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The Situation Room

GOP Hopefuls in Florida; Interview With DNC Chair Debbie Wasserman Schultz; Newt Gingrich's Critics From Congress; President Obama's Joke Doesn't Generate a Lot of Laughs

Aired January 26, 2012 - 17:00   ET

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

WOLF BLITZER, HOST, CNN'S THE SITUATION ROOM: And to our viewers, you're in THE SITUATION ROOM. Happening now, a vicious shooting spree targeting the Pentagon and other military buildings as seen through the eyes of the actual shooter. You're about to see chilling video he recorded. And it has just been released also.

The son of a prominent Obama cabinet secretary banned, prevented from leaving Egypt, and now, he's speaking with CNN about his condition and what's being done to get him out.

And President Obama's joke flops at the "State of the Union" ahead. Why it may not necessarily be so funny to cry over spilled milk.

We want to welcome our viewers in the United States and around the world. Breaking news, political headlines all straight ahead. I'm Wolf Blitzer at the University of North Florida in Jacksonville. You're in the SITUATION ROOM.

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BLITZER: We're here on the beautiful campus of the University of North Florida in Jacksonville where just three hours from now I'll be moderating the last Republican presidential debate before Florida voters make their choice in a fiery battle for the White House with primary coming up on Tuesday. We'll get to a lot on that.

But first, just getting the shocking video. A shooter recording himself in action as he terrorized the Washington, D.C. area, firing shots in a number of military buildings, including the Pentagon. Our Brian Todd was in court today with the 23-year-old former reservist.

BRIAN TODD, CNN CORRESPONDENT: Wolf, prosecutors say Yonathan Melaku's motive in the shootings was to create fear throughout this region. To prove their point, they released a dramatic video made by the shooter himself.

(BEGIN VIDEOTAPE)

TODD (voice-over): October 29th, 2010, as he drives, Yonathan Melaku points his camera toward the marine corps museum in Northern Virginia and speaks. UNIDENTIFIED MALE: That's a military building.

TODD: Minutes later, he points his gun at the museum.

(GUNFIRE)

TODD: Then, he cries out. Later, his face is clearly visible. Then, he makes another pass at the museum. This time, the shots are not as visible.

(GUNFIRE)

TODD: This video made by Melaku, himself, released by prosecutors, a key piece of evidence against the former marine reservist who's pleaded guilty to injuring government property and firearms violations. It's connected to the shootings at the Marine Corps Museum, the Pentagon, and two military recruiting stations in Northern Virginia in the fall of 2010. No one was injured in the attacks, but --

DANA BOENTE, ASSISTANT U.S. ATTORNEY: During this video, he explains his motives to create fear and terror and to close the marine museum.

TODD: I looked at the video with veteran criminal defense attorney, Jeffrey Jacobovitz.

Was this the piece of evidence that really became a slam dunk for a guilty plea?

JEFFREY JACOBOVITZ, CRIMINAL DEFENSE ATTORNEY: Well, let's assume that he's alone in the car, it would then be a slam dunk, but I think in terms of the guilty plea, as a defense council, I would not jump into it and I'd first ask for a psychiatric evaluation.

TODD: Prosecutors say there's no evidence anyone else was with Melaku during the shooting spree. And his defense attorney has asked for a psychiatric evaluation, but says Melaku is sane. The lawyer wants him tested for anger management issues. Before the shootings, a military official says Melaku had failed a combat fitness test.

Prosecutors say this is a case of homegrown extremism. When he was arrested at Arlington Cemetery last June, officials found bullet casings, Arabic statements referencing al Qaeda, and ammonium nitrate use to make IEDs in his backpack. What did he plan to do at Arlington?

JACQUELINE MAGUIRE, FBI SPECIAL AGENT: His state of intention was to desecrate the graves of veterans of the recent wars in Iraq and Afghanistan.

TODD: Prosecutors and Melaku's attorney agree to a 25-year sentence.

(on-camera) Did he adopt some kind of stance towards waging jihad against the United States? UNIDENTIFIED MALE: No.

TODD: As he walked away from the courthouse, Melaku's father told me his son is good person, who respects his parents and authority. When we asked if his son has anger management issues, the father said he wasn't sure, that they'd have to wait for an evaluation -- Wolf.

BLITZER: All right, Brian. Thank you.

Let's go to the state department right now where there's growing concern and outrage over the fate of a prominent cabinet secretary's son who has now been barred from leaving Egypt in the wake of heightened tensions in the region that have the United States deeply, deeply disturbed.

Let's bring in our foreign affairs correspondent, Jill Dougherty. She's over at the state department. She spoke with the transportation secretary, Ray Lahood's, son just a little while ago. All right. What's going on here, Jill?

