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The Situation Room

Millions Without Power After Killer Storm; New Peace Plan for Syria?; Interview with Debbie Wasserman Schultz

Aired July 02, 2012 - 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: You're in the SITUATION ROOM. Happening now, millions and millions of Americans stuck in record heat without power after a ferocious killer storm hammers an area stretching hundreds of miles. We're going to show you just how it got -- it's getting in a house when there's no electricity going on. Standby.

And as massive wildfires rage out west, people are returning to their homes that simply no longer exist. We brought you the heart wrenching story of a grandmother caring for her orphan grandchildren. You're not going to see what happens when they face the ruins for the first time.

And has the U.S. Supreme Court sprung a leak? We're looking at a new report that the chief justice, John Roberts, perhaps, changed his mind in siding with liberals on the healthcare vote.

We want to welcome our viewers in the United States and around the world. I'm Wolf Blitzer. You're in the SITUATION ROOM.

(BEGIN VIDEO CLIP)

(END VIDEO CLIP)

BLITZER: Much of the Eastern United States is in a state of emergency today as residents face a massive cleanup from a rare and terrifying storm. It struck Friday night late. A wall of fury hundreds of miles wide with wind gusts topping 80 miles an hour. A massive thunderstorm complex with tornado-like power.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: It sounded like a freight train. I mean, it was just loud and it was dark and the hail was coming, and I just heard it go -- and bam, and it comes down.

(END VIDEO CLIP)

BLITZER: Take a look at this composite radar image. It shows how the storm raced out of the Midwest in a wide, straight line. It traveled 600 miles, reaching the east coast of the United States within hours. Impacted incredible ferocity and the impact is still unfolding. At least 19 people were killed. Twenty-six-year-old Kip Nuan (ph) died Friday night in Springfield, Virginia. That's right outside Washington, D.C. He told his wife he was heading home. He was heading home just before the storm struck. When he didn't show up, though, she went out to look for him.

(BEGIN VIDEO CLIP)

TUYATMAI DIH, HUSBAND DIED IN STORM: He just called me, and then, he said he's going to be home in ten minutes. And then I'm waiting for him to get home. Twenty minutes pass by and I haven't seen him. The detective came over and told me that my husband passed away because the tree fell on top of the car.

(END VIDEO CLIP)

BLITZER: Today, millions of people are still without power from the Midwest to the Midatlantic. And while the triple digit heat that spawn the storm as east, that still means temperatures in the 90s for the eastern two-thirds of the United States. Eighteen states right now are under heat advisories. Our own Brian Todd has been checking the impact here in the Washington, D.C. area. Brian, first of all, tell our viewers where you are and what you're seeing?

BRIAN TODD, CNN CORRESPONDENT: Wolf, we're in Arlington, Virginia. This is a street in South Arlington, real devastation in these areas. Take a look at this. A tree came down on this power line right here, took it out. A tree then fell on that car and completely crushed that vehicle right there. Now, when the tree took out this power line, it disabled that pole.

Then, a complete domino effect. That pole was disabled. That pole in the line pulled down. This pole right here and then a domino effect down a ravine over here. We're told 12 power poles are out, power poles are out on the street. We're told this neighborhood may not get power back until tomorrow night at the earliest. And this is a fairly typical scene throughout the entire region.

(BEGIN VIDEOTAPE)

TODD (voice-over): Phi Ley and his family just returned from a weeks vacation in Mexico to a house that's almost unlivable.

PHI LEY, RESIDENT WITHOUT POWER: It's still a little bit cold but probably going to go bad.

TODD: His power has been out for two and a half days in sweltering heat. He tries to save food from his freezer to take to his brother-in-law's louse.

How uncomfortable is it right now?

LEY: It's very uncomfortable, because we're not used to the heat and humidity. I guess, we're used to the air-conditioning being on during this condition.

TODD: And you're concern with her well-being. She's only eight years old.

LEY: Yes. It's really hot for her. So, you know, we're just here to pick up some clothes and, you know, toiletries and stuff spend the night over at the in-laws.

TODD: For good reason, Ley's house in Arlington, Virginia is typical in a region where, for many, it can be unhealthy to stay home in this heat in wake of violent thunderstorms.

So, what does the average house have to (INAUDIBLE) with as far as temperatures, when the power is out for a long time? We're in the basement of Ley's house. We're going to show you temperatures at each level. In the basement here, we've got this infrared thermometer blasted against the wall.

Temperature reading is 75 degrees. Now, let's head to the middle level. Now, we're in the middle level of their house. Let's read the wall, 83 degrees. Now, let's try the third floor, the uppermost floor of the house, blast the wall, 91 degrees. That why they tell you to go the lowest level of the house in a power outage. (INAUDIBLE) library, (INAUDIBLE).

