GUEST HOST: Thanks, Rick.

Happening now, the White House condemns the leak of thousands of secret military field reports from Afghanistan, calling it a very real threat. Now the documents are fueling new suspicion and outrage about Pakistan's links to the Taliban.

Is a key U.S. ally playing a role in the deaths of American troops?

I'm going to ask Pakistan's ambassador to the U.S. about these disturbing allegations.

And the case of the disappearing oil -- why officials in the Gulf say they are not finding much crude left on the water's surface.

Wolf Blitzer is off today.

I'm Suzanne Malveaux. And you're in THE SITUATION ROOM.

Well, some are calling it one of the biggest leaks in U.S. military history, in the league of the Pentagon papers, those revelations about the Vietnam War. But today, the White House contends that there isn't much new in the thousands of Afghan war logs posted online by the group WikiLeaks. Some powerful members of Congress, well, they're not so sure. They say the documents raise some serious questions about U.S. policy toward Afghanistan and neighboring Pakistan.

I want to begin with our senior White House correspondent, Ed Henry.

And what was startling and what was -- stood out in my mind when I saw the White House today was that they are not saying that the contents -- the information inside isn't They're complaining because of the leak itself.

ED HENRY, CNN SENIOR WHITE HOUSE CORRESPONDENT: You're right, Suzanne. They are really not challenging the substance of these documents. And they're trying, in their defense, to say, look, there's not a lot new here. We've known there are problems there. And you're right about the urgency of the situation on Capitol Hill.

When you have an ally of this White House like Senator John Kerry, chairman of the Senate Foreign Relations Committee, saying basically this raises serious questions about "the reality," is how he put it, the reality of U.S. policy in Afghanistan and Pakistan, that's a problem for this White House.

So even as Robert Gibbs today attacked both the leak and the leaker, saying that the founder of WikiLeaks, you know, has an agenda and that's really what's at work here and that -- that was undermined -- that was sort of driving this leak, the sort of anti-war feeling, Gibbs never challenged the authenticity of the documents.

So I pressed him on whether these documents show that the war may just be too far gone to turn around.

(BEGIN VIDEO CLIP)

HENRY: Do these documents, then, suggest that this far -- this war is too far gone to turn around...

ROBERT GIBBS, WHITE HOUSE PRESS SECRETARY: No.

HENRY: -- with one policy change?

GIBBS: No. I don't -- I don't -- I don't -- I don't in any way think the documents suggest that. And I don't -- I haven't seen anybody to suggest that, except to say this, Ed. The -- we agreed that the direction -- this administration spent a large part of 2007 and 2008 campaigning to be this administration and saying that the way that the war had been prosecuted, the resources that hadn't been devoted to it threatened our national security.

(END VIDEO CLIP)

HENRY: So Robert Gibbs' major point really was that, you know, these documents really take you through December of 2009. And there's a pivot point there where the president had a big policy review and put together a new policy, where they're hoping to turn the page.

But the problem for the White House is that you have some of the president's own fellow Democrats, like Russ Feingold, a long time critic of the war in Afghanistan, saying today that all these documents just raise new questions and basically what makes him wonder whether or not there's just been a flawed strategy from the beginning, covering both the Bush and Obama administrations.

And so the bottom line is, this is only going to put more pressure on this president at a very delicate time in Afghanistan right now.

MALVEAUX: So, Ed, "The New York Times" reported Sunday that these military field documents included the release that suggests that Pakistan, which is clearly a very strong ally in the United States in the war against terror, has been running something of what they are calling a double game.

HENRY: Right. And basically that while Pakistan is saying one thing in public and private to U.S. officials about working together, that behind-the-scenes, some of their intelligence officials are in cahoots, essentially, with the Taliban, to go after U.S. troops, go after Afghan officials.

Now, Robert Gibbs, again, is trying to say, look, those allegations are not new. We've known that before. And he pointed out that in early 2009, the president himself gave a speech in which he said there would no longer be a blank check for Pakistan.

But what Robert Gibbs did not mention is that only a week ago, the secretary of State seemed to be saying the opposite. And instead of saying no more blank check, was saying that both sides are working together, the U.S. and Pakistan.

And I pressed him on whether these documents undermine that claim.

(BEGIN VIDEO CLIP)

(CROSSTALK)

HENRY: Secretary Clinton said that the U.S. and Pakistan are, quote, "partners joined in common cause."

GIBBS: Yes.

HENRY: Despite these documents?

GIBBS: Yes...

HENRY: The U.S. and Pakistan are joined in common cause?

GIBBS: Yes, in fighting -- in fighting, as I just mentioned a few moments ago, in fighting extremists that are within that border.