JILL DOUGHERTY, CNN FOREIGN AFFAIRS CORRESPONDENT: This really is the last chapter, only the last chapter in this ongoing crackdown by the Egyptian government on groups who support democracy building in Egypt.

(BEGIN VIDEOTAPE)

DOUGHERTY (voice-over): Sam Lahood tells CNN he tried to get out of Egypt last Saturday for a short trip to Doha to see a friend but was turned back by Egyptian authorities. We reached him by phone at his apartment in Cairo.

(on-camera) Sam, do you feel safe where you are at this point?

VOICE OF SAM LAHOOD, INTERNATIONAL REPUBLICAN INSTITUTE: You know, I feel safe physically. You know, obviously, the fact that the investigative judge chose to prevent some of us from traveling is something that our lawyer tells us indicates that, you know, this investigation has taken on more serious nature. And the next step from here would either be arrest or go to trial.

DOUGHERTY: The 37-year-old is Egypt director for the influential U.S. non-governmental organization, the International Republican Institute. He's one of five IRI staff on the no-fly list along with staff from other U.S. NGOs.

His offices, along with those of other NGOs, were raided last month by Egyptian security forces. His father, transportation secretary, Ray Lahood, tells CNN he's in constant contact with his son.

RAY LAHOOD, TRANSPORTATION SECRETARY: Well, there are a lot of people working on that, so we'll see how it works out.

DOUGHERTY: Sen. John McCain, chairman of IRI, blasted Egypt for what he called an outrageous move. "I fear for the safety of all the employees at these NGOs, Americans, Egyptians and others," he said, "especially those who've been barred from leaving the country. Sam Lahood's boss says this is the first time in 30 years IRI has been through anything like this.

LORNE CRANER, PRESIDENT, INTERNATIONAL REPUBLICAN INSTITUTE: The accusations as best we know them at this moment are you are not registered, and we have been trying to get registered for 5 1/2 years. And number two, you do not have the kind of bank account you would have if you were registered. And again, we've been trying to get that status for 5 1/2 years.

DOUGHERTY: President Obama, meanwhile, raised the issue of NGOs with Egypt's military ruler. Secretary of state, Hillary Clinton, has talked with the foreign minister, but it's a delicate balance. Stick up for the Americans without interfering in Egypt's judicial system.

VICTORIA NULAND, STATE DEPARTMENT SPOKESWOMAN: We are urging the government of Egypt to lift these restrictions immediately and allow folks to come home as soon as possible, and we are hopeful that this issue will be resolved in nearest days.

(END VIDEOTAPE)

DOUGHERTY (on-camera): Now, there's a lot of anger, obviously, building here in Washington about this, because after all, Egypt is the largest single recipient of U.S. foreign aid in the entire world. Pulling the plug on that aid could actually hurt, damage Egypt when it already is fragile economically and politically -- Wolf.

BLITZER: You know, Jill, correct me if I'm wrong, I think Israel does in terms of military and economic assistance, especially military systems got a little bit more than Egypt does, but how endangered is the billions the United States does provide Egypt every year if this continues?

DOUGHERTY: Well, you know, it's a dilemma, Wolf, because, obviously, the people who are angry on Capitol Hill would like to punish Egypt. And yet, if you do that, everyone here at the state department and who really knows Egypt says that it's in a very bad economic shape. Politically, there's a lot of chaos.

And so, you don't want to really toss it over the edge. It's the one country, a very major country after the Arab spring that really does have to succeed. So, it's a dilemma.

BLITZER: Certainly is, and we'll see what happens. Let's hope for the best. Thanks very much. The stakes are enormous for the United States and the Middle East right now.

The two kidnapped aide workers free during that daring U.S. military operation in Somalia are now in a U.S. base in Italy. And the father of the American woman, Jessica Buchanan says he's hoping to reunite with her today, but wouldn't say where. U.S. special operations force including the team that killed Osama Bin Laden made the rescue this week. The two hostages were seized by Somali pirates three months ago.

While the Republican presidential candidates are getting ready for the battle right here in Florida, their archrival, the president of the United States, President Obama, has just touched down in Colorado. The fourth key state on a three-day tour to potentially help him get re-elected.

Our chief White House correspondent, Jessica Yellin, is traveling with the president. Jessica, the president focused today on manufacturing. He's getting ready, obviously, for his re-election campaign. What happened today?

JESSICA YELLIN, CNN CHIEF WHITE HOUSE CORRESPONDENT: Today, Wolf, he's pressing an agenda on focus on energy. He has talked about expanding U.S. extraction of natural gas, looking at new alternative energy sources, and also offshore oil drilling. Here's what the president said earlier.

