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THE SITUATION ROOM

Collapse of the Compromise on Immigration Reform. Jefferson's Response to His Charges.

Aired June 8, 2007 - 16:00   ET

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


WOLF BLITZER, HOST: Thanks very much, guys.
Happening now, the finger pointing.

Now that the immigration reform deal has fallen apart, what's next?

We're tracking the blame game, the presidential campaign fallout and what's going to happen.

Plus, the drive to keep big oil in check in California and beyond. The attorney general of California, Jerry Brown, he's standing by to join us live after giving Congress an earful today. I'll press him on energy and on the immigration reform bill's collapse.

And a Congressman pleads not guilty to corruption charges. Democrat William Jefferson is talking publicly now for the first time about the wads of cash found in his freezer.

I'm Wolf Blitzer.

You're in THE SITUATION ROOM

The Bush White House is holding out hope that Congress still can approve an immigration reform bill. But for now, the compromise is effectively dead. Senators refused last night to limit debate on the bill. And the majority leader, Harry Reid, pulled the plug on it. That unleashed a flood of blaming and second guessing.

Bill Schneider is standing by.

But first, let's go to our Congressional correspondent, Dana Bash -- Dana, how did we get to this point?

DANA BASH, CNN CORRESPONDENT: Well, Wolf, as you strip it down to the bare basics, it's simply that supporters of this compromise could only get 45 of the 60 votes they needed to keep this bill alive. But as you know from watching the political debates surrounding immigration, it is much more complicated and much more emotional than that.

(BEGIN VIDEO TAPE)

BASH (voice-over): Last month, bipartisan bargainers announced the immigration deal with fanfare and optimism.

SEN. JON KYL (R), ARIZONA: It represents the best opportunity that we have, in a bipartisan way, to do something about this problem.

BASH: Now, standing at the same podium just a few weeks latter

KYL: Yes, I am disappointed.

BASH: So how did the grand bargain turn into the great collapse?

The classic Washington blame game has begun. Exasperated supporters say it was fear mongering.

SEN. DIANNE FEINSTEIN (D), CALIFORNIA: I listened to talk show hosts drumming up the opposition by using this word amnesty over and over and over again and essentially raising the roil of Americans to the extent that in my 15 years I've never received more hate or more racist phone calls and threats.

BASH: But those against citizenship for illegal immigrants say their opposition was hardened by insulting statements from the president.

GEORGE BUSH, PRESIDENT OF THE UNITED STATES: It's not an amnesty bill. That's empty political rhetoric trying to frighten our fellow citizens.

BASH: Some Republicans, and even Democrats, blame Senate Majority Leader Harry Reid for trying to limit Senators' ability to change the controversial bill.

SEN. TED KENNEDY (D), MASSACHUSETTS: I personally believe that if we had taken more time, we would have had an opportunity of reaching a conclusion.

SEN. JOHN CORNYN (R), TEXAS: The Democrat majority leader squandered an opportunity. We were very close, I think in a matter of days, of being able to complete this bill.

BASH: Most Democrats accuse Republicans of stall tactics.

SEN. KEN SALAZAR (D), COLORADO: You know, they kept asking for six more hours, for 12 more hours. This has been going on for two weeks. The fact is there were some members on the Republican side who didn't want the bill.

BASH: Then there's this -- blame everyone.

SEN. ARLEN SPECTER (R), PENNSYLVANIA:

I think that Democrats were wrong. But the Republicans were wronger -- to use a word which doesn't exist.

(END VIDEO TAPE)

BASH: Now, supporters of the immigration compromise are vowing to press on, insisting this bill isn't dead yet. President Bush will be here on Capitol Hill to try to rally support early next week. But the reality is the Senate has a jam packed schedule for the next several months, Wolf, and Democratic leadership aides say that they just don't see immigration coming back to life anytime soon.

BLITZER: Dana, as you know, a third of the Senate is up for election next year. This bill was especially hard for those Senators who face reelection to support.

BASH: It sure was. Our producer, Evan Glass, looked at the numbers and he found that two thirds of senators up for reelection actually voted against the motion that would have kept this bill alive last night. That is very telling in terms of the political dynamics surrounding immigration and why, as we get closer to the election, Wolf, it will be much, much harder to resurrect this bill.

BLITZER: Dana is watching this story on Capitol Hill.

Supporters of the so-called grand bargain on immigration clearly have suffered a huge defeat and that could influence the presidential race.

Let's bring in our senior political analyst, Bill Schneider.