(END VIDEO CLIP)

HENRY: So again, the White House insisting that they're joined together in fighting extremists.

But is Pakistan working with the Taliban?

If they were -- we don't know for sure, but these documents are raising that question -- it would certainly make you wonder whether or not the war is going well, if Pakistan was working with the Taliban.

Big, big questions for this White House -- Suzanne.

MALVEAUX: OK.

Ed Henry.

Thank you so much, Ed.

Well, WikiLeaks' founder is going to be a guest on LARRY KING LIVE tonight. That's at 9:00 Eastern.

Now, a closer look at the allegations against Pakistan raised in the leaked war logs and reaction from Pakistani officials.

Our CNN's Reza Sayah in -- in is Islamabad.

REZA SAYAH, CNN CORRESPONDENT: Pakistani officials on Monday rejecting the WikiLeaks' reports, one military official describing them as "ridiculous" and "rubbish." Of course, Pakistan has heard similar allegations before -- allegations that its top spy agency, the ISI, is playing a double game -- on one hand, seemingly helping the U.S. and NATO efforts against militants across the border in Afghanistan, but on the other hand, secretly helping the Afghan Taliban fuel the insurgency and plot attacks against U.S. and NATO soldiers.

Some in Washington and many analysts are convinced that the ISI is still maintaining relations with the Afghan Taliban to counter India's growing influence in Kabul, with the ultimate goal of securing a friend in Afghanistan once U.S. troops eventually pull out.

Pakistani officials on Monday, both former and current officials, rejected those claims. Among them, retired General Hamid Gul, the former head of the ISI in the mid-1980s.

(BEGIN VIDEO CLIP)

GEN. HAMID GUL, FORMER PAKISTANI INTELLIGENCE CHIEF: I think they are facing a defeat. And they are -- they've made a mistake. And now they are looking for scapegoats. And those scapegoats is ISI, is the Pakistan Army, the -- who they believe double crossed them. This is the first sign of defeat. I think they are -- it is only showing that anxiety that they are losing the war.

(END VIDEO CLIP)

SAYAH: So that's what you saw on Monday in Islamabad, government officials aggressively denying these allegations in WikiLeaks reports. But no doubt, these reports are going to raise more questions about the ISI, a shadowy spy agency that already suffers from a checkered past.

Reza Sayah, CNN, Islamabad.

(END VIDEO TAPE)

MALVEAUX: And Pakistan is one of the top recipients of U.S. financial aid. It's a five year, $7.5 billion package that was approved last fall. It specifically prohibits the use of U.S. dollars to fund terrorist groups, a nuclear proliferation or attacks on neighboring countries. American aid Pakistan increased during the Soviet occupation of Afghanistan in the 1980s. The aid dipped in the '90s and then peaked during the years after the 9/11 terrorist attacks.

Well, new and deadly evidence of the Taliban threat in Afghanistan. Afghan officials say that they found the body of one of two U.S. sailors who disappeared on Friday. I want to bring in our Pentagon correspondent, Barbara Starr -- Barbara, I know that, over the weekend, there was a rumor that one of them had been killed.

Now that has actually been confirmed?

BARBARA STARR, PENTAGON CORRESPONDENT: Well, Suzanne, at least Afghan government officials are saying that -- just that, that they found the body of one of the two U.S. Navy sailors who disappeared on Friday. The U.S. government not yet officially confirming that officially.

The search is still on for the two sailors, who left their compound in the capital of Kabul on Friday in a single armored vehicle; drove south into Logar Province, which is a known Taliban stronghold; apparently were spotted by Taliban; got into some sort of firefight there. That's why Afghan officials say one was killed, one captured and in Taliban hands.

This is so concerning, of course, to the U.S. military. They are briefing the families. They're trying to keep them apprised of what they do know. The search, we are told, goes on. And if there are U.S. service members in Taliban hands, of course, one of the major concerns is that they not be taken across the border into Pakistan, beyond the reach of any U.S. military rescue -- Suzanne.

MALVEAUX: OK.

Thank you, Barbara.

Disaster crews in the Gulf have been surprised at what they're not seeing and that is a lot of oil on the water. Ahead, we're going to get a firsthand report from the area near the well site.

Also, a TV office attacked in Iraq.

And Michelle Obama plans quite an impressive mother/daughter trip.

(COMMERCIAL BREAK)

MALVEAUX: We should learn more tomorrow morning if BP CEO Tony Hayward is, indeed, calling it quits. The company says any changes in its management will be announced tomorrow morning, when its earnings report is released.

In the oil disaster zone, crews are back at work on the relief well now that the weather has cleared. They're said to be making some headway toward permanently sealing the leak. They're also moving forward on the static kill. That is the operation to pump mud and cement into the well.