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BARACK OBAMA, PRESIDENT OF THE UNITED STATES: Today, I'm announcing that my administration will soon open up around 38 million acres in the Gulf of Mexico for additional exploration and development which could result in a lot more production of domestic energy.

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YELLIN: Now, Wolf, obviously, this has a lot of implications for the campaign, because folks, voters are worried about gas prices. There's also the attacks he will no doubt get from Republicans over his decision not to approve that keystone pipeline. So, he has to try to show that he's looking at other ways to bring more gas and oil exploration here in the U.S.

But as soon as he makes that move, he opens himself up to criticism by environmentalists, and people on the left for any type of natural gas exploration or oil drilling he does in the U.S. So, he's suck (ph) in a bit of a box no matter what he does and get criticism from either the right or the left, it seems, Wolf.

BLITZER: Sort of comes with the territory. I don't know if you heard Lisa Sylvester's report just a little while ago about Ener1, another one of the so-called green energy companies that received stimulus money from the federal government but has now gone bankrupt. Is the White House reacting to this?

YELLIN: The Department of Energy has put out a statement, and they are saying it's a shame that the parent company, Ener1, has filed for bankruptcy, but they point out that the project that the Department of Energy which is called Enerdel is still up and functioning, and that those operations will not lose any employment at the site.

So, their point is that the project that they funded is still doing fine. The parent company is undergoing restructuring. So, we'll have to see how that one plays out that in the end. Finally, Wolf, I'll point that my producer, Ted Metzger (ph), has learned that the president is likely to say in his remarks here that just because some of these companies end up filing -- have trouble, that doesn't mean that, sometimes, we should still try as a nation to invest in new energy sources -- Wolf.

BLITZER: Jessica Yellin traveling with the president, thank you.

A fuming Newt Gingrich tears into Mitt Romney's campaign.

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NEWT GINGRICH, (R) PRESIDENTIAL CANDIDATE: And we're not stupid. The message we should give Mitt Romney is, you know? We aren't that stupid and you aren't that clever.

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BLITZER: Up next, you're going to find out what triggered this fiery new attack. And it may be -- it may pay to be president of the United States, but pays even a lot more after you leave the White House. Ahead, how past presidents turn into multimillionaires.

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BLITZER: Jack Cafferty is here with the "Cafferty File" -- Jack.

JACK CAFFERTY, CNN CONTRIBUTOR: As the Republican candidates get ready for yet another face-off in Florida at tonight's CNN debate, there's a growing focus on what happens offstage during these things. A piece in the "New York Times" this morning asked if the news media has been creating too raucous an atmosphere by encouraging audiences to react in order to create better television. We wouldn't do that.

There's no question these debates are much more lively when the audience participates from applause to cheers, even the booing is fine. But audience members who are partisan toward one candidate or the other can distort the impression that the viewer at home might, otherwise, by the way they, the audience, are reacting.

Newt Gingrich made a big stink earlier this week after NBC's Florida debate since the moderator, Brian Williams, asked the audience to hold their applause until the commercial breaks. Gingrich threatened not to participate in future debates if the audiences cannot react. Picking on one of his favorite targets, us, the news media, Gingrich said that NBC's rules stepped on free speech.

But then Gingrich feeds off the rowdy audiences. They help propel him to back-to-back knockout debate performances in South Carolina last week. Some even suggest that Gingrich was off his game Monday night because the crowd wasn't allowed to react to his zingers. Well, Newt won't have to worry about that tonight. The audience at CNN's debate will be allowed to react as long as they're respectful. However, should Gingrich go on to win his party's nomination, he's going to have to settle for debates against President Obama without the audience reaction. According to the rules set by the commission on presidential debates, those audiences must remain silent, but he's a long way from that yet.

Here's the question, should debate audiences be allowed to react? Go to CNN.com/caffertyfile, post a comment or go to our post on the SITUATION ROOM's Facebook page. Wolf, you're moderating that thing tonight. Would you rather work with an audience that reacts to what the candidate say or work with the audience being quiet?

BLITZER: Well, I think the audience tonight is going to be a big audience inside this auditorium here on the campus, the University of North Florida. We'll be, as all of the audiences have been in the other two debates that I did in Tampa and Washington, D.C, very respectful of these candidates.

Remember, one of these men might, repeat, might be the next president of the United States. So, you know, if they applaud, that's fine, I don't have any problem with that, but I just want to make sure they're respectful and treat all of these individuals, these four candidates with the dignity and respect that they deserve.

And I have no doubt that will be the situation tonight here in Jacksonville, but you know what? We'll wait and see what happens. That's part of going into live television, a debate like this. My sense is it's going to be just fine.

CAFFERTY: That will be great. Yes, looking forward to it. All right.

BLITZER: Did I answer your question?

