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THE SITUATION ROOM

Battle Over President's Budget Begins Today; Interview With John Edwards

Aired February 5, 2007 - 17:00   ET

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


WOLF BLITZER, HOST: To our viewers, you're in THE SITUATION ROOM, and it's happening right now.
As violence rages in Iraq, the battle over the president's budget begins here in Washington today. It could and probably will pour billions more into the war.

Would it also hurt health care at home?

I'll speak about that with the Democratic presidential candidate, John Edwards.

And Hillary Clinton and Barack Obama may battle for the African- American voters. But some African-Americans are warning don't take our votes for granted. I'll speak about that with the Reverend Al Sharpton this hour.

And Arnold Schwarzenegger caught on tape with more stunning revelations.

What did he say this time?

I'm Wolf Blitzer.

You're in THE SITUATION ROOM.

What can you buy for about $3 trillion?

The president's new budget is now out and it takes four hefty volumes to show you where your money is going. The president's budget would add billions to fight the war in Iraq.

Does that come at the expense of social programs here at home?

Democrats say it's filled with debt and deception. And even some Republicans are betting against this budget's chances in a Democratic controlled Congress.

Let's go live to our White House correspondent, Suzanne Malveaux.

She's checking all the fine print -- Suzanne.

SUZANNE MALVEAUX, CNN WHITE HOUSE CORRESPONDENT: Well, Wolf, it's a budget that the president and his top economic advisers say is more detailed and transparent when it comes to the costs of the war on terror.

But, again, it is a big question whether or not it is going to be able to pass Congressional leadership, a Democratically-controlled Congress. And, Wolf, the numbers are really staggering.

(BEGIN VIDEO TAPE)

MALVEAUX (voice-over): It's our money and President Bush wants to spend almost $3 trillion of it. It's a staggering figure that's hard for any of us to imagine. But consider this. After you crunch all of the numbers, it's estimated that the total cost for the war on terror will approach $800 billion within the next two years.

President Bush says the increases he's seeking in the new budget are justified.

GEORGE BUSH, PRESIDENT OF THE UNITED STATES: And our priority is to make sure our troops have what it takes to do their jobs.

MALVEAUX: The breakdown -- more than $93 billion additional for this year's war operations in Afghanistan and Iraq, on top of $70 billion already approved. More than $140 billion for 2008. And an 11 percent increase in the Pentagon budget.

Mr. Bush insists the country can afford to boost military spending, while balancing the budget in five years without raising taxes, a claim members of Congress, now controlled by the Democrats, quickly dismissed.

SEN. HARRY REID (D-NV), MAJORITY LEADER: That's why I say this budget is a combination of deception and debt in a way that's disconnected from reality.

REP. NANCY PELOSI (D-CA), SPEAKER OF THE HOUSE: The day of the blank check for the president and the war is over.

MALVEAUX: The president's budget aims at paying for the military increases by cutting out more than $95 billion in other areas over the next five years, including sharply reducing or eliminating more than 140 government programs, for a savings of $12 billion; and squeezing $78 billion out of Medicare and Medicaid, health programs for the elderly and poor.

ROB PORTMAN, WHITE HOUSE BUDGET DIRECTOR: Medicare, Social Security and Medicaid, they are now more than half of the budget. And what the president proposes is actually less than a 1 percentage point reduction in Medicare over five or 10 years.

(END VIDEO TAPE)

MALVEAUX: And the president's budget, of course, asks for less war costs, considerably, in 2009, just $50 billion, and asks for no money the following year. But the president says this is no indication of a timetable for the end of the war or for bringing American troops home -- Wolf.

BLITZER: Numbers so huge it's amazing.

Suzanne, thank you.

Meanwhile, a series of bloody bombings ripped through Baghdad today, killing at least 35 people and wounding more than 120 others. One of the blasts went off near a children's hospital, killing nine people.

And this follows a truck bombing which took a terrible toll this weekend.

As Iraqis clean up and try to cope, some are saying it's America's fault.

And joining us now, our correspondent in Baghdad, Michael Ware -- Michael, they seem to be blaming, at least some elements in the Iraqi government, the United States for this massacre over the weekend that killed more than 100 Iraqis, wounded more than 300 others, horrendous pictures. It looks like the worst suicide bombing over the past three and-a-half years.

What's going on?

MICHAEL WARE, CNN CORRESPONDENT: Yes, Wolf, I mean this was a massive truck bomb in a crowded marketplace on Saturday evening that killed at least 128, and, as you say, wounded more than 300.

Now, the great irony is that there's elements, Shia elements within the government, that are blaming the U.S. for creating this security situation or poor security situation that they say has created an environment that is allowing al Qaeda and others to launch these attacks.

This feeds a common conspiracy, particularly among Shia, that says America is so all powerful and all pervasive, al Qaeda could not conduct these bombings if America was not complicit.

We're not hearing that echoed in the wake of this bombing by elements of this government.