CNN's David Mattingly is joining us from New Orleans -- David, tell us what's the latest from -- from Thad Allen and how much damage did the storm, Bonnie, actually cause in the area? DAVID MATTINGLY, CNN CORRESPONDENT: Well, the storm was really negligible in its effect, negative on the -- on the oil. Also, it was really negligible in what it did in helping to churn it up and help disperse it. So the storm really not a factor at all, except for the fact that it set these operations back about a week.

Today, Admiral Thad Allen just laying out the schedule now for what he hopes is the end game for this well. We're looking at early next week. They're going to attempt that static kill where they're going to fill the well up with -- with drilling mud and then sometime after that, they're going to go on through with the relief well, drilling into the well and intersecting it and filling it up with cement. So all of that playing out beginning early next week.

MALVEAUX: David, you went to the rig site.

Tell us what you saw.

MATTINGLY: Well, we flew over the site with the Coast Guard. We saw all the pieces coming back into place -- the drilling rigs and all the vessels associated with those -- that work that's going on out there. One thing we did not see, though, were the huge patches of black oil that sort of has become the face of this disaster out there.

What's been happening since that well has been shut down and the cap has been holding, there's been no new oil coming out for over a week now. And those skimmers have been going after the patches of oil that were up there. You look at that and couple that with the natural degradation that goes on as this becomes more diffuse and more dispersed, and they're coming up with less and less oil, as they continue their operations out there. I've talked to the Coast Guard commander in charge of that and he described it as a problem that's pretty much good to have right now.

(BEGIN VIDEO CLIP)

REAR ADMIRAL PAUL ZUKUNFT, FEDERAL ON-SCENE COORDINATOR: This oil is rapidly breaking down. And there's very little oil left. We have a few streamers that we located earlier off of Grand Isle that perhaps can be skimmed. But right now, we're not seeing many targets for -- for our skimming fleet of 780 skimmers.

MATTINGLY: You realize when you say that, it's so hard for people to believe, that this spill was so enormous and yet you're having trouble finding the oil to skim it?

ZUKUNFT: Well, it's not for lack of trying. We've had 50 aircraft saturating this -- this very location where satellites indicate there could be an oil sheen in the area.. And so we're going to look just like we would during search and rescue, to see where any possible target -- pocket of oil might be over this area.

(END VIDEO CLIP)

MATTINGLY: And to punctuate this point, Suzanne, before the cap was put on, they were collecting about 25,000 barrels of oil off the surface out there. That was every day. And one day last week, they only collected about 56 barrels. So that shows you how the big amounts of oil that was on the surface quite -- isn't quite there anymore and they're now having to hunt for those smaller pieces that are proving to be a little more elusive.

MALVEAUX: So, David, with the less oil in the water, at least what they're finding here, what happens to that program that pays fishermen essentially to clean up the oil?

MATTINGLY: Well, the Vessels of Opportunity program is still in full swing. In fact, their role is a little bit more important now, in fact, because as that oil gets harder to spot from the air, they need more eyes on the water to keep an eye on it and -- and watch where it might be going. So they're doing a lot more monitoring out there, even though they're not collecting quite as much.

They're the ones who are going to have to be able to watch where those tar balls are forming, where they might be churning up in the surf and where they might be having a shore impact. So their role still not diminished at all, even though the oil seems to be diminishing.

MALVEAUX: OK. David Mattingly, thank you for that excellent report.

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

What are you working on?

LISA SYLVESTER, CNN CORRESPONDENT: Hey, there, Suzanne.

Well, more than two dozen people are dead in Iraq, victims of three bombings. The first happened in Central Baghdad when a suicide bomber drove a bus into the compound of Saudi funded Al Arabiya TV. At least six people were killed. Later, two car bombs exploded on the road between Karbala and Najaf, killing at least 19 people there. Police say most were Shiite pilgrims bound for Muslim celebrations in Karbala.

Lawyers say police are questioning one of France's richest woman about claims that one of her advisers paid off high level officials, including French president, Nicolas Sarkozy. The charges stem from secret recordings allegedly made by L'Oreal heiress Liliane Bettencourt's butler. The recordings were published last month and are alleged to be of conversations between Bettencourt and a financial adviser. In them, Mr. Sarkozy and France's labor minister are named as recipients of envelopes of cash. Both have denied the allegations.

And First Lady Michelle Obama will travel to Spain next week. The White House says she is going on a quote, "private mother/daughter trip" with longtime family friends. Mrs. Obama will pay a visit to Spain's King Juan Carlos and Queen Sofia. President Obama will not be going on this trip.