UNIDENTIFIED FEMALE: I've lived through it before. I can do it again.

TODD: From the Midwest to the mid-Atlantic, hundreds of thousands are without power, maybe more. Temperatures are spiking to record levels. And people in more than a dozen states are being warned not to test their heat endurance. Power company crews are getting help from as far away as Canada, but they're still overextended. The Ley's street, one of the hardest hit.

(on-camera) In this neighborhood, it was a complete domino- effect. A tree took down that power line right there, disabled that pole, then disabled the pole in the foreground. That, of course, knocked out this one over here. And we're going to talk to Josh Little from Dominion Virginia Power. He's a crew supervisor.

Josh, this obviously disabled this pole and one down there. How long does it take you to get a neighborhood like this back up to power?

JOSH LITTLE, DOMINION VIRGINIA POWER: Usually, it will take me about two days with the manpower I have. Reason being because I can't use any modern equipment in here. It's all to be set by hand. So, at least two days in here.

TODD (voice-over): An eternity for families just trying to escape the heat.

Does it make you think twice about staying in this area?

LEY: No, because this is (INAUDIBLE). I mean, this is nature. It happens, you know?

(END VIDEOTAPE) TODD (on-camera): So, as residents try to cope with all this, the power crews have their own obstacles to overcome. We're told by power company officials that it's too dangerous basically for them to work at night. They can't get up in work in transformers or some of the lines that are down very hard to see.

They just can't do it at night, too dangerous. So, we're told by state officials here and elsewhere that the last person or a customer to get power back in this general (INAUDIBLE) may not get it back, may not receive it until (INAUDIBLE) Friday night -- Wolf.

BLITZER: Brian, I understand that in the early hours right after the storm, some of these dangers were actually made worse by problems with the emergency response systems. What happened?

TODD: That's right. County officials in Fairfax and Prince William Counties in Northern Virginia have told us that the 911 emergency response systems, those numbers and the lines were down. They had to get the word out by Facebook, Twitter, radio, and TV to give people alternate numbers to call if you have an emergency and needed to dial 911.

Now, we're told that most, if not all the systems are back up. But they're investigating what happened there. That, obviously, was not the best time for that to happen. That was in the immediate hours after the storm.

BLITZER: Brian, thanks very much. Brian Todd on the scene for us as he always is. Let's get a little closer look at this extraordinary storm from our meteorologist, Alexandra Steele. She's over at the CNN severe Weather Center.

ALEXANDRA STEELE, AMS METEOROLOGIST: Hey, Wolf. Well you know what, it's called a derecho. And it is deadly and it is dangerous. But believe it or not, in the Midwest and the Great Lakes, it's not really uncommon in the summer to have one. Now, in Washington, D.C. on the other hand, it is a little more uncommon. It happens about once every four years.

So, let me show you what it looks like. Here's Chicago, and there it is. It's kind of like a lawnmower just mowing everything down into path. It began in Iowa, moved through Illinois, Indiana, Ohio, and moved into Washington, D.C. It's just a fast moving, long- lasting violent thunderstorm complex, in essence, acts a lot like a tornado, but a tornado is quick lived.

This certainly is not. So, you can see what it did to Washington, D.C. And you can see how severe it was. All right. So, it covered 650 miles. So, just an incredibly long path. Now, the wind reports have been incredible, and of course, with 50 miles wide at one point, you only can imagine. Ninety-one miles per hour wind gusts in Ft. Wayne, Indiana. 80-mile-per-hour wind gusts reported in Ohio.

And in Washington, D.C. where so much damage and destruction was. Seventy-one miles per hour winds were reported. So, certainly it has a lot of energy, and it's incredibly robust. So, how this happen, right? And why did it happen? Well, the ingredients are there. You need a few things for a derecho to occur.

And here's a look at see (ph). All right. Hot air, boy we had that, right? Check. Record breaking heat around the country. A 100- degree temperatures. Also, we need a front. We had that. Also, what we need, very strong winds, low level winds, and we certainly have that as well. So, all the ingredients came together.

So in essence, really, it's a fierce powerful, long lasting wind storm that kind of just moves and crushes everything in its path. It's very difficult to predict, though. That's the one little caveat with a derecho, but we had all the ingredients then. It leaves behind hurricane-like damage, which we certainly have seen -- Wolf.

BLITZER: Alexandra Steele reporting for us, thank you.

Now to the fire scorching much of the Western United States. Hundreds of thousands of acres are burning across six states, including South Dakota, where a large fire fighting plane has crashed. (INAUDIBLE) there were casualties. This is the second air tanker to crash recently, prompting the U.S. military to ground that type of special fire fighting plane which is bad news because these planes can discharge 3,000 gallons of water in less than five seconds.