BLITZER: Because what they're saying is by the United States pressuring the Iraqi government to clamp down on Muqtada al-Sadr's Shiite militia, the Mahdi Army, in effect, that's making the Shiites in these marketplace areas and elsewhere in Baghdad, even more vulnerable.

WARE: Yes, they're arguing that this has increased the Shia public's exposure. I mean the government has never been able to underwrite people's security, nor has the U.S. military. So more and more in these days of civil war, they've turned to their own neighborhood or to the local militias.

Now, what these people are saying is that on the eve of what's perceived as a massive American led operation, which, indeed, it is not, many of these militias have evaporated, or their leadership has taken its troops or its fighters off the streets, thereby creating a vacuum which is being filled by these bombers.

Hence, they ultimately blame America for these deaths.

BLITZER: Michael Ware reporting for us from Baghdad.

Michael, thanks.

WARE: Thank you, Wolf.

BLITZER: And as opposition to the war intensifies among the American public, there's a stunning new development within the U.S. military. A court-martial began today for a U.S. Army officer who refused to ship out with his unit to Iraq.

Let's get some details from our Brian Todd -- Brian.

BRIAN TODD, CNN CORRESPONDENT: Wolf, First Lieutenant Ehren Watada took a stand about seven months ago. He's now facing a jury likely to comprise young officers like himself in a case that even his family doesn't expect to go well for him.

(BEGIN VIDEO TAPE)

TODD (voice-over): As his former unit takes casualties in Iraq, Ehren Watada puts his freedom on the line at Fort Lewis, Washington. Watada, considered an exemplary soldier until last June, when he became the first commissioned officer to refuse to go to Iraq.

The reason?

1ST LT. EHREN WATADA, U.S. ARMY: It is my conclusion that war is not only morally wrong, but is, in fact, illegal.

TODD: Watada is not a so-called conscientious objector. While he believes the Iraq War is illegal, he did say he was willing to fight in Afghanistan.

The Army declined and Watada is now being court-martialed for failing to deploy with his unit, conduct unbecoming an officer and contempt toward officials. That last charge, for all the public statements he's made against the Bush administration since last June.

WATADA: I felt betrayed by my leadership.

TODD: But the judge has already ruled that Watada's central defense, that the war is illegal, is a political question and can't be ruled on by this military court. Then there's the challenge of jury selection. By rule, it has to be a panel of peers, likely Army lieutenants.

EUGENE FIDELL, NATIONAL INSTITUTE OF MILITARY JUSTICE: It's highly improbable that this jury will include no one who's been there. So I think the jury selection is going to be an interesting exercise because obviously it's a concern if you have people who have had the actual experience to go to Iraq. TODD: The case has made Watada a poster boy for the anti-war movement, some of whom are protesting near Fort Lewis as his trial gets underway.

(END VIDEO TAPE)

TODD: But Watada is said to be resented by some inside Fort Lewis, where he held a desk job until recently. His family tells CNN they expect this court-martial to be over by Thursday. If convicted, he could face four years in a military prison -- Wolf.

BLITZER: We'll watch it together with you, Brian.

Thanks very much.

Let's go to New York and Jack Cafferty -- this is going to be a big case at Fort Lewis up in Washington.

CAFFERTY: I don't think it's going to be that big a deal. When you're wearing the uniform, you're not allowed to decide whether the war you're ordered to fight in is moral or not. You follow your orders and you go where your unit goes and that's just the way the military -- I mean how would it be if every soldier was allowed to say well, I'll fight in Afghanistan, but I won't fight in Iraq, or I'll go here but I don't think I should go there, because I don't like the way those people -- I mean that's nonsense.

He's dead.

Senate rebuke on Iraq is loud and unclear. That's how one newspaper headline put the story today. The Senate spending all of this time talking about these resolutions criticizing President Bush's plans to escalate the war in Iraq.

Republicans are threatening to block the vote. One Democrat calls that threat obstructionism and they just blather on and on and on.

But when it comes right down to it, all this debate and fussing are about non-binding resolutions. They really don't mean anything in terms of the conduct of the war. They're just sort of a way to register a complaint.

President Bush is the commander-in-chief. The country is at war. He's probably within his rights to do pretty much whatever he wants in terms of adding troops, withdrawing troops, moving troops, whatever. He is the commander-in-chief.

In the meantime, the hopes of a new Congress coming in, getting right to work on this nation's problems, are being held captive by these resolutions, just like the entire country has been held captive by this war for almost four years now.

Nothing that's important to our citizens here is being addressed. Instead, we get posturing and speechifying and bloviating or, as Shakespeare so eloquently put it, a tale told by an idiot full of sound and fury signifying nothing.

The question is this -- how important is it for the Senate to pass a resolution opposing President Bush's troop increase plan in Iraq?