CAFFERTY: You can run for office, Wolf. You know that?

BLITZER: Jack, thank you. You might be looking forward to it. I'm looking forward to it. I've been working on this debate now for a while. Thank you, Jack.

CAFFERTY: Sure.

BLITZER: The fiery tension between Newt Gingrich and Mitt Romney no doubt will be front and center at the debate later tonight here in Jacksonville. Newt Gingrich launching fresh attacks against his rival just a few hours ago while also having to put out some fires of his own.

Let's bring in CNN's Joe Johns. He's traveling around Florida with the former House speaker. He's joining us now. What's going on here, Joe?

JOE JOHNS, CNN CORRESPONDENT: Wolf, Newt Gingrich getting very tough today, trying something new in a state that's been hit very hard by foreclosures. He's trying to link Mitt Romney to Goldman Sachs and the mortgage crisis, and he says he's been thinking about doing this for weeks.

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JOHNS (voice-over): At a Tea Party rally in Mount Dora, an angry Newt Gingrich came out swinging at Romney's contrast campaign in Florida.

GINGRICH: The message we should give Mitt Romney is, you know, we aren't that stupid and you aren't that clever.

JOHNS: He was on the attack over Romney's Wall Street ties and unnamed lobbyist, all the while admitting Romney advertising had hurt the Gingrich campaign.

GINGRICH: You're watching ads paid for with the money taken from the people of Florida by companies like Goldman Sachs, recycled back into ads to try to stop you from having a choice in this election. That's what this is all about.

JOHNS: It's an apparent reference to employees with Wall Street heavy hitter, Goldman Sachs, who gave $369,000 in political contributions to Romney, far and away more than to any other Republican presidential candidate this cycle, according to the non- partisan, Center for Responsive Politics, which tracks the numbers.

Also, the Romney tax returns show many of his assets were managed by Goldman Sachs but kept in a blind trust. It's not illegal, but the attack is politically problematic for Romney, because the name of Goldman is tied to the subprime mortgage mess.

The Romney campaign, which is now anticipating Gingrich's salvos against their candidate, has gone so far to send high-profile Romney surrogates to Gingrich events, including Utah congressman and Romney's supporter, Jason Chaffetz. I asked him about Goldman Sachs.

REP. JASON CAFFETZ, (R) UTAH: I think Newt Gignrich is fired up, because things aren't going well here in Florida. Mitt Romney had money in a blind trust, for goodness sake, and that sounded more like an Obama speech than a Republican candidate for president.

JOHNS: Do you care if Republicans say you sound like a Democrat when you give speeches like you did today?

GINGRICH: Do I care if the Romney apparatus says whatever it says? No. I think the Washington establishment is going to fight me every step of the nomination.

JOHNS: Meanwhile, the Gingrich campaign has been forced into playing some defense, responding to conservatives who challenge him proclaiming the mantel of Ronald Reagan. Truth is, Gingrich was, sometimes, harshly critical of Reagan's foreign policy. Gingrich now is invoking the name of Reagan's wife.

GINGRICH: In 1995, at the Goldwater Institute, Nancy Reagan said that Ronald Reagan's torch had been passed to me as speaker of the House and that I was carrying out the values he believed in.

JOHNS: On another note, the former speaker also had to concede he was wrong last week when he claimed his team offered several witnesses to ABC News to refute statements made by his ex-wife, Marianne, in an interview aired last week. The only witnesses the campaign offered were Gingrich's two daughters from his first marriage who were both interviewed by the network.

(END VIDEOTAPE)

JOHNS (on-camera): It's beginning to look like an all-out assault by the Gingrich campaign here with web ads, angry words, and Gingrich seems to be stirring up his running feud with the Republican establishment, apparently, in the hopes that he'll be able to lure some of those rebellious Tea Party-types into his camp. Wolf, back to you.

BLITZER: All right. Joe, thanks very much.

All right. This just coming in to the SITUATION ROOM. New information, potentially, embarrassing information involving Mitt Romney's campaign. What is going on, Jim Acosta?

JIM ACOSTA, CNN CORRESPONDENT: Wolf, the Romney campaign is now confirming that it is reviewing discrepancies that exist between the tax returns that were disclosed earlier this week and his financial disclosure forms which were filed last August. As we know from the reporting earlier this week, those tax returns included a Swiss bank account.

Apparently, that was not previously disclosed in Mitt Romney's financial disclosure forms, which were required to run as president of the United States. And so, they are now in the process of clearing up those discrepancies.