A glimmer of hope, meanwhile, in Colorado. Officials say they've stopped the massive Waldo Canyon fire from growing any bigger. And, they're now focusing in on small remaining fires within the 18,000 acres already burned. The worst fire in state history. Only 55 percent contained as of now. The U.S. Forest Service says it could be two more weeks before it's fully under control.

Bittersweet news for many of the 32,000 people who evacuated from the fire. They're being told they can now return home, but for hundreds of these people, their worst fears are coming true. There's no home left standing. CNNs Jim Spellman is joining us now. He's been following one family's hart wrenching story of survival -- Jim.

JIM SPELLMAN, CNN CORRESPONDENT: Yes. Hey, Wolf. Even as the firefighters make progress in their battle against the fire, for people who lost everything, their battles are just beginning. Take a look.

(BEGIN VIDEOTAPE)

VOICE OF SUSAN SOLICH, FIRE VICTIM: Here we are in the driveway. Oh my gosh. Oh my good goodness. Wow.

SPELLMAN (voice-over): Susan Solich knew the wildfire destroyed her home, but seeing it up close was devastating.

SUSAN SOLICH: There it is. My home. Eighteen years.

SPELLMAN: Though, her neighborhood is still evacuated, she was allowed to visit what's left of her home for a few hours. She brought along a camera to record the experience for CNN. SUSAN SOLICH: There's my neighbor's home. Intact. My other neighbor's home intact. Every home around me intact. Oh, my god. This is unreal.

SPELLMAN: We first met Susan last week after her daughter and son-in-law died, she was left to raise these four grandsons as well as her 16-year-old daughter, Hanna. Now, their home is gone.

HANNAH SOLICH, FIRE VICTIM: I was born and raised there. I mean, I made all the childhood friends in that neighborhood. And it's where I've grown up my whole life. So, it's very hard to see it like that.

SPELLMAN: Susan's story has impacted people around the country, with hundreds coming forward to offer them help to start over. She knows rebuilding will be difficult for the boys.

When you realized that the home was destroyed and you'll be starting over again in another new house. How did that feel?

TYLER FLOWERS, FIRE VICTIM: I don't know. It kind of felt scared. We're probably going to have a hard time with getting used to it. Like, we were used to our old house, but it has been burned to the ground.

SPELLMAN: She isn't sure if she'll rebuild in her old neighborhood.

SUSAN SOLICH: How do you live up there? It'd be like living in a twilight zone episode.

SPELLMAN: With so little to go back to, she'll search the remains of what's left of her home for anything to her old life.

SUSAN SOLICH: We're going to try and come back in the next couple days and sift through and see if we can find anything.

SPELLMAN: And take stock of what matters most.

SUSAN SOLICH: To see it and to walk down in it, we walked down in it and kind of sifted through a few things, and, yes, it was closure. It was painful. But, it was also a blessing to realize that we're OK. And we will be OK.

(END VIDEOTAPE)

SPELLMAN (on-camera): Wolf, the residents here don't even know when they'll be able to get into these devastated areas to really start rebuilding. It could be weeks or even months before they can really start putting their lives back together.

BLITZER: We wish them only the best under these awful, awful circumstances. Jim Spellman, thanks for that report.

And to our viewers out there, you can help the victims of these fires. To get more information, go to CNN.com/Impact. New alleged e-mails in the case against Jerry Sandusky. They might show Penn State officials, the highest ranking officials, new very disturbing details about Sandusky with a young boy, but they chose to cover it all up. Standby.

And the swimmer, Michael Phelps, won't be breaking his own medal record this summer. Why he's dropping out of an event that he won the gold in four years ago?

And as the violence rages on in Syria, a new peace plan emerges, but not so fast. Why the secretary of state, Hillary Clinton, says it might not work?

(COMMERCIAL BREAK)

BLITZER: More potential trouble for Penn State University in the case against the former football coach, Jerry Sandusky. CNN has obtained exclusive information about e-mails that may show high ranking school officials knew about an incident involving Sandusky and a young boy in a shower and chose to turn a blind eye.

Our national correspondent, Susan Candiotti, obtained this information from a source who has direct knowledge about the case. Susan is joining us right now. Susan, tell our viewers what these e- mails show?

SUSAN CANDIOTTI, CNN NATIONAL CORRESPONDENT: Well, there are two key points here, Wolf. First of all, the alleged e-mails indicate Penn State officials had a plan to contact child welfare officials as they're required to, to report that 2001 shower incident, and investigate a possible case of child abuse, but they changed their mind. And the exchanges also suggest Coach Joe Paterno might have played a role in that decision.