E-mail your thoughts to caffertyfile@cnn.com or go to cnn.com/caffertyfile -- Wolf, whatever they're going to do, I wish they would just get on with it.

BLITZER: Usually they don't do it that quickly here in Washington. It takes a lot of time.

CAFFERTY: All right. We'll wait.

BLITZER: Jack, thank you.

CAFFERTY: All right.

BLITZER: Still to come, my interview with Democratic presidential candidate John Edwards. I'll ask him about his call for pulling U.S. troops out of Iraq, his ambitious health care plan and raising your taxes. That's coming up.

Also, with a growing roster of Democratic candidates, are African-Americans facing a growing divide, especially when it comes to frontrunners like Hillary Clinton and Barack Obama?

Former presidential candidate Al Sharpton, he's stopping by live right here in THE SITUATION ROOM to talk about it.

And a massive slaughter underway right now as Britain tries to contain Europe's huge outbreak of bird flu.

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

(COMMERCIAL BREAK)

BLITZER: While many White House wannabes are dipping their toes in the water, one former contender has already plunged back in and he's making a splash on issues like Iraq, raising taxes for the wealthy to pay for health care.

And joining us now, Democratic presidential candidate in his home state of North Carolina.

Senator, thanks very much for coming in.

Let's get to Iraq first.

If you had your way, how long would it take to pull out U.S. forces from Iraq?

FORMER SENATOR JOHN EDWARDS, PRESIDENTIAL CANDIDATE: About a year. It could take a little more -- a little longer than that. But roughly a year, Wolf -- combat troops.

BLITZER: And what about the support personnel, because there's a lot of support personnel in Iraq, as well?

EDWARDS: Well, the support personnel that are there for the purpose of supporting the combat effort, most of them can leave. But the people who are there for logistical support, to help train the Iraqis, we will need to keep some presence there for a period of time.

BLITZER: Here's what the National Intelligence Estimate said the other day, this compilation, a summary of the 16 U.S. intelligence agencies: "A rapid withdrawal from Iraq would result in these -- in this nightmare scenario. The Iraqi security forces would be unlikely to survive. Iraq's neighbors might intervene openly. There probably would be massive civilian casualties. There would be a Kurdish play for autonomy in the north and that could prompt Turkey to launch a military incursion."

In other words, what they are saying is that as bad as the situation is right now -- and it is horrendous -- it could be even worse if there were a rapid withdrawal.

EDWARDS: It could be even worse no matter what happens, and I think they acknowledge that, too, Wolf, in the same report.

What the NIE tells us is the situation on the ground is very bad, the security situation. The political situation is bad. But the one thing everyone agrees on is the only potential solution in Iraq is a political reconciliation and the threshold question is how do you create the incentives for Maliki and the Shia led government by relatively disorganized Sunni leadership to reach that political reconciliation?

And I think -- others, too -- including the -- those -- some of the people in the Iraq Study Group -- believe that the best way to do it, do that, is to not continue to enable them by keeping our combat troops there for a period -- for a long period of time, or by doing what the president wants to do in escalating the war.

BLITZER: You've said -- you've apologized for your vote back in 2002 when you were in the Senate in favor of the resolution authorizing the president to go to war against Saddam Hussein. Senator Clinton, on the other hand, has not formally apologized.

Does she have credibility on this issue, as far as you're concerned?

EDWARDS: This is an issue between her -- not just for her, but for anyone who voted for this -- for this war -- this is an issue between them and their own conscience. If they believe their vote was right, they should defend it. If they believe their vote was wrong, then they ought to tell the truth about it. It's a pretty simple choice and I think it'll be for voters to evaluate.

BLITZER: Let me rephrase the question.

As far as Hillary Clinton is concerned, does she have credibility when she says that if she were elected president, she would end the war? EDWARDS: You mean do I believe she's telling the truth about it?

BLITZER: Do you believe that she has the credibility, the ability to do what she says she would do, given her track record in the Senate?

EDWARDS: Well, there's no way for me to get inside her mind and heart, Wolf. I mean, she's like everyone else who voted for the war, she has a responsibility, a moral responsibility, to make a decision about whether her vote was wrong or right. This was a question of a war or not. And I think for anyone who wants to be the president of the United States, they need to be honest with the American people.

Senator Clinton is the only one who knows the answer to that question and I think the public will evaluate her, as they will me, Senator Obama and all of the others, on the basis of what they -- what we say and what they see.

BLITZER: Yesterday, you were on "Meet The Press" and you acknowledged -- you said very candidly that if elected president, in order to pay for your health care initiative that you've announced today, to put forward, that you've put forward today, you would have to raising taxes on families making $200,000 a year or more.

Is that right?

EDWARDS: That is correct.

BLITZER: You're -- it brought to my mind this famous comment from Walter Mondale in the presidential debates back in 1984.

Listen. You'll remember this sound bite from the then Democratic presidential nominee.