And the chariot once owned by Egyptian King To -- King Tutankhamen, AKA, also known as King Tut, well, that chariot is going to go on exhibit next week in New York. Egypt's antiquities chief says this is the first time -- you see a picture of it there -- the 3,300-year-old chariot will travel outside the country. He says it is possible that the young king fell off the chariot during a hunting trip, resulting in his death. It and other artifacts will soon be permanently housed in a museum near the Great Pyramids at Giza.

And what about that trip that First Lady Michelle Obama is taking?

That's going to be something else.

MALVEAUX: Now, that sounds amazing. That's just fantastic.

And that chariot there, I saw that when I lived in Cairo, Egypt.

SYLVESTER: Oh?

MALVEAUX: Yes. It was part of the museum there. So it's good to see it's -- it's leaving and a whole bunch of other folks will be able to see it, too.

SYLVESTER: Yes, that's -- I mean that's -- it is a pretty rare thing for them to -- to allow these artifacts to leave the country. So it is going to be quite a treat. And it's going to be in New York, so not too far from us -- Suzanne.

MALVEAUX: An excuse for a visit.

Thanks.

Well, a debate over taxes intensifies as a deadline approaches.

What should Congress and the president do when the Bush tax cuts expire, extend them or let them go?

And he says the U.S. and Pakistan are strategic partners, but we'll ask the Pakistani ambassador to the United States if his country's spy agency is plotting with the Taliban on the side.

(COMMERCIAL BREAK)

MALVEAUX: Now to a looming ethics trial of a powerful Democrat Congressman, Charlie Rangel.

Will he cut a deal with the Ethics Committee before the charges against him are unveiled on Thursday?

Our Congressional correspondent, Brianna Keilar, is here to talk about what we expect in the next couple of days -- Brianna.

BRIANNA KEILAR, CNN CONGRESSIONAL CORRESPONDENT: Well, Suzanne, right now, as we speak, Democratic leaders are having their weekly meeting. And if they are not talking about it, well, the elephant in the room is what to do about Charles Rangel, because Democratic leadership aides tell us that there is a growing unease within the party -- a lot of folks concerned that this could be quite a public spectacle leading up to a very tough mid-term election. And this is, of course, set to begin on Thursday, where we are expecting to learn about what alleged violations -- alleged ethical violations that Rangel is facing.

You know, we know that he failed to pay taxes on the earnings from his rental property in the Dominican Republic. We know he failed to disclose hundreds of thousands of dollars of assets. But there could be other surprises. And Democratic leadership aides are telling us the Democrats really -- they want to avoid this spectacle, that leaders are hoping that Rangel is going to come to some sort of settlement with the Ethics Committee to kind of avoid such a -- a -- a visible situation.

But those aides also tell us, Suzanne, that they're not actively -- that leaders are not actively pressuring Rangel to do that. In fact, Speaker Pelosi told a bunch of us reporters a short time ago that this process is going to play out, that the timetable has been set by the Ethics Committee and they're waiting for it to play out -- Suzanne.

MALVEAUX: So what is Congressman Rangel saying about this?

Is he -- is he talking at all?

KEILAR: Well, he is talking. And what's interesting, something that he said in New York earlier today. He's not giving any public signals that he, himself, is coming to some sort of settlement with the Ethics Committee.

Listen to what he said a few hours ago.

(BEGIN VIDEO CLIP)

REP. CHARLES RANGEL (D), NEW YORK: I can only hope that -- that all the facts come out before my primary -- before my general election, because it is like a wall that's been building up for close to two years. And -- and it's going to burst on Thursday. It may not be pleasant, but it's going to give me a sense of relief. At least we'll know where we're going.

But it's painful to have to say, "no comment," when people are attacking the very -- the very reason that you exist.

(END VIDEO CLIP)

KEILAR: So he says there that this bubble is going to burst on Thursday.

But here is the very real political partisan battle that is playing out over this. The Republican Committee -- the House Campaign Committee -- is targeting Democrats who have accepted campaign donations from Rangel. And already, some of them feeling the heat -- Suzanne, at least two of them so far have said they're going to take the donations they've received from Rangel and donate them to charity.

MALVEAUX: OK, Brianna.

Thank you very much.

Well, it sure seems like great news for the Gulf Coast -- the oil that has been tainting the water for months appears to be breaking up. I'll ask New Orleans' mayor, Mitch Landrieu, what he has been out on the water and seen and whether residents should be relieved.

And if BP's CEO, Tony Hayward, gets ousted tomorrow will he have a soft landing?

(COMMERCIAL BREAK)

MALVEAUX: You're in THE SITUATION ROOM.

Happening now, thousands of leaked documents raise questions about U.S. relations with Pakistan.