(BEGIN VIDEOTAPE)

CANDIOTTI (voice-over): CNN has been given details of four purported e-mail exchanges from sources with knowledge of the case, raising new questions about what Penn State knew and when they knew it.

The e-mails are between Penn State president, Graham Spanier, vice president, Gary Schultz, and athletic director, Tim Curley, discussing the now infamous 2001 shower incident where assistant (ph), Mike McQueary, said he saw Sandusky sexually assaulting a young boy.

The first e-mail is dated February 26th, 2001. That's 16 days after McQueary reports to his boss, Coach Joe Paterno, about what he's seen in the shower. Paterno testified, quote, "It was a sexual nature." By now, McQueary testified. He's told Athletic Director Curley and VP Schultz about exactly what he saw, a boy with his hands up against a wall with Sandusky behind him.

The alleged e-mails don't mention Sandusky by name, instead calling him the subject and person. In the first exchange, Schultz messages Curley about a three-part plan to, quote, "talk with the subject, contacting the charitable organization, Second Mile, and contacting the Department of Welfare." That's an agency required by law to investigate suspected abuse.

Yet, the next night, Curley indicates a change of heart. He allegedly sends an e-mail to Penn State's president Spanier and refers to a discussion they had two days earlier about Sandusky. Curley says he wants to talk things over with Sandusky and work with him before deciding whether to contact child welfare.

He also refers to Coach Paterno. Did something he said change Curley's mind? Quote, "After giving it more thought and talking it over with Joe yesterday, I am uncomfortable with what we agreed were the next steps. I am having trouble with going to everyone but the person involved. I would be more comfortable meeting with the person and tell them about the information we received. And tell them we are aware of the first situation."

The first situation he's referring to is a separate shower incident Sandusky had with a boy in 1998. Sandusky was not charged at the time. He was convicted of both incidents at trial. Curley plans to tell Sandusky, quote, "We feel there is a problem and offer professional help." And at some point soon inform his organization, Sandusky's Second Mile, and quote, "maybe the other one."

According to a source with knowledge of the e-mails, he's referring to child welfare. If Sandusky is, quote, "cooperative," Curley writes, quote, "we would work with him. If not, we do not have a choice and will inform the two groups." Two hours later, Penn State's president purportedly responds and agrees with the approach.

Quote, "I am supportive," Spanier writes, and adds this, "the only downside for us is if the message isn't heard and acted upon, and we then become vulnerable for not having reported it, but that can be assessed down the road." Spanier calls the plan humane and a reasonable way to proceed.

The next day, VP Schultz weighs in with an alleged e-mail to president Spanier and athletic director Curley, quote, "This is a more humane and up front way to handle this," he writes. "We will inform his organization with or without his cooperation. We can play by ear to decide about the other organization."

Another reference a source says to outside authorities, but that never happened. Authorities say records show suspicions about Sandusky in 2001 were never reported to any outside agency. Victim five was molested by Sandusky in a Penn State shower about six months after the McQueary incident. And Sandusky later went on to sexually abuse at least three other boys.

(on-camera) Years later, all testified at trial. Curley and Schultz are already charged with perjury and failure to report suspected child abuse. They pleaded not guilty. Sources say Spanier could also be charged. Spanier's lawyer did not return repeated calls for comment.

Lawyers for Curley and Schultz provided this statement to CNN, quote, "As Pennsylvania governor, Tom Corbett, stated, if we were going to do this case, we had to have the best possible case to go against somebody like Mr. Sandusky who is loved by everybody," end quote.

Lawyers add, "For Curley, Schultz, Spanier and Paterno, the responsible and humane thing to do was like Governor Corbett, to carefully and responsibly assess the best way to handle vague but troubling allegations. Faced with tough situations, good people try to do their best to make the right decisions."

A spokesman for Joe Paterno's family says Paterno did the right thing. He reported to his boss what McQueary told him. The spokesman said, quote, "everyone should want the truth, and Joe always told the truth."

(END VIDEOTAPE)

CANDIOTTI: Now, Wolf, a source with knowledge of the investigation also says that billing records between the university and an outside council that they were using at about the time of the 2001 incident also are being examined, and these documents show according to a source with knowledge of the free investigation, that the university was researching their legal obligation to report the 2001 incident -- Wolf.

BLITZER: Thanks so much for that report. Susan Candiotti with exclusive reporting for all of us. Appreciate it very much.

Coming up, a new peace plan for Syria raising, though, new doubts what it really help ease President Bashar al-Assad out of power. The secretary of state, Hillary Clinton, is speaking exclusively to CNN. Standby.