(BEGIN VIDEO CLIP)

WALTER MONDALE, FORMER PRESIDENTIAL CANDIDATE: Mr. Reagan will raising taxes. And so will I. He won't tell you. I just did.

(END VIDEO CLIP)

BLITZER: All right, so you've just told everyone you'll raising taxes if you're elected president.

Is that a smart political move, given the opportunity now that your opponents will have to hammer you on this sensitive issue?

EDWARDS: My view is that the single most important characteristic of the next president of the United States is somebody who's decent and honest with the country. No one can propose universal health care and say they can pay for it without doing anything to the tax structure. That is not the truth.

And I think the American people deserve and are entitled to the truth, that I suspect the will be other Democratic candidates as we go forward who will follow the lead that I've put out there today and will come forward with their own universal health care plan. And if they contend that they can pay for it leaving the tax cuts and the tax structure exactly as it is, I don't believe that's true. And we'll have to hear what they have to say.

BLITZER: But you're convinced that your health care plan, in effect, will be able to be paid for by this increase in taxes?

EDWARDS: For people who earn over $200,000 a year -- families that earn over $200,000 a year -- they -- they will lose the tax cuts they had under George Bush and go back to what the tax system that existed under Bill Clinton.

But in exchange, we're going to have a more efficient health care system, a less costly health care system. We're going to get rid of a lot of the administrative costs. Every single American will have health care coverage and every -- we'll bring down the costs of the entire system as a whole.

So this is -- this kind of political -- I mean health care reform, which I think is desperately needed and I think the country knows is desperately needed, is the kind of transformation, not small steps, but big steps, that I think we need to take to strengthen this country.

BLITZER: Senator Edwards, thanks very much for coming in.

EDWARDS: Thanks, Wolf.

Thanks for having me.

BLITZER: And you just heard Senator Edwards say he'd raise taxes on the wealthiest Americans to pay for universal health care.

Across the United States, by the way, just 3 percent of all U.S. households make $200,000 a year or more. Here are the top five locations where wealthy Americans could take a hit.

In the District of Columbia, 6.8 percent of households reached that $200,000 threshold. It's 6 percent or more in Connecticut and New Jersey. And in both Maryland and California, almost 5 percent of households might have to pay more under Senator Edwards' plan.

Coming up, Arnold Schwarzenegger unplugged -- find out what he had to say about a key political rival and his own wife in newly released recordings.

And a massive bird flu outbreak in Britain. We're going to show you why it's raising fears the virus could land, potentially, right here in the United States.

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

(COMMERCIAL BREAK)

BLITZER: Let's check back with Carol Costello.

She's monitoring all the developments coming in from around the world.

What's the latest -- Carol?

CAROL COSTELLO, CNN CORRESPONDENT: I have it right here, Wolf.

There is a multi-million dollar settlement in last week's bomb scares in Boston. Turner Broadcasting System, which is CNN's parent company, and the advertising agency Interference, Inc. will pay $2 million. The money will go to city and state agencies to reimburse them for their response. This comes after electronic light boards used in a cartoon promotion set off a terrorism scare last Wednesday and brought in the bomb squads. The agreement resolves any potential civil or criminal claims.

Talks aimed at ending the deadly fighting between rival Palestinian factions get underway in Saudi Arabia tomorrow. A fragile cease-fire appears to be holding, for the most part, in Gaza. But Hamas militants reportedly stormed a Presidential Guard post in northern Gaza today and kidnapped five Fatah security officials. Hamas says the men will be released soon.

The fighting has killed more than 130 people in Gaza since May.

The British government is urging the public not to panic about an outbreak of the deadly bird flu virus. The country's largest poultry producer is destroying tens of thousands of infected turkeys at its farm, but the largest bird flu outbreak to hit Europe. But a British health official says it's very unlikely people could get the disease.

Ireland, Russia, Macedonia and Japan have banned British poultry imports for now.

That's a look at the headlines right now -- Wolf.

BLITZER: All right, Carol.

Bird flu -- let's get a little bit more now. It was first detected in Southeast Asia and you can see on this map how it spread across the continent, through the Middle East into Africa and Europe. It's now confirmed in almost 40 countries. And the virus has now been detected in humans in 11 countries, including Turkey.

The fear is that migratory birds will bring the virus to North America. You can see the routes those birds take on the map behind me. Right now, the virus doesn't pass easily between people, but there is the fear it could mutate and spread from person to person like other forms of the failure.

Coming up, do African-Americans owe loyalty to Senator Hillary Clinton?

A key supporter of potential rival Senator Barack Obama says no. I'll talk about the growing divide, what's coming up on that front with the Reverend Al Sharpton. He's standing by live.

Plus, frigid weather gripping much of the northern part of the United States right now. We'll have the latest on the Arctic blast that has millions of people shivering today.