Is the strategic partner secretly in bed with the Taliban?

We're going to go straight to the source, the Pakistani ambassador to the United States.

And no confirmation yet, but speculation is growing that BP chief, Tony Hayward, is on his way out. What's more, an American may be waiting in the wings to take over.

Wolf Blitzer is off today.

I'm Suzanne Malveaux. And you're in THE SITUATION ROOM.

It may sound just too good to be true -- much of the oil that gushed into the Gulf for months now seems to have disappeared, at least from the surface of the water. And we are told now that crews are making progress for drilling a relief well and plugging the leak for good.

I want to bring in the mayor of New Orleans, Mitch Landrieu.

Thank you so much, Mayor, for joining us here.

MAYOR MITCH LANDRIEU (D), NEW ORLEANS: Great to be with you.

MALVEAUX: Thank you.

I understand you had a chance to see the well site, take an aerial tour yesterday. Describe for us what it is that you saw.

LANDRIEU: I did. I was able to take a flight over with the Coast Guard. There were -- there were a huge number of boats that were out there that had gotten back to work very quickly after the threat of the tropical storm passed. And, of course, that was -- that was welcome news.

There didn't appear to be any oil on the surface anywhere around where the wellhead was. The closest oil that we saw was about 90 miles from there. So that's always very welcome. It appears as though they're getting very close to making sure that the oil is capped. And, of course, that's welcome news.

But this is not the beginning of the end. This is just the beginning of the beginning. And it's very important for everybody in America to understand that we have a very, very long way to go. This is a sprint -- this is a -- a marathon, it's not a sprint.

MALVEAUX: And, Mayor, explain to us -- some of us are somewhat confused about why we're not seeing more oil now. There was so much oil in the water.

Do we think that it's under -- underwater in plumes?

Has it been dispersed?

Has it been eaten by the bacteria?

Where has this oil gone?

LANDRIEU: Well, I'm not -- I'm not exactly sure. They -- they have -- they have exact amounts of -- of how much they've capped. And we saw some emulsified oil about 11 miles off of Grand Isle, which gave us concern. The Coast Guard deployed as Maine skimmers as they had in the port and they are in the process of capturing that right now. The most important thing though has been to cap that well where the biggest problem has been up to date. So again that's welcome news but as I said we've been through a number of different catastrophes down here. We know what the long haul is going to be and we want to be sure there is a total and complete commitment to do all that is necessary, capture all the oil that's out there, make sure that we clean the coast, compensate all the victims and begin to put people back where they were before and really make it right.

MALVEAUX: Just to be clear the fact that you're not seeing this oil, is that a welcome sign or does that concern you and worry you that the oil may just be somewhere where we haven't seen it?

LANDRIEU: I have a little concern about that but it gives us great hope if in fact we captured the well. There were huge numbers of gallons coming out of barrels per day, and capping it is really the most important thing. We now have to capture it and go find where the oil went that we haven't been able to see yet. Again that's why I said this is not the beginning of the end but just the beginning of the beginning. We have a very, very long way to go but of course you take anything you can get. It's a welcome first step.

MALVEAUX: We welcome that first step. We saw the handling of tropical storm bonnie. How do you think that went? Do you think it went well? Was that a dress rehearsal for possibly bigger storms to come? Do you think it was a success?

LANDRIEU: Yes, it was. We had a little hiccup last week with coordination between the state and the coast guard. We were able to regroup and make sure that our plans were in sync so it gave us an opportunity to find that weak link. Obviously we think that we have more storms coming. All the storm tracks say we'll get more of them. We have to be prepared. We have a lot of opportunities to drill down. We feel pretty good about where we are but you have to be ready for the unexpected.

MALVEAUX: Are things turning around economically for the city of New Orleans? Are we seeing some positive signs?

LANDRIEU: Well, not yet. We have a long way to go on this thing. With the moratorium, with the number of people out of jobs with the fisheries, with the tourism industry taking a 10 to 16 percent hit it isn't a great time for us. We have to continue to struggle back which is why I want to help the nation stay focused on the fact that capping the well is not the beginning of the end but the beginning of the beginning and we have a very long way to go.

MALVEAUX: We may see the CEO of BP Tony Hayward leaving his post. Do you have any final messages, good riddance or any well wishes? What are your thoughts?

LANDRIEU: Let me say this. It's a welcomed change but just changing faces and not changing corporate philosophies doesn't really get you anywhere. The people in the gulf south want to know that BP is completely and totally committed to completely making it right and that means not leaving just because the well is capped. It's important. You have to capture the oil, you got to clean the coast, make sure everybody gets compensated and then start thinking about how BP is going to completely make it right long term for what it is they've done down here. When we see that kind of commitment, when we see that kind of change in corporate philosophy we'll feel a lot better than them just changing out the chief executive. We welcome Mr. Dudley and look forward to a wonderful relationship with him. We hope we have one but we need to see more. We're not in a very trusting mood right now and we hope it changes in the future.