And the Supreme Court apparently springs a leak, apparently, keyword. New word that the Chief Justice John Roberts, perhaps, changed his mind before the healthcare ruling. What's going on? Our own Jeff Toobin is standing by.

(COMMERCIAL BREAK)

BLITZER: As the violence rages on in Syria, the opposition leaders have been meeting in Egypt. They're trying to find some common ground in their fight against the regime of the president, Bashar al-Assad. At issue, a new international peace plan which caused for a so-called transitional government as a step toward ending the bloodshed.

But the secretary of state, Hillary Clinton, concedes that the plan backed by both Russia and China, as well as some others in the west, might not necessarily work. She spoke with our foreign affairs correspondent, Jill Dougherty.

(BEGIN VIDEOTAPE)

JILL DOUGHERTY, CNN FOREIGN AFFAIRS CORRESPONDENT: Let's begin with that critical point that you talked about so many times that Assad has to step down, leave. Now, it appears that the Russians want that point. There is no direct demand that Assad go.

HILLARY CLINTON, SECRETARY OF STATE: Well, Jill, I couldn't disagree with you more. I think that what the agreement clearly states is that there has to be a transitional governing body that will be constituted of people who are there by the mutual consent of the government and the opposition.

Now, unless, I am wildly off base, there is no way anyone in the opposition would consent to Assad or his inside regime, cronies, with blood on their hands, being on any transitional governing body.

DOUGHERTY: Do you really believe that the Russians can convince Assad?

CLINTON: Jill, I think that's a great question, because one of the points that became clear, both in my long conversations with Foreign Minister Sergey Lavrov last night in St. Petersburg and then in our larger group today, they have committed to trying. But they've also admitted that, you know, they may or may not have enough leverage to convince, not just one man, but a family and a regime that their time is over.

DOUGHERTY: There are some people who say that the Russians want to play this out. That they look at the election schedule in the United States November, there's an election. They realize that there's little appetite either in Washington or practically any other capitol for military action, and so they're just playing it out.

CLINTON: I think they have begun to realize they are riding two horses at the same time, so to speak. They're realizing we don't have any love lost for Assad. We don't have a stake in him staying. But we're afraid of the violence and what will come after. So, the argument I have made to them consistently is that their failure to be part of the solution is the surest way to ensure we have a civil war with sectarian conflict that spills over the borders.

(END VIDEOTAPE)

BLITZER: And Jill Dougherty is joining us now.

So, Jill, bottom line right now, is the so-called plan doomed?

DOUGHERTY: You know Wolf, if you listen to Secretary Clinton; it doesn't sound good, does it? And one of the problems is this lack of definition as to whether or not Assad has to go.

Now, today at the briefing here at the state department, Victoria Nuland, the spokesperson said that they will have -- the opposition will have an ironclad guarantee they will have a veto on whether or not Assad is part of the transitional government, if that transitional government.

And obviously, they don't want him. But this transitional governing body doesn't exist right now. So there's a big question. Can it even come into being? BLITZER: One other unrelated question as far as this is concerned. I know you spoke with the secretary of state about the so- called blind sheikh who was convicted of terrorism charges in the connection of the 1993 bombing of the world trade center. The new president of Egypt, Mohamed Morsi, says he wants the United States to release him, let him go back to Egypt. I take it the secretary of state is saying no way.

DOUGHERTY: Yes, no way. She's saying that he was convicted, that the charges were correct. That he is now in prison, and she's saying nothing is going to change. And that is the position of the United States right now.

BLITZER: Jill Dougherty, off traveling with the secretary of state and doing the interview for us. Thank you very much.

So how are Americans thinking of the health care reform plan now? You've heard from the politicians. You're going to want to see what our brand new CNN/ORC poll shows after the controversial Supreme Court ruling.

And the court upheld the mandate calling it essentially a tax. Why are Democrats desperately trying to avoid that word? I'll ask the Democratic National Committee chairwoman. Debbie Wasserman-Schultz, she is standing by.

(COMMERCIAL BREAK)

BLITZER: We've heard plenty from the politicians about the Supreme Court's ruling on Obamacare. But now you don't want to hear with some fellow Americans think about it.

Let's bring in Dana Bash who has been looking at the story. You are also looking at this new survey.

DANA BASH, CNN SENIOR CONGRESSIONAL CORRESPONDENT: That's right. And Wolf, it shows Americans are largely divided among party lines. It's probably no surprise. Republicans say that they are very much opposed to this decision. The Democrats say they're for it. But I took a closer look at a sector of the electorate that really matters, very much matters, and both sides are trying to score points with that.

(BEGIN VIDEOTAPE)

BASH (voice-over): The Republican rhetoric is red hot.

MITT ROMNEY (R), PRESIDENTIAL CANDIDATE: I will act to repeal Obama care.