Got a statement from Andrea Saul, spokesman with the Romney campaign just a few moments ago, and it reads, "The inescapable fact is that by releasing over 600 pages of information regarding his finances, Mitt Romney is clearly coming down on the side of disclosure. Any document with this level of complexity," she goes on to say, "in detail is bound to have a few trivial inadvertent issues"

So, they're calling it trivial. And then she adds, "We're in the process of putting together some minor technical amendments to that form." And so, they're trying to basically say these are some technical problems that existed between the financial disclosure form and the tax returns.

But as you and I were discussing just a few moments ago during that piece from Joe Johns, anytime that you're having to clear up issues with your Swiss bank account might be an image problem for your campaign.

BLITZER: Not necessarily something you want to talk about on the campaign. That Swiss bank account, that was part, correct me if I'm wrong, part of a blind trust that his economic advisers had that he supposedly had no involvement in?

ACOSTA: That is basically one of the issues with the Romney campaign that they're having to grapple with. And it may go to the reason why they did not want to have these tax returns coming out as soon as they did. They were sort of forced into producing those tax returns, but they did so under all that mounting pressure.

I will say, though, that Mitt Romney, out on the campaign trail, has repeatedly said, and I've been with him when he has said this, that, look, the tax returns aren't that important. Look to the financial disclosure forms. Those forms have much more information in them. As it turns out, they didn't have all the information.

BLITZER: So they're going to do a correction of that?

ACOSTA: That's what they say.

BLITZER: All right. Jim Acosta, thanks very much.

The Republican candidates aren't just hitting each other, they're certainly slamming the president of the United States. Coming up, the Democrats are getting ready to fire back. Debbie Wasserman Schultz, the congresswoman from Florida, the chair of the DNC, she's standing by to join us right here in Jacksonville.

And a city council candidate from (ph) Arizona won't be on the ballot, not because she can't speak to the voters, but because a judge had trouble talking to her. Stay with us. You're in the SITUATION ROOM.

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BLITZER: We're here on the campus of the University of North Florida in Jacksonville where less than three hours from now I'll be moderating the last Republican presidential debate before Florida's critical primary on Tuesday. The candidates won't only be swinging hard at each other, you can certainly be assured they will be swinging at President Obama.

Let's discuss what's going on with the chairwoman of the Democratic National Committee, the congresswoman, Debbie Wasserman Schultz. She is joining us from Florida. We're North Florida --

REP. DEBBIE WASSERMAN SCHULTZ, (D) FLORIDA: Yes.

BLITZER: You're from South Florida. A little bit different, but a lovely campus here. People are very friendly.

SCHULTZ: It is. My niece went to University of North Florida.

BLITZER: Oh, so you know this campus?

SCHULTZ: Go ospreys!

BLITZER: All right --

(LAUGHTER)

BLITZER: Let's talk a little bit about what some of the Republican candidates are saying about the man you want to see re- elected, the president of the United States. Mitt Romney reacting to the president's "State of the Union" address. I know you were there Tuesday. Listen to this.

(BEGIN VIDEO CLIP)

MITT ROMNEY, (R) PRESIDENTIAL CANDIDATE: He said he was the candidate of change, but you still have 25 million people out of work. You still have almost 10 percent unemployment here in Florida. You still have home values down and continuing to go down. You still have record number of foreclosures in Florida.

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BLITZER: A huge percentage of all of the foreclosures in the United States right here in Florida. And he's appealing to folks who are upset and nervous and concerned.

SCHULTZ: Mitt Romney has a lot of nerve talking about foreclosures when he said a few months ago that we should do nothing to help people stay in their homes and let the foreclosure crisis hit bottom, and have investors come in and scoop up the properties and turn them around to make a profit. He's proposed absolutely nothing in his entire economic plan to do anything on housing.

President Obama has been in there swinging, fighting for the middle class, has proposed in his State of the Union to make sure that we could actually push the banks to ensure that we could work out those mortgages and help people stay in their homes. Mitt Romney continues to have a lot of nerve saying one thing and living by another set of rules.

BLITZER: But what he said is mild compared to what Newt Gingrich, the other presidential front-runner, said today here in Florida out there on the campaign trail. I'll play this clip.

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NEWT GINGRICH (R), PRESIDENTIAL CANDIDATE: If you're for paychecks, you're with us. If you're for food stamps, you're with Barack Obama.

If you are for American exceptionalism, you're us. If you're for European socialism and Saul Alinsky radicalism, you're with Barack Obama.

If you are in fact in favor of a strong America in a dangerous world, you're with us. If you're for a weak America that tries to appease its enemies, you're with Obama.

(END VIDEO CLIP)

BLITZER: A weak America? That's what the president of the United States wants, one that appeases a U.S. enemy? You heard what he said.

SCHULTZ: Wow. Well, what Newt Gingrich continues to say is just one more example of just how extreme the Republicans field is. I mean, President Obama has taken us from an economy that was bleeding 750,000 jobs a month when he took office thanks to the failed Republican policies of the past. Now, after three years, we've had 22 straight months of private sector job growth.