Is there likely to be a lot of fallout in the political contest from this collapse -- Bill?

WILLIAM SCHNEIDER, CNN SENIOR POLITICAL ANALYST: Well, Wolf, the failure of the immigration bill certainly looks like a defeat for John McCain.

But is there any way it could be a blessing in disguise?

(BEGIN VIDEO TAPE)

UNIDENTIFIED MALE: The yeas are 45 and the nays are 50.

SCHNEIDER (voice-over): The failure of the immigration bill looks like the worst possible outcome for John McCain. He championed a bill that was deeply unpopular with conservatives, as rivals like Mr. Thompson were eager to note.

TOMMY THOMPSON (R), PRESIDENTIAL CANDIDATE: And the people that are supporting it, like Senator McCain, I think, are going to have a difficult time explaining their position to the base.

SCHNEIDER: The fact that the Senate deal collapsed, with the Republicans voting 38-7 against it, looks like a failure of leadership, from President Bush certainly; but possibly also from Senator McCain.

SEN. JOHN MCCAIN (R), ARIZONA: We need to act, my friends. And if someone else has a better idea, I'd love to have them pursue -- give it to us.

UNIDENTIFIED MALE: Thank you.

SCHNEIDER: The other Mr. Thompson?

FRED THOMPSON (R), FORMER U.S. SENATOR: You've got to secure the border first before you do anything else.

SCHNEIDER: On the other hand, the bill failed. That could satisfy critics and get the controversy out of the headlines. It would certainly be in McCain's interests for the campaign to move on. But the immigration problem is not going away. McCain himself has argued...

MCCAIN: For us to do nothing is silent and de facto amnesty.

SCHNEIDER: He also said...

MCCAIN: This isn't the bill I would have written.

SCHNEIDER: For many Americans, the collapse of the immigration deal doesn't bring satisfaction, it brings frustration. The system failed.

SEN. HARRY REID (D-NV), MAJORITY LEADER: There's lots of support for this bill on the outside. The problem was on the inside of this Senate chamber.

SCHNEIDER: And McCain is running on a promise to fix the system.

(BEGIN VIDEO CLIP FROM REPUBLICAN PRESIDENTIAL DEBATE)

MCCAIN: It's our job to do the hard things...

BLITZER: Mayor, go ahead.

MCCAIN: ... not the easy things.

(END VIDEO TAPE)

SCHNEIDER: The Senate deal was much too complicated. It may be easier now to have a serious debate, once the deal has collapsed. You can deal with the pieces one at a time. And it could give McCain the opportunity, perhaps, to offer a bill more to his liking -- Wolf.

BLITZER: Thank you, Bill.

CNN's Bill Schneider and Dana Bash -- both part of the best political team on television.

And remember, for the latest political news at any time, you can always check out our political ticker at cnn.com/ticker.

Five of the six senators running for Senate tried to keep immigration compromise alive. That would be Democrats Hillary Clinton, Barack Obama, Chris Dodd and Joe Biden. They voted to limit debate. So did Republican Senator John McCain. Another Republican senator, Sam Brownback, did not -- repeat -- not, did not cast a vote.

Let's go to Jack Cafferty.

He's in New York.

He's got The Cafferty File -- hi, Jack.

JACK CAFFERTY, CNN CORRESPONDENT: Hello -- Wolf.

BLITZER: BLITZER: Worse than Watergate -- that is how Democratic Congressman Jerry Nadler describes the actions of the Bush administration when it comes -- you want to scroll the prompter up so I can continue here?

No, that's backwards. Turn it the other way.

When it comes to describing the NSA warrantless wiretapping program. Nadler called it a felony -- a felony -- and said that the president and the attorney general engaged in a criminal conspiracy that is worse than Watergate.

He tells Josh Marshall of "Talking Points Memo": "I think the one issue that hasn't gotten enough attention is the overwhelming obviousness of the fact that this entire warrantless wiretapping is illegal."

Nadler is chairman of the House Judiciary Subcommittee On the Constitution, Civil Rights and Civil Liberties.

He's holding a series of hearings called The Constitution In Crisis: The State of Civil Liberties In America. And he says the time has come now to "void the blank check the White House has enjoyed for the past six years."

So here's the question -- Congressman Jerry Nadler says the actions of the Bush administration when it comes to NSA wiretapping are worse than Watergate.

Is he right?

E-mail caffertyfile@cnn.com or go to cnn.com/caffertyfile -- Wolf.

BLITZER: BLITZER: Thank you, Jack.