REP. JOHN BOEHNER (R-OH), SPEAKER OF THE HOUSE: This has to be ripped out by its roots. This is government taking over the entire health insurance industry.

BASH: A new CNN/ORC poll reveals which voters Republicans are trying to appeal to, a small but critical group of independents. Check out this number. Fifty five percent of independent voters oppose the crux of the law, the government mandate for health insurance, a small majority, but enough to make the difference in a neck and neck race.

Then there's the issue handed to Republicans by chief justice John Roberts, who likened the individual mandate to a tax.

REP. PAUL RYAN (R-W), BUDGET COMMITTEE CHAIRMAN: If this was brought to the public as a tax, there's no way it would have passed into law in the first place.

BASH: The new poll shows 59 percent of independent voters believe the health insurance mandate is a tax. Republicans are on an all-out offensive to tell Americans that could hit them.

RUBIO: It is a massive tax increase on the middle class.

BASH: The Democratic strategy, not surprisingly, is to remind voters about widely popular parts of the law, like protecting people with pre-existing conditions. The committee charge with electing House Democrats just lost robo calls against ten house Republicans with more to come.

UNIDENTIFIED FEMALE: Congresswoman wants to put insurance companies back in charge of our health care and let them deny coverage to people with pre-existing conditions, like asthma, heart disease and cancer.

BASH: Still GOP sources try to re-take the majority in the senate admits to CNN, their laws of the Supreme Court, is a big win politically.

SEN. MITCH MCCONNELL (R-KY), MINORITY LEADER: If I'm the leader of the majority, next year I commit to the American people that the repeal of Obama care will be job one.

BASH: Republicans are promising to use Senate rules to overturn major parts of the law with a simple majority, if they win the Senate.

(END VIDEOTAPE)

BASH: Now from the White House to Capitol Hill, Democrats argued Republicans are fighting yesterday's battles instead of focusing on today's problem that is getting Americans jobs. But one top Republican source told me that GOP leaders believe the Supreme Court decision upholding health care is a quote, "seismic event" in they're favor. So much so, Wolf, that the source revealed to me that the big wave here in Washington have told Republican senate candidates every day you're not talking about health care is a day you've wasted.

BLITZER: All right. Dana, thanks very much. Good report.

And at least to our next guest, in addition to people's confusion about buying health insurance under the president's plans, our latest polling also reveals a significant Mitt Romney lead in the so-called battleground states, about 15 battleground states that will certainly decide the presidential election in November.

Let's talk things over with the chair of the Democratic Party, Congresswoman Debbie Wasserman Schultz. She's joining us from her district in Florida. Congresswoman, thanks very much for coming in. And we specifically went to those 15 battleground states that either leaning one way or another, but they're certainly not made up their minds.

Look at this. Among registered voters in those states, 51 percent now say they support Romney; 43 percent say they support Obama. I assume that's deep concern for you.

REP. DEBBIE WASSERMAN SCHULTZ (D), FLA.: Well, actually, if you look at the nationwide numbers in your poll, it is the 12th out of 13 polls in the RealClearPolitics average of polls that have President Obama up over Mitt Romney.

And in fact, the NBC poll done over that same period of time in 12 battleground states has President Obama up by 8 points over Mitt Romney. So I'm not sure if your poll is an outlier or if it's just that we can chalk up that where about 127 days from the election and we're focused on making sure that Americans understand that there are two visions and two paths laid out before them.

And the direction that they could go is dramatically different. President Obama will continue to fight to create jobs, turn the economy around and Mitt Romney and his allies in the Republican Party will try to drag us back to the failed policies of the past and, amazingly, focus on denying people health coverage and making sure that instead of getting the economy turned around, that we can focus on making sure that people who can't get healthy. It's kind of shocking.

BLITZER: (Inaudible). But you're right on the national numbers among registered voters nationwide, the president still have this lead, slightly, 49 percent; 46 percent for Romney. That's the same as it was in May. This is the first poll that was completely done since the Supreme Court decision upholding the president's health care reform law.

So it doesn't look like that's had an enormous difference. The battleground states, those are the numbers you're seeing now, though, 15 battleground states show Romney with a significant lead, 51-43 percent.

But we'll see other polls. We'll see if, in fact, those are outlier numbers or if they are consistent with other mainstream polls that will be coming out, no doubt, in the next several days and weeks.

Let's to the Supreme Court decision. The president, as you know, when he was running for office, he promised he would not raise taxes on the middle class. I'll play a clip of what he often said during his race for the White House.

(BEGIN VIDEO CLIP) BARACK OBAMA, PRESIDENT OF THE UNITED STATES: That's why I believe that every single American has the right to affordable, accessible health care.