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

(COMMERCIAL BREAK)

BLITZER: To our viewers, you're in THE SITUATION ROOM, where new pictures and information are arriving all the time. Happening now, President Bush submitting a $2.9 trillion budget to Congress. It includes more than $240 billion for the wars in Iraq and Afghanistan, 90 percent of that sum going to Iraq. And it comes as we're awaiting a key Senate vote on a resolution opposing the president's troop increase for Iraq.

Also, the former New York mayor, Rudy Giuliani, now another step closer to becoming an official Republican candidate for president.

On the Democratic side, African-Americans facing a growing divide -- will they support Barack Obama, Hillary Clinton, someone else?

I'll talk about that. That's coming up. The Reverend Al Sharpton, himself a former presidential candidate, he's standing by live.

And Arnold Schwarzenegger unplugged. Newly released recordings capturing some candid conversation about his wife Maria Shriver, his political opponents, and a lot more. Some of them very unflattering.

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

African-American Democrats are increasingly being torn between their party's two front-runners in the race for the White House. That would be senators Hillary Clinton and Barack Obama. And now underscoring the divide, controversial remarks by one of Senator Obama's key supporters.

Let's turn to CNN's Mary Snow. She's in New York with the story -- Mary?

MARY SNOW, CNN CORRESPONDENT: Well, Wolf, those comments came during a meeting last Friday. One person who was present at that meeting said what was being talked about in public is something many black political operatives have been talking about privately.

(BEGIN VIDEOTAPE)

SNOW (voice over): It's a tug-of-war among black voters being asked to choose between supporting Senator Barack Obama and Senator Hillary Clinton. And comments late last week from Illinois state senator Emil Jones tug even further when he called on support for Senator Obama and made a veiled reference against the Clintons.

EMIL JONES (D), ILLINOIS STATE SENATE: I don't feel that we have to pay a debt to someone. How long are we going to pay this debt when our son is running? And our son deserves their support. That was my message to them. SNOW: Jones made his comments during a meeting at the Democratic National Committee's Black Caucus, making it clear his loyalty to Obama.

JONES: We should be united. And African-Americans understand what I say when I say united. He is our son, and I'm behind him because he's our son.

JAMAL SIMMONS (D), POLITICAL STRATEGIST: No one was prepared for this conversation to take place in that room, and once it did, it sparked some questions among people in the room about where their loyalties should lie.

SNOW: Some political strategists say black voters feel caught between loyalty to President Clinton, who was dubbed by many the first African-American president. At the same time, Senator Obama has the potential to make history. So far, Senator Clinton has been leading in polls, but some say the black vote will be critical.

RONALD WALTERS, UNIVERSITY OF MARYLAND: The nagging question about where Barack Obama stands on issues relative to the black vote, if that's cleared up, then I would expect that his favorability numbers would skyrocket.

SNOW: New York congressman Charles Rangel in January said Obama's lack of experience would hold him back, adding that black voters weren't divided.

REP. CHARLES RANGEL (D), NEW YORK: You compare what you know about Hillary Clinton today and what you know about Obama today and it's not a contest.

SNOW (on camera): What do you mean?

RANGEL: One has to prove himself that he is mature enough, understanding enough, has the intellect to guide the entire country. And, of course, Hillary has proven that.

(END VIDEOTAPE)

SNOW: Now, another political strategist who attended last week's caucus meeting said the black vote is wide open, like the entire Democratic vote.

BLITZER: All right, Mary. Thanks very much.

Let's get some analysis from the Reverend Al Sharpton. He's joining us now from New York. He's president of the National Action Network, also himself a former presidential candidate.

Reverend Sharpton, thanks very much for coming in.

REV. AL SHARPTON, NATIONAL ACTION NETWORK: Thank you, Wolf.

BLITZER: Before we get specifically to what Mary was just reporting, are you planning on running again this time? SHARPTON: I've said I'm not interested in trying to run, unless we get in to the season and I don't see someone really championing the cause of social justice and some of the things I did in the last cycle. I'm very happy doing what I'm doing from National Action Network in trying to add to the debate, but we'll see.

I haven't finally ruled it out. I've met with four of the candidates, I'll be meeting with the rest. And I'm really trying to see who will have a message for those who have been marginalized. So far I've not heard that clear message.

BLITZER: So you're not ready to endorse anyone right now, whether it would be Hillary Clinton or Barack Obama or someone else?

SHARPTON: No, I'm not ready to do that as of yet, no.

BLITZER: Well, do you agree with Charlie Rangel, the congressman from Harlem, when he says that Hillary Clinton has already proven herself and Barack Obama still has not?

SHARPTON: Well, I agree that we know her record better. And we have had agreements and disagreements with that record. But we know it better.

That does not mean we should not come to know Senator Obama's record or, for that matter, any of the other contestants. And I've met with him, I've met with her, and I'm meeting with others. But I agree with him that she has the advantage of being known and having taken some positions. Some we have disagreed with.

I think the big problem that Senator Obama has is that he is not as known, and his track record is not as established as hers. But, again, he has time to try and correct that, if, in fact, he can.