He has focused on making sure that we can get our economy turned around, and an economy that's built to last, that will work for the middle class and working families, while folks like Newt Gingrich have insisted that we should return to the days when tax policy helped only millionaires and billionaires, and to heck with people who are already --

BLITZER: Well, he said appeasing America's enemies. So that's the -- you remember the appeasement of Neville Chamberlain and all of that in the days leading up to World War II.

SCHULTZ: Yes. Just ask Osama bin Laden whether or not they think President Obama is appeasing America's enemies. President Obama has gone after terrorists with a vengeance and actually killed or brought to justice more terrorists in his term than in all of President Bush's time in office since 9/11 combined.

BLITZER: Whoever the Republican nominee is, there will be three presidential debates in the fall against the president of the United States. So listen to what Gingrich said today. Listen to this.

(BEGIN VIDEO CLIP)

GINGRICH: I don't believe it is very likely that Governor Romney could last in a debate with Barack Obama, and I think we ought to be honest about this. We need a solid conservative who can stand there and look straight in the eye of the president and say, "Mr. President, you are wrong and your policies have failed."

(END VIDEO CLIP)

BLITZER: Who's the better debater -- who would you be more -- you're the chair of the DNC of the Democratic Party. Who are you more fearful of in a debate against President Obama? Would it be Mitt Romney or Newt Gingrich?

SCHULTZ: I'm confident that President Obama, no matter which one of the candidates he's up against, is going to be able to lay out his vision and draw the dramatic contrast that exists between anyone they nominate. And his vision, to make sure that we can continue to move this country in a direction that ensures that everyone, Wolf, in America has an opportunity to be successful. Not just millionaires and billionaire billionaires, that everyone has an opportunity to see an economy that's built to last, unlike the Republicans, who want to drag us back to the place where we were at the precipice of economic disaster, unlike Mitt Romney, who now we come to find has totally opaque financial reporting, didn't even report a Swiss bank account and other offshore accounts.

BLITZER: He's going to correct that. SCHULTZ: Well, good for him, but I filed financial disclosures for 19 years as an elected official here in Florida. I would never have assumed it was OK to leave a Swiss bank account off of my financial disclosure.

BLITZER: But it was a blind trust, if you will.

SCHULTZ: What is he trying to hide? There is a reason that that was left off. There is a reason he won't release the returns from when he was CEO of Bain Capital.

He's building his entire candidacy around his record as the CEO of Bain. We deserve to see his tax returns from when he was CEO, because he needs to come clean about his record. That's what he's holding up is his record and his predicate for his candidacy. We need to see what his fiscal choices were when he was CEO.

BLITZER: You know, we're only a couple hours away from the debate. I'm going to be moderating the debate.

What do you want to see? What are you going to be looking for?

SCHULTZ: Well, I think we'll see more extremism, more adhering to the values and strictures of the Tea Party, that they've been busy trying to out-right-wing each other. And so I don't expect much more than that.

It would be nice if we actually heard what they would do to for the middle class and working families. It would be nice if they didn't try to appeal to the base instincts of the right wing. And it would really be nice, as someone who represents a significant Hispanic population, that they would not try to really give such awful rhetoric when it comes to the immigrant community in this country.

BLITZER: The Hispanic Leadership Network in Miami, some members are going to be able to ask some questions as well.

SCHULTZ: Good, I'm glad to see that. Hold their feet to the fire.

BLITZER: All right. Thanks very much.

SCHULTZ: Thanks.

BLITZER: Debbie Wasserman Schultz is the chair of the DNC, the United States congresswoman from Florida.

I believe Hollywood, Fort Lauderdale, around that area?

SCHULTZ: All of it, yes. Absolutely.

BLITZER: Thanks very much.

We've got a lot more news coming up, including panic in Rio de Janeiro. Pedestrians fleeing the scenes of a deadly disaster, and the city asks itself how this could possibly happen. And Pat Sajak says that some episodes of "Wheel of Fortune" were tougher than others. Why? Because of what he and Vanna White did during the breaks.

Stand by.

(COMMERCIAL BREAK)

BLITZER: All right. This just coming into THE SITUATION ROOM.

The United States Senate has now followed the lead of the House of Representatives and passed legislation introduced by Congresswoman Gabby Giffords, significant legislation.

And Gabby Giffords' good friend, Debbie Wasserman Schultz, is here.

Remind our viewers, Congresswoman, what this legislation -- it passed the House of Representatives yesterday, unanimous consent right now in the Senate, meaning it just went right through, the president will sign it into law.

What does this do?