MALVEAUX: Thank you, Mr. Mayor. Appreciate your time. Thank you.

Arizona's tough new immigration law takes effect in just days. But the state isn't the only place where this issue is boiling over. Ahead, fear and illegal immigration in Middle America.

And President Obama gets ready to chat with the ladies of "The View." It's a hot topic for Donna Brazile and Bill Bennett in today's strategy session.

(COMMERCIAL BREAK)

MALVEAUX: This Thursday Arizona's controversial immigration law takes effect unless the federal judge puts it on hold while a justice department challenge is considered. This week we are looking more closely at this contentious issue that reaches every corner of the country including a small town in the U.S. heartland. Here is CNN's Dan Simon.

(BEGIN VIDEOTAPE) DAN SIMON, CNN CORRESPONDENT: Surrounded by cattle and corn fields, Fremont, Nebraska is the kind of place that feels insulated from the nation's big problems especially illegal immigration. Just look on a map. Mexico is a long ways away from Nebraska, about a thousand miles. But the immigration battle has reached the heartland and this town outside of Omaha of only 25,000 people.

JERRY HART, LED PETITION DRIVE: You look at the flooding situation and you going to wait for FEMA to come take care of you or are you going to start sand bagging your own house so you don't get flood waters? That's what we're trying to do.

SIMON: Jerry Hart, a retired IRS agent, and John Weigert, an elementary school teacher, led an effort to put a measure on the town's ballot that bans hiring or renting property to illegal immigrants. It passed last month by a decisive 57 percent of the vote.

Why does a city like Fremont smack in the middle of the country need an anti-immigration law?

JOHN WEIGERT, LED PETITION DRIVE: We are for immigration. We're just against illegal aliens coming in bringing drugs, gangs, crime, and an economic burden that is going to grow for years if we don't do something in our town.

SIMON: Yep, it's the identical argument used by anti-illegal immigration hawks around the country even though police dispute the crime here is on the rise. But like many American cities, Fremont's Hispanic population has risen significantly from an estimated 200 in 1990 to about 2,000 now. Fremont's Hispanic population has surged in recent years with the promise of a steady job at the area's meat packing plants. The city has a low unemployment rate but according to supporters one of the primary arguments for the measure is that illegal immigrants are taking away jobs from American citizens. Nothing makes this woman's blood boil more.

MIRIAM BERGANZA, FREMONT RESIDENT: You're not going to see any Anglo Americans the lines. You're not.

SIMON: What you're saying is they don't want those jobs.

BERGANZA: They don't want those jobs. We want them because we've got to support our kids.

SIMON: Miriam Berganza, an American citizen, has worked in those plants which she says are filled mainly by Hispanics. She cannot understand why Fremont has become an immigration battle front.

BERGANZA: Fremont has grown because the illegal immigrants. It has grown. We spend our money here. We don't go nowhere else. We spend it here. So I don't see the problem with it.

SIMON: Miriam says the by product of all this is growing racial tension and a feeling of being unwanted. Kristin Ostrom fought unsuccessfully to defeat the measure in part because she thought it encouraged racial profiling.

KRISTIN OSTROM, OPPOSITION LEADER: The Hispanic community feels like people voted for them to leave. And we have people telling us day after day they're just waiting for the police to come and escort them out of Fremont.

SIMON: That's not going to happen.

OSTROM: That is absolutely not going to happen but the Hispanic community feels like they are not welcome.

SIMON: Ordinance supporters deny race played a role. It's not clear how many illegal immigrants live in Fremont. What is clear, the battle is headed to the courts with opponents like those critical of Arizona's controversial bill claiming immigration enforcement is strictly a federal matter.

Dan Simon, CNN, Fremont, Nebraska.

(END VIDEOTAPE)

MALVEAUX: So what should be the main focus of U.S. policy on illegal immigrants? That is coming up in our strategy session.

Also, it has never been done by a sitting president. President Obama makes an appointment with day time TV's "The View." Why now?

And the deadline looms for long standing Bush tax cuts. Now Congress must decide what to do next, extend them or let them slide?

(COMMERCIAL BREAK)

MALVEAUX: We enter the final hundred days to this year's mid term elections. At the same time President Obama is planning an appearance on "The View." It's the first time that a sitting president has done a day time talk show. A crafty campaign tactic or maybe a risky move? We'll see. Joining me for today's strategy session, our CNN political contributors Donna Brazile and Bill Bennett. He was on "The View" during the campaign. He was rather popular. What do you think this time around the fact that he is appearing so close to mid term elections?