I agree more with Professor Ron Walters when he says it is the issues and positions that are taken that I think is going to determine where the majority of the African-American vote ultimately goes.

BLITZER: And you heard Emil Jones, that politician from Illinois, make that statement that Mary -- that Mary included in her piece, saying that, you know, the African-American community really doesn't owe the Clintons anything else, and right now it's a time to unify around Barack Obama.

SHARPTON: Well, I think the problem with that is that you can offend people by saying that you've got to unite just because someone is your race and, therefore, not address the issues. I think that the better way is for Senator Obama or anyone else to stand up on the issues and say, let's unite around the issues. Not unite around who is someone kindred to us, because you really don't want to set that kind of scenario up.

For example, right in Chicago, where there's a mayor race, Senator Obama's endorsed the incumbent white mayor against two black candidates. So you really don't want to nationally say that blacks should do something for Obama that he himself is not doing at home. That is not a debate you want to raise, because then you can name any number of races where people didn't support blacks against whites. I think what is intelligent and respectful to our community, as in any community, is to talk our interests and our issues. Don't raise an issue that you may not want to come home and have to answer.

BLITZER: Let me pick your brain on two other issues.

First of all, Senator Joe Biden, I know he was on your radio show after he made those controversial comments about Senator Barack Obama. Are you over that issue now? Is it time to move on? Or is there still a problem you sense Senator Biden has?

SHARPTON: I mean, well, Senator Biden said what he said, and as I told him on the show, it offended a lot of people. I certainly did not think that it was a thing that was not offensive.

I know Senator Biden, and he said his intention was not to in any way desecrate those of us that ran for president before, being Shirley Chisholm or Reverend Jackson, me, or whoever. But the suggestion that people that, because they may not have a certain style, is not articulate or even clean, I thought was a bit much.

I said it, but, again, I think that the debate must be around the issues. The disparity in income in income in this country based on race, the disparity in how the criminal justice system is used -- it just came out over the weekend in New York that blacks, who are a third of the city, are stopped 55 percent of the time in stopping and frisked by police.

These are the things that people want to know, as president, what will you do to even the playing field? And that's going to be a little deeper than someone's gender or race or comments. And if we don't get to that level, then it won't be in the interests of not only African-Americans, but any Americans united around the candidates.

BLITZER: One final question on Rudy Giuliani. He took another step toward a run for the White House today. You were quoted in "The Times," "The New York Times" on Sunday, as saying, "So right now, he can lead all the media and the national pundits on the yellow brick road. He'd better never let us get near that veil. I know what's back there. I've pieced it before."

What are you alluding to?

SHARPTON: Well, I think that Rudy Giuliani had one of the most polarizing and divisive terms of mayor in the history of the city of New York. Anyone knows that.

His confrontations with the communities of African-Americans and Latinos, his problems in terms of dividing the city, and many other issues will come to light. I think that as soon as the honeymoon is over with the media and he jumps in the ring, he becomes fair game, and I think that a lot of the title of "America's mayor," people are going to have to examine what that mayor (ph) was, and it will not be as flattering as it has been up until now. BLITZER: I don't think the Reverend Sharpton is going to vote for Rudy Giuliani.

Hey, Reverend Sharpton...

SHARPTON: You've got a good guess.

BLITZER: Yes. Thanks very much.

SHARPTON: You also think the Colts are going to win the Super Bowl. Don't you?

BLITZER: Maybe. Maybe.

Thanks very much, Reverend Sharpton, for coming in.

And up ahead, California governor Arnold Schwarzenegger making some unflattering remarks about a political rival. We're going to have details of some newly released recordings, what he did say, he didn't say. He didn't want these recording, though, made public.

Plus, the Senate heading to a showdown over the president's handling of the war in Iraq. We're awaiting a crucial vote. It could come up soon. We'll tell you what's going on in the Senate.

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

(COMMERCIAL BREAK)

BLITZER: Dangerously cold weather has much of the northern United States in a deep freeze this afternoon. And lake effect snow is piling up in upstate New York. As much as two feet falling in some areas, closing roads, including parts of Interstate 81, earlier.

Law enforcement, by the way, warning people to stay off the roads.

In Chicago, no snow right now, but bitter cold temperatures. The high today was only a few degrees above zero.

The CNN forecast does call for snow in the Windy City tomorrow and a high -- get this -- of only 10 degrees. And the cold snap is even catching the breath of Minnesotans. It hit 8 degrees below zero in Minneapolis this morning, making conditions miserable for a lot of people, including these firefighters.

Images of the arctic blast are coming in from around the country through CNN's I-Report. Let's go to our Internet reporter, Jacki Schechner. She has the latest look on the frigid weather -- Jacki.

JACKI SCHECHNER, CNN INTERNET REPORTER: Wolf, we've got bold I- Reporters trying to stay warm and sending us photos.