SCHULTZ: This makes sure that we can increase or interdiction on border security. Gabby has fought for border security for her entire career. Having a southern Arizona district with a border with Mexico, it's one of the biggest priorities for folks who live along the border, and she was able to pass it out of the House yesterday.

And now the Senate has passed it and sent it to the president. It's really going to be a big boost to help make sure that we can stop folks who shouldn't be trying to come into this country right at the border.

BLITZER: That was quite an emotional event you had yesterday. A lot of people, understandably so, were moved to tears.

She is now leaving Washington, she is no longer in the House of Representatives.

SCHULTZ: She's going back today, right.

BLITZER: She's actually retired.

SCHULTZ: Yes. Her letter of resignation was effective at the end of yesterday. And she's returning to Houston today to focus full time, as she has been, on her recovery.

She's made tremendous progress. I'm so proud of her.

I know her constituents -- I've heard from so many of them since yesterday. Their hearts are heavy, but they're full of hope that she's going to come back with a full recovery and represent them again one day.

BLITZER: I think I speak for all of our viewers her in the United States and around the world. We wish her a complete recovery.

SCHULTZ: We all do.

BLITZER: And good luck. Thanks very much.

SCHULTZ: I will give her everyone's best.

BLITZER: Let he know the Senate has moved to pass that legislation.

SCHULTZ: I will. I will. Woo-hoo.

BLITZER: We'll find out when the president signs it. Thank you.

SCHULTZ: It's awesome.

(COMMERCIAL BREAK)

BLITZER: Newt Gingrich certainly likes to talk about his time as the Speaker of the House of Representatives. Unfortunately for him, so do some other lawmakers, current and former.

In fact, the former U.S. senator Bob Dole said this: "Hardly anyone who served with Newt in Congress has endorsed him, and that fact speaks for itself. Gingrich had a new idea every minute and most of them were off the wall. He loved picking a fight with President Clinton because he knew this would get the attention of the press. This and a myriad of other specifics like shutting down the government helped to topple Gingrich in 1998."

Wow. Strong words from the former Republican presidential nominee.

Let's discuss with Candy Crowley, the chief political correspondent and anchor of CNN's "STATE OF THE UNION," and "TIME" magazine's managing editor, Rick Stengel.

Let me go to Candy first, Rick. You've got a great cover story as well this week.

But as far as Dole is concerned, strong words from Bob Dole, even at this point in his life. Like John McCain, another former Republican presidential nominee, Mitt Romney.

How much of an impact is this going to really have, do you think?

CANDY CROWLEY, CNN CHIEF POLITICAL CORRESPONDENT: Well, look, he's a party elder, a member of the establishment. I don't think one voice in something like this -- obviously he's a Romney supporter, but there are a lot of voices beginning to come out now.

The Romney campaign is beginning to push these people to come out, because what Romney has to do at this point is disqualify Newt Gingrich. So this is the beginning of the disqualification of Newt Gingrich, is Bob Dole's voice. And we heard a number of conservatives come out today, right, or otherwise let it be known that they thought that Newt should not be president. BLITZER: It seems to be a real campaign, Rick, to try to prevent Newt Gingrich from getting the nomination. One point that Bob Dole made was pretty fair, pretty accurate. Not a whole lot of his colleagues from his days in the House have come out and endorsed him.

RICK STENGEL, MANAGING EDITOR, "TIME": Well, I think, Wolf, one of the things that Senator Dole remembers is when he ran against Clinton in 1996, a lot of the anti-Dole ads done by Bill Clinton featured Newt Gingrich in them because Newt was so unpopular. But the question is that we don't know, there's this kind of conservative establishment striking back against Newt, but the role of surrogates indicting Newt, as it were, we have no idea whether that will be successful. And part of Newt's campaign is running against the Republican establishment, so it may backfire.

BLITZER: You think it might, Candy?

CROWLEY: Well, listen, Newt Gingrich, what has he been really good at? Turning criticism around, going, you see, they're all against me. And you know why they're against me? They're afraid because I'm really going to make change. So, absolutely, I think this is something that he's been very good at.

BLITZER: We'll see how these two guys do tonight in the debate.

Rick has got a great new "TIME" magazine cover story. I'll read the headline to you. I'll put it up on the screen. "The Power of Shyness," all about introverts, do introverts make better presidents?

All right, go ahead. "The Power of Shyness," good story, good cover on "TIME" magazine.

Jack Cafferty is coming up next. And then, the president's joke falling a little bit flat.

(COMMERCIAL BREAK)

BLITZER: Let's get right back to Jack for "The Cafferty File" -- Jack.

CAFFERTY: The question this hour is: Should debate audiences at these Republican primary debates be allowed to react to what the candidates say?