(APPLAUSE)

OBAMA: A right that should never be subject to Washington politics or industry profiteering, and that should never be purchased with tax increases on middle class families, because that is the last thing we need in an economy like this. Folks are already having a tough enough time.

(APPLAUSE)

(END VIDEO CLIP)

BLITZER: All right. So here's the question, in the Supreme Court decision, they decided that the penalty, as it's called, was, in fact, a tax increase and most of the people who would pay that penalty, that tax increase, would be from the middle class. They wouldn't be making more than $200,000 a year, $250,000 a year. A lot of them are making a lot less.

So is this a violation of the president's commitment not to raise taxes on the middle class?

SCHULTZ: Well, what we do know is that both Mitt Romney and President Obama agree that the penalty in the Affordable Care Act for deciding to be a free rider, deciding to be irresponsible and not carry health insurance coverage, which costs every American more in their overall health care costs, that that is a penalty and not a tax.

In fact, Mr. Romney's spokesperson, Eric Fehrnstrom this morning specifically said that he agreed with President Obama, this is a penalty. What would happen is that you have a lot of folks -- it's about 1 percent of Americans that choose deliberately to be irresponsible and cost us all more money by using the emergency room as their primary access point for health care.

They roll the dice and when they show up to the emergency room, we all pay for their health care costs. That's why tongue depressors are $50 and hospital paper gowns are 85 bucks. And so what the penalty says is that, you know, we're not all going to pay for your being irresponsible.

BLITZER: All right.

SCHULTZ: And that, President Obama and Mitt Romney both agree on that. It -- the overwhelming majority of Americans are covered on health insurance. This would affect a very small percentage of free riders, who we shouldn't have to pay for.

BLITZER: Eric Fehrnstrom and you and some others may say it's just a penalty, that it's not a tax. But during the arguments before the Supreme Court, the president's own lawyer, the solicitor general, Donald Verrilli, he acknowledged point-blank in response to questions from John Roberts, the chief justice, that it was, in fact, a tax. Listen to this exchange they had.

(BEGIN VIDEO CLIP)

JOHN ROBERTS, SUPREME COURT CHIEF JUSTICE: Are you telling me they thought of it as a tax, they defended it on a tax power? Why didn't they say it was a tax?

DONALD VERRILLI, U.S. SOLICITOR GENERAL: They might have thought, Your Honor, that calling it a penalty as they did would make it more effective in accomplishing its objectives. But it is in the Internal Revenue code. It is collected by the IRS on April 15th. I don't think this is a situation in which you can say --

ROBERTS: Well, that's the reason. They thought it might be more effective if they called it a penalty.

(END VIDEO CLIP)

BLITZER: The solicitor general tells the Supreme Court representative the Obama administration, it is, in fact, a tax; it'll be administered by the IRS. It'll be collected on April 15th. Why can't you acknowledge that it's -- that it is, in fact, a tax?

SCHULTZ: Because it's a penalty. It's not a tax. It's a penalty that if you decide to be irresponsible, and continue to refuse to carry health insurance and make us all pay for your being irresponsible, then you can do that.

You know, we're not going to require that you have health insurance. What we're saying is if you choose not to carry health insurance, then you will be assessed a penalty that will be assessed on your tax return. And that affects about 1 percent of Americans who choose to do that.

BLITZER: So Donald Verrilli, Donald Verrilli, the solicitor general, was wrong? He didn't tell the truth to the Supreme Court?

SCHULTZ: No, on the contrary. What -- the way we usually think of taxation, Wolf, is that taxation, as the IRS administers it, is collected on broad swaths and large categories of individuals. This is a penalty that will be assessed on a tax return if you choose to roll the dice and make us all pay for your being irresponsible and increase all of our health care costs.

We're not going to tolerate that any more in America. You have to be responsible and you're going to pay a penalty if you choose not to be.

BLITZER: I have one final question. Why is the IRS administering this if it's not a tax? Isn't that their job, to impose taxes, to collect taxes, to punish people who don't pay taxes?

SCHULTZ: Well, because administratively, that's the -- that's really the easiest, most basic way to do it. It's the same way that they do it in Massachusetts. The Department of Revenue in Massachusetts, under RomneyCare, collects actually an even more significant, greater penalty.

This is modeled after the same way that the health care reform law championed by Mitt Romney in Massachusetts was handled. They have a penalty in Massachusetts under RomneyCare. It's administered by the Department of Revenue. It's simply a matter of ease in administration.

And, you know, at the end of the day, Wolf, what's important -- and I can tell you speaking as a breast cancer survivor, as someone who lives with a preexisting condition, this health care reform law is about people, not about politics.