This is Francisco Roque in Ann Arbor, Michigan. He says he rode his bike six miles to work this morning and this is what he looked like when he got there. This is a self portrait. He says he wears a helmet, he was bundled up. But still, the moisture from his breath froze, and you can see that right there on his beard.

We have another I-Reporter named Dorte Jones who took this for us in Cavalier, North Dakota. This is the thermometer outside her garage.

You can see right here it is 30 degrees below zero. She says this is the first time she's seen it this cold in the 12 years she's lived in the area. She thinks that this is why the crime rate in the area is so low, because it's too cold for anyone to go outside.

And this photograph comes to us from Suzanne Velonis, who is in Chicago, Illinois. Took this photograph last night after watching the Bears unfortunately lose the Super Bowl.

She says it was negative 4 degrees. That was cold, but it was even colder this morning. She got up and it was negative 10.

Again, this one in Chicago.

If you want to calculate the wind-chill in your area for yourself, you can do that online from the National Weather Service. They have a wind-chill calculator. For example, if it's 20 outside, the wind's 21, that gives you a wind-chill of 4 degrees -- Wolf.

BLITZER: Jacki, thanks very much.

Jacki reporting.

They just started voting on the floor of the U.S. Senate on an important resolution that could set the stage for a showdown over the war in Iraq.

Dana Bash, you're watching all of this. Explain to our viewers what's happening right now.

DANA BASH, CNN CONGRESSIONAL CORRESPONDENT: Well, what's happening now is you're about to see the latest proof that Senate Democrats may have a majority here in Congress, but it does not mean they have the votes to guarantee they're going to get their way, because what you're seeing is what Democrats hoped would be the beginning of a full-scale debate on Iraq, on a resolution opposing the president's plan to send more troops to Iraq, but that is not going to happen at the end of this vote, because anything in the Senate really needs 60 votes to pass. And Republicans are using the Senate rules to their advantage, and they're making it clear that they are going to block this vote to proceed to a major debate on Iraq.

Why? Because Republicans say that they want to have some of their resolutions passed. Democrats say that is purely obstructionism. So you're going to see this vote, it's going to fail, and then Democrats and Republicans are going to go behind closed doors and try to figure how to get some kind of agreement.

BLITZER: And where they go next.

All right. Thanks very much, Dana, for that.

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

Lou, what are you working on?

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

Coming up at 6:00 p.m. Eastern here on CNN, we're reporting on the Bush administration's determination to push forward with what is being called a North American union without the consent of Congress or the American people. The Bush administration defended its plan in, you guessed it, Mexico City. Imagine that.

We'll have that special report.

Also tonight, some local law enforcement agencies are helping to remove criminal illegal aliens from the streets of this country, despite protests by the illegal alien open border lobby.

We'll have that story and tell you what we can expect in the months ahead.

And a new warning that our public education system is failing an entire generation of our students.

We'll have that special report. And I'll be talking with the head of the educational testing service that issued the warning. Kurt Landgraf is among our guests here tonight.

Senator Byron Dorgan also joins us tonight to tell us why he opposes the president's efforts to negotiate trade deals without congressional approval to have Fast-Track Authority returned to him.

We hope you'll join us for all of that and a great deal more, all the day's news.

Wolf, back to you.

BLITZER: We'll be watching in a few minutes. Thanks very much, Lou, for that.

And coming up in our 7:00 p.m. Eastern hour right here in THE SITUATION ROOM, it's the hottest title in Washington, at least today, President Bush's almost $3 trillion budget. CNN's Jeanne Moos is going to be taking a special Jeanne Moos kind of look at the new budget.

Plus, what California governor Arnold Schwarzenegger says about his wife, as well as a political rival. We're going to have details of some newly released recordings.

We'll be right back.

(COMMERCIAL BREAK)

BLITZER: There are some new recordings out from meetings between Arnold Schwarzenegger and his aides, and they reveal some very candid and unflattering comments by the California governor about some of his opponents.

Let's go back to CNN's Carol Costello. She's following the story for us -- Carol.

CAROL COSTELLO, CNN ANCHOR: Wolf, the recordings were made in 2006 for a Schwarzenegger speechwriter with full knowledge of the governor. The hope was that listening to the governor's casual conversation would help write a better speech. The problem is, they were mistakenly put on the governor's Web site and lifted by political rivals.

(BEGIN VIDEOTAPE)

COSTELLO (voice over): The recordings are very much Arnold unplugged, backroom conversations, a window into what he really thinks.

GOV. ARNOLD SCHWARZENEGGER (R), CALIFORNIA: Please, Senator.

COSTELLO: Schwarzenegger, who is heard talking with his aides about his political opponents, dishes about Democratic state senator Don Perata.

SCHWARZENEGGER: Perata is a very sick man.

UNIDENTIFIED MALE: Really?

SCHWARZENEGGER: Yes, absolutely.