Ann writes from South Carolina, "Audience reaction allows those of us watching on television at home to sense how the candidates' comments are being received, which can be helpful. It's like reading letters to the editor or comments on this blog, allowing us the opportunity to learn from other people's opinions as long as we eventually use the information to form our own opinions."

"Also, let's face it. The CNN debate in South Carolina was a lot more fun to watch than NBC's debate."

Tim writes, "I don't have a problem with applause, but when they start screaming and booing like it's a football game, I think that's over the top."

Cary writes, "Having this many debates reduces it to a sideshow. Considering the crop of candidates, maybe freak show is closer to the mark."

"The first step of legitimizing debates would be to reduce the number. The second would be, discourage audience reactions. By doing things the way they have, it's turned the presidential race into a reality show. All they need now is Simon Cowell, rename the whole thing 'America's Got Political Talent.' Instead of a record deal, you win four years as president."

Randi writes, "Yes, with rotten tomatoes."

Doug writes, "The debates are not about the crowds. There shouldn't even be a studio audience present."

And Dennis in Florida writes, "This question seems insane. Why have an audience if it can't react? Why do you think they have live audiences for sit-coms? So that real people can laugh at the clowns. Is a political debate any different?"

If you want to read more about this, you can go to my blog, CNN.com/caffertyfile, or through our post on THE SITUATION ROOM'S Facebook page.

And the crowd will be allowed to react at tonight's CNN debate in Florida moderated by my buddy, the Wolf man -- Wolf.

BLITZER: Thank you very much, Jack. We're only a couple of hours away. They will be respectful, though, I am sure.

The State of the Union Address brought out some groans and sparked some debate. Stand by.

(COMMERCIAL BREAK)

BLITZER: One of President Obama's State of the Union laugh lines didn't exactly generate a whole lot of laughs.

Let's bring back CNN's Lisa Sylvester to explain what's going on -- Lisa.

SYLVESTER: Well, Wolf, President Obama made a joke at the State of the Union. And it did, it kind of fell flat. One reason why it might be, that many people probably weren't familiar with the issue the president was talking about. It's a fight between environmentalists who wanted to keep a tough regulation in place and an industry that wanted to be exempted from what it called a burdensome rule.

(BEGIN VIDEOTAPE)

SYLVESTER (voice-over): Some moments in a presidential State of the Union Address are a hit. Some moments, a miss.

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: We got rid of one rule from 40 years ago that could have forced some dairy farmers to spend $10,000 a year proving that they could contain a spill because milk was somehow classified as an oil. With a rule like that, I guess it was worth crying over spilled milk.

SYLVESTER: Cameras caught Representative Jason Chaffetz summing it up with a missed rim shot. But the president's "spilled milk" joke didn't just prompt some groans, it also is spurring some grief among environmentalists. As the online magazine "Gawker" first pointed out, spilled milk can be a serious issue.

Weston, Massachusetts, in 2007, it was a milky mess on the highway. San Jose, California, in 2000, a milk truck overturned, spewing 6,000 gallons of milk.

If spilled milk gets in the lakes, streams and rivers, it can turn into an environmental headache.

MARC YAGGI, WATERKEEPER ALLIANCE: If there's a discharge of milk into a waterway, the bacteria that live there are going to try to eat the milk. And during that process of breaking the milk down, it's going to take out all of the oxygen out of the waterway. The fish can't survive.

SYLVESTER: Under a regulation called the Spill Prevention Control and Countermeasure, milk spills were treated the same as oil spills. That's because milk contains a percentage of animal fat which is a non-petroleum oil as spelled out by the federal government. But the tough rules applied even to ice cream and cheeses.

The International Dairy Foods Association lobbied hard to get the regulation lifted, and they were successful. The EPA last year exempted dairy from the oil spill rule. In a statement, the EPA said it " -- placed unjustifiable burdens on dairy farmers."

President Obama has now tasked his administration with taking a fresh look at other regulations.

OBAMA: I've ordered every federal agency to eliminate rules that don't make sense. We've already announced over 500 reforms, and just a fraction of them will save business and citizens more than $10 billion over the next five years.

SYLVESTER: Dairy companies are applauding the rule change that would keep them from being fined over spilled milk.

(END VIDEOTAPE)

SYLVESTER: Now, environmentalists are really concerned about the bigger picture here, the Obama administration possibly rolling back other regulations. But in the case of the spilled milk, the dairy industry says that it will actually save the industry about $133 million a year in compliance costs -- Wolf.

BLITZER: Lisa Sylvester, thanks very much for that.

I'll be back in two hours to moderate the Republican presidential debate here in Jacksonville, Florida.

Until then, thanks very much for watching.

I'm Wolf Blitzer in THE SITUATION ROOM.

The news continues next on CNN.