DONNA BRAZILE, DEMOCRATIC STRATEGIST: I think it is refreshing to be outside the beltway to talk to the ladies of "The View" to get their view and perspective on what is going on in America. I would love to hear the president talk about jobs and what he's doing to get the economic growth back. But also I hope he will talk about some nonpolitical topics. I want to know what the president has been reading all summer, what movies he has been able to watch and, you know, perhaps he can get into some of these other noncontroversial topics and give us insight into what is going on in his mind.

MALVEAUX: Bill, he was popular among the ladies the last go round. What do you think we'll see any different this time? Do you think we'll see or hear a more relaxed president? BILL BENNETT, REPUBLICAN STRATEGIST: Well, I think it's fair to say, I think he is less popular now. He certainly is by every count. I don't think he is any less popular with Joy or Whoopi or Barbara Walters. He is probably holding up very well with that group and with a lot of the other ladies on "The View" but he's the president and should go where he thinks he can have the most impact and talk about whatever he wants to talk about. However what the country wants to hear about is jobs, economic recovery and that report from the white house itself today was not very encouraging on those fronts but if he thinks "The View" is a good place to get out his point of view, fine. That's what the media is for, for a president to use in that way. I just hope they ask him some questions that are fairly probing.

MALVEAUX: I suppose he'll talk about jobs and the economy. I want to point to what is happening, very big story at CNN is following the immigration law that could very well go into effect as early as Thursday in Arizona. We know on the Arizona side the police have a 90-minute video for training to make sure the officers carry out this law in a way that is legal and sensitive and we know there are also Latinos being trained in church groups and advocacy groups to make sure they know how to deal with the police and try to avoid perhaps what some believe will be subject to racial profiling. Do you think this is the correct approach as both of these sides gear towards dealing with this new immigration law?

BRAZILE: Absolutely. Look, the American people are really frustrated. They're frustrated that we haven't been able to solve the immigration problem and we cannot get the undocumented workers to come from the shallow. We can't stop employers from hiring illegal immigrants but what they should know is that over the last two years we've seen a sharp decrease in the number of people coming over the border. Border security is up at an all time high an would hope everyone from the police officers to those out there in the community would recommend everyone remain calm that this law would be implemented in a fair way, not a prejudiced way and perhaps we can let this chapter get behind us. Congress needs to act and it is time to put aside partisanship and act on giving us a comprehensive immigration bill.

MALVEAUX: Bill, respond to this latest poll, CNN Opinion Research Corporation poll, that shows that more Americans prefer deporting and stopping the illegal flow of immigrants the question being the plan should be plan to allow them to become legal residents of the United States, 42 percent, deporting them and stopping more from coming to the United States, 57 percent. Has the Obama administration been out of touch when it talks about comprehensive immigration reform?

BENNETT: Yes, it is out of touch frankly but if it wants to remain out of touch because this is what it believes the president can express that on "The View" and any place else. If you take Arizona, Suzanne, for example, 57 percent of Americans believe that law is right and an additional 17 percent don't think the law goes far enough. That's 74 percent. Yeah, he is out of touch. People have had it and the people of Fremont, Nebraska like a lot of other people have had it. In that piece Mr. Simon said any immigration hawks who believe illegal workers should be arrested, it is against federal law to hire people knowing they are illegal and this is what we have raids for. This is the rule of law and we need to live in it. I'm glad the police have a training film so they are very careful. You can be sure if anything of them do anything inappropriate we'll hear about it and I hope that the video that's being used is one that says cooperate with police. They represent the will of the community, do things that are proper and of course if anything improper happens go through channels. But the most interesting thing right now in Arizona is this challenge by the justice department to the Arizona law. We'll all be interested to see what comes out.

In the poll you all have done I see a lot of common ground. One very encouraging thing is most Americans do not think these laws are racially motivated. Even a majority of Hispanics do not think these laws are racially motivated and that is the kind of common ground that Donna is --

MALVEAUX: Donna, you get the last word.

BRAZILE: I agree. Let's not target people simply because of their ethnic background, their racial heritage. But, Bill, I hope that those in the community, the church leaders and others who are there are talking with the Latino community and the broader community and I hope they can also find common ground so this is not pitting people against each other. People are tired of that and let's hope that this situation on Thursday when the law is implemented is one that no one will be harmed by.

MALVEAUX: All right. We've got to leave it there. Donna Brazile, Bill Bennett, thank you so much for joining us.