COSTELLO: Quite a revelation from a politician who prides himself on his bipartisanship.

The question is, will that bipartisan cooperation continue?

PETER NICHOLAS, "LOS ANGELES TIMES": The governor's staff told me last night that Schwarzenegger had apologized, but I spoke to Senator Perata's office this morning, and they said the senator had gotten no apology from the governor and described the senator as being not in a particular happy mood this morning.

COSTELLO: The governor also discusses another hot-button issue -- immigration. He calls the idea of a fence between Mexico and the United States ridiculous. And when it comes to the subject of assimilation, he says Mexican immigrants do need to work harder to assimilate in the United States.

SCHWARZENEGGER: We love Mexico and we go there on vacation. We love to hear the mariachi music and all that stuff. But up here, for us to feel sympathetic towards you, you have to carry the American flag, and you have to say, "We want to be part of you. We love you."

(END VIDEOTAPE)

COSTELLO: The governor's office released the tapes in their entirety today, saying it did that to prove Mr. Schwarzenegger's comments are part of a long and thoughtful dialogue.

BLITZER: Carol, what are the governor's political rivals saying about this?

COSTELLO: Well, I called state senator Don Perata's office myself today, and his press person told us he's a little upset, but he can't start a war over this. As a politician, he says there have been worse things said about him.

BLITZER: And finally, Carol, what did we learn about Maria Shriver from these recordings?

COSTELLO: She likes detail. She's very involved in speechwriting. In fact, she reviews the governor's speeches.

He says on this tape -- and I quote -- "She is relentless. She will not stop. You know with a speech, like, for a convention or something like that? She goes until the last day. I said, 'Maria it's over, it's locked in. It's in the teleprompter.'"

I'll have more at 7:00.

BLITZER: All right. Thank you. We're going to be watching that.

Carol doing good reporting for us.

Up next, Jack Cafferty wants to know, how important is it for the Senate to pass a resolution opposing President Bush's troop increase plan in Iraq? Jack with your e-mail when we come back.

(COMMERCIAL BREAK)

BLITZER: Let's go to New York and Jack Cafferty for "The Cafferty File" -- Jack.

JACK CAFFERTY, CNN ANCHOR: Wolf, the question this hour is: How important is it for the Senate to pass a resolution opposing President Bush's troop increase plan in Iraq?

Ron in San Francisco writes, "We need resolutions that are as binding as the deaths of our kids over there. Not some chicken little, no-confidence resolution like this. The American people spoke loud and clear last November to end the war, not fight over condemning a Bush escalation of it. Wake up guys, or we'll muck out the barn again in two years."

Aaron in Pennsylvania, "Very important. If no one goes on record opposing the war, the President Bush will say, 'Nobody said they were against my plan when this all started.' I hope the politicians learned an important lesson from the vote that they took that got us in to this mess four years ago." Bernie in Binghamton, New York, "It's of no importance, Jack. It's merely grandstanding. If the Congress wanted to oppose this stupid, unwinnable war, it should do two things -- deny Bush the funds to continue the war, impeach both Bush and Cheney. The time has come for serious action, not for political posturing."

Armin in Litchfield, Connecticut, writes, "If they do nothing else for the rest of the year except vote against a troop increase, they have saved us poor taxpayers trillions in future expenses, and most likely a few thousand American lives. Maybe that's asking too much of our senators."

Barbara writes from Niles, Michigan, "The sad truth is the Republicans cannot seem to accept they are no longer the majority in the Senate. They're now trying to filibuster the Iraq debate and the Iraq resolution. I think they'd better get on the side the people, or I predict there'll be fewer Republicans in Congress after the next election."

Luzma, Lewiston, Maine, "I have two nephews in Iraq right now. I don't want to see them come home in coffins. Therefore, this vote against the surge is crucial on how I will vote for Senator Susan Collins in 2008."

"Any Republican who votes with the president is ignoring a powerful voice in our democracy -- our vote. We voted in November for change, and we demand it."

John writes from Delaware Water Gap in Pennsylvania, "A non- binding resolution? Spineless comes to mind. If those yo-yos are serious about their disagreement with the president, they ought to cut off funding and force a withdrawal in six months. Damn, it sucks being helpless and represented by these idiots. Maybe we need to be liberated."

And Joseph, finally, in Norman, Oklahoma, "Jack, the Senate's fighting for the best way to do nothing. As usual."

If you didn't see your e-mail here, you can go to cnn.com/caffertyfile, where you can read more of these online -- Wolf.

BLITZER: You k now, a lot hovering over this whole debate. There are 20 Republicans senators who are up for re-election next year, and they're all very worried about how this vote might play. We'll talk a little bit more about that in an hour, Jack.

Thanks very much.

Remember, we're back at 7:00 p.m. Eastern, another hour of THE SITUATION ROOM.

In the meantime, let's go to Lou Dobbs in New York.

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