The Republicans are obsessed with making sure that they can beat Barack Obama and deliver him a defeat at any turn. And rather than focus on job creation for the 129 million Americans who live with a preexisting condition, we find that outrageous.

Making sure insurance companies can't drop us or deny us coverage is now a thing of the past. And I hope the Republicans will stop opposing it and get on board and make sure we can get moved towards full implementation.

BLITZER: I'm going to have more on this --

SCHULTZ: It's the right thing to do.

BLITZER: -- I'm going to have more on this subject coming up at the top of the hour in our new 6:00 pm Eastern hour of THE SITUATION ROOM. I want you to watch it later, Congresswoman, if you have a chance, and we'll continue this conversation (inaudible) down the road. Appreciate it very much.

All over the word, athletes are ready for the Olympics. But something just happens we almost never see, despite all the timing technology, one race ended in a tie. So what happens next? It could surprise you.

And scientists just figured out why some tomatoes taste better than other tomatoes.

(COMMERCIAL BREAK)

BLITZER: The American Michael Phelps drops out of an Olympic event.

Lisa Sylvester is monitoring that and some of the other top stories in the SITUATION ROOM right now.

Lisa, what's going on?

LISA SYLVESTER, CNN CORRESPONDENT: Hi, Wolf.

Well, we now know Phelps won't tie his own record of eight gold medals this summer. That's because he'll only compete in seven events after dropping out of the 200 meter freestyle. His coach made that announcement on twitter, saying it will help Phelps to focus more energy on the three U.S. relays. Phelps, of course, won eight gold medals at the most recent Olympics in Beijing.

And a runoff between two sprinters for a spot in the London Olympics has been canceled. Jeneba Tarmoh says is backing out of the 100 meter dash, saying she understands that she'll now be an alternate in the race. She and sprinter Allyson Felix, look at this, they tied for third place at the U.S. Olympic trials last month and it was so close, even cameras recording 3,000 frames a second, they couldn't tell who won. Tarmoh did not give the reasons for her decision.

And if you don't think tomatoes don't taste very good, well, it may be the tomato, not you. A new study in the journal science says plant breeders have been genetically modifying tomatoes for years to make them look tasty. The result, tomatoes that actually don't taste very good. So, when it comes to tomatoes, the lesson here, Wolf, is you can't rely on just looks -- Wolf.

BLITZER: Good lesson. Thank you.

So why did the chief justice, John Roberts, join the Supreme Court's liberals to save the president's health care plan? We are going to ask Jeffrey Toobin about the mystery.

Stand by.

(COMMERCIAL BREAK)

BLITZER: Some suggest the U.S. Supreme Court may have sprung a leak. CBS News citing two sources that chief justice John Roberts did in fact change his position to side with the liberal justices.

Our senior legal analyst Jeffrey Toobin is joining us right now. He knows a lot about the Supreme Court.

Jeff, what do you make about this possible leak? What's going on in the court?

JEFFREY TOOBIN, CNN LEGAL ANALYST: Well, first of all, my hat's off to Jan Crawford who broke the story. You only had to be in the courtroom and look at the justices' faces last Thursday to see how emotionally engaged they were with this subject. Some of them were angry, some of them were relieved.

I think John Roberts was very moved by the very difficult position he was in. There are strong feelings and they sometimes get out to reporters. They get out to me.

BLITZER: Yes. Is it unusual for a chief justice in a situation like this potentially to change his mind only maybe a few weeks before the final decision?

TOOBIN: Actually this is a very important point. The Supreme Court has always had the internal rule that opinions are not final until decisions are announced. So when they announced their positions to their colleagues on the Friday after oral argument, that is by definition a tentative vote until the opinions start circulating and until every justice has a chance to sign on or reject each opinion. So there is nothing improper or even all that unusual about a justice changing his or her vote while a case is being discussed, obviously in a very high profile case like this it gets a lot of attention. But certainly there's no suggestion that John Roberts did anything wrong by changing his mind.

BLITZER: In a sentence, what does it suggest about the next term of the Supreme Court?

TOOBIN: Well, I think there are a lot more very contentious cases on the horizon. Affirmative action and higher education, the future of the voting rights act, the defense of marriage act.

I think John Roberts will return to being the conserve after he has been for seven years on the court, but in this very important case, he was on Barack Obama's side.

BLITZER: Certainly was. Jeffrey Toobin, thanks very much.

This note to our viewers here in north America, there's a whole new hour of the SITUATION ROOM coming up at the top of the hour, including a seven-month-old crisis that's cost U.S. taxpayers nearly three-quarters of a billion dollars.

And we'll dig deeper into what voters in a half a dozen or so toss-up states are telling pollsters about the presidential election.

We'll be right back.