Pakistani officials are rejecting allegations they are helping the U.S. and the Taliban at the same time. I'll ask Pakistan's ambassador to the U.S. about thousands of pages of leaked war documents. Also, some senators aren't taking no for an answer as they investigate BP's possible link to the release of the Lockerbie bomber.

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MALVEAUX: President Obama comes out swinging over Republican opposition aimed at blocking a Senate vote on campaign finance reform. Mr. Obama blasted the GOP for what he called partisan gamesmanship that he says threatens to favor special interests in the election. He's pressing the Senate to pass the so-called disclose act. It would require donors in campaign ads be identified.

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OBAMA: You'd think making these reforms would be a matter of common sense, particularly since they primarily involve just making sure folks who are financing these ads are disclosed. Nobody is saying you can't run the ads. Just make sure that people know who, in fact, is behind financing these ads.

(END VIDEO CLIP) MALVEAUX: The measure was written in response to the Supreme Court's controversial ruling that reversed a campaign reform bill that was limiting corporate and union spending on elections.

Well, we are now 99 days out from the midterm election, just 99 days and the political fight over taxes is now intensifying. Tax cuts from the Bush era are due to expire at the end of the year. Now, President Obama wants to let the tax cuts lapse for families that earn more than $250,000 a year. But Republicans now are saying that that's going to hurt the economy.

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REP. MIKE PENCE (R), INDIANA: Democrats in Washington are now actually talking about embracing what would be the largest tax increase in American history. Let me say that again. After 18 months of runaway spending, bailouts and takeovers, Washington Democrats are poised to allow the largest tax increase in American history to take effect next year.

TIMOTHY GEITHNER, TREASURY SECRETARY: The right thing for the country, the fair thing, the responsible thing for the country now is make sure we leave in place and preserve tax cuts that go to more than 95 percent of working Americans and complement those with a set of incentives for businesses to expand and hire. To make that possible and to do that responsibly I think it's a fair and good policy to allow those tax cuts that only go to the 2 percent or 3 percent of the highest earnings in the country to expire as scheduled. The country can withstand that. The economy can withstand that. I think it's good policy.

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MALVEAUX: We want to bring in our senior political analyst Gloria Borger. You know when they put out the treasury secretary for two major networks, that they are fighting, that they are now in battle mode over this very issue.

GLORIA BORGER, CNN SENIOR POLITICAL ANALYST: Right.

MALVEAUX: It was tough for the Republicans under President Bush, pushing forward on the tax cuts, because they knew they had to expire because they were very expensive.

BORGER: Yeah, very.

MALVEAUX: Where do we stand on this? Does it hurt them now?

BORGER: It's interesting. Let's go back to when that occurred. That was 2001-2003 as you recall. We had something called surpluses then. You remember that? And the whole notion was give people back their money. But even members of Congress figured out that by the year 2010 there could be some deficits and this would cause some deficits and so here we are on the brink facing an election and January 1, these things expire. And people have very different ideas about how to deal with it. MALVEAUX: Now we've already seen some of the moderate Democrats raise some concerns over the weekend. Several senators said kook, maybe this is not a good time because we're just getting out of this recession right now. Is it a safe political position for President Obama?

BORGER: No, it's not a safe political position on either side. But I think President Obama made a pledge during the campaign which was he wasn't going to raise taxes on any families making $250,000 or less. That's now middle class in this country. And he's also confronted with the problem about the deficit because most people in this country are very concerned about the deficit. So his sense is, and you heard Secretary Geithner say look, if you care about the deficit, let's raise taxes or repeal this tax cut for folks, let it expire, for folks in the top 2 percent to 3 percent. And that would save about $700 billion. If you were to extend these tax cuts, as Republicans want to do, you're talking $2 trillion added to the deficit. So the Democrats are trying to turn the deficit argument on its head and use it against Republicans. Republicans, by the way, they're not afraid of it at all. They're like come on into the wheel house folks. We're happy when we're talking taxes.

MALVEAUX: What do we think, just as Americans, what do people think more about being taxed? More or less?

BORGER: I think most Americans are in the middle class and they want to keep their tax cuts and the Democrats are banking the fact that, you know what? Let's this tax go back up for the wealthy. And by the way, you're talking about taking the taxes to where they were when Bill Clinton was president, which was 39.6 percent. My prediction, though, they may kick this can down the road. Wait for the deficit commission to report on December 1.

MALVEAUX: I'm going to bet on your side. I'm going with you, Gloria.

BORGER: Don't bet against me.

MALVEAUX: Thanks, Gloria.

We're drilling down on those leaked documents in the Afghanistan war. Will the revelations help protect U.S. troops or put them in harm's way?

And imagine you were told that your daughter died in a car crash, only the hospital got her identity wrong.