Coming up here in THE SITUATION ROOM the vice president, Dick Cheney, gets a checkup of his heart and of the pacemaker that keeps it going strong. We're going to tell you why he now needs a new battery.

Also, Congressman William Jefferson says he doesn't do it. The Democrat makes a plea before a judge on bribery charges and urges the public to keep an open mind.

Plus, the next dust up in Congress. A vote of no confidence in the attorney general, Alberto Gonzales. James Carville and J.C. Watts -- they're standing by live. They'll cast their votes in our Strategy Session.

Stay with us.

You're in THE SITUATION ROOM.

COMMERCIAL

BLITZER: Welcome back.

Congressman William Jefferson is vowing today to fight the corruption charges against him, saying the allegations -- and I'm quoting now -- "are not who I am."

The Louisiana Democrat pleaded not guilty in a courtroom here in the nation's capital.

CNN's Brianna Keilar is covering this case for us -- Brianna, Jefferson is adamant in his denials and he was very forceful when he made that public statement.

BRIANNA KEILAR, CNN CORRESPONDENT: That's right, he certainly is denying these charges, even telling reporters today he will sell every last stick of furniture to fund his defense and clear his name.

(BEGIN VIDEO TAPE)

KEILAR (voice-over): Embattled Congressman William Jefferson is vowing to take on the Justice Department.

REP. WILLIAM JEFFERSON (D), LOUISIANA: I am absolutely innocent of the charges that have been leveled against me. And we're going to fight -- I'm going to fight my heart out to clear my name.

KEILAR:

In a federal courtroom in Virginia, Jefferson entered a plea of not guilty to 16 charges, ranging from soliciting bribes to racketeering to money laundering.

JEFFERSON: This is not who I am. This is not what I have done.

KEILAR: Government prosecutors allege Jefferson received more than $500,000 in bribes and sought millions more using a network of family companies to hide the money. One of the most salacious allegations, that in 2005, Jefferson solicited a bribe from a government informant in return for promoting a company's joint venture in Nigeria.

CHUCK ROSENBURG, U.S. ATTORNEY: Mr. Jefferson requested $100,000 in cash from the cooperating witness. Mr. Jefferson said he would provide the $100,000 in cash to the Nigerian official as a bribe payment.

KEILAR: Shortly after the alleged exchange, the Justice Department says $90,000 of that money was found in a freezer in Jefferson's Washington home.

For the first time, Jefferson talked about the so-called cold cash.

JEFFERSON: Did I bribe a foreign official? Absolutely not. The $90,000 was the FBI's money. The FBI gave it to me as part of its plan, part of their plan, that I would give it to the Nigerian vice president. But I did not do that.

(END VIDEO TAPE)

KEILAR: After Jefferson waived his right to a speedy trial, buying his lawyer time to pore over file cabinets worth of documents, Judge T.S. Ellis set Jefferson's trial date for January 16th of 2008.

Jefferson insists he has served his constituents honorably and will not resign from the House of Representatives -- Wolf.

BLITZER: BLITZER: Brianna, Congressman Jefferson is out on his own recognizance. I take it he's had to surrender his passport.

What other conditions is he facing right now?

KEILAR: Well, he can travel unrestricted in the Washington area and also in Louisiana. But he has to check in with the court to travel to other states. And since Jefferson owns hunting rifles and shotguns, the judge is forcing him to surrender access to those weapons -- Wolf.

BLITZER: Brianna Keilar watching this story for us.

Even though William Jefferson has been introduced, there aren't any House rules or federal laws that require him to quit Congress. Internal party rules require an indicted law maker to step down as a committee chairman, a ranking panel member, a party leader.

If he's convicted, Jefferson would not -- not -- automatically lose his office. But under House rules, he could be denied a vote on the floor or in committee if he's sentenced to two more years in prison. Fellow House members can expel a convicted lawmaker from Congress by a two thirds majority vote.

Carol Costello is joining us right now from New York.

She's monitoring some other incoming stories making news -- hi, Carol.

CAROL COSTELLO, CNN CORRESPONDENT: Hi, Wolf.

Let's start with weather woes in Wisconsin and elsewhere in the Midwest. Right now many people are literally picking up the pieces after thunderstorms and tornadoes tore through yesterday. Hail the size of baseballs pelted some areas of Wisconsin and a kayak actually sliced through a tree, apparently from a tornado in the north. Officials reported at least five twisters touched down in the state. No serious injuries to report. There are also reports of a tornado in western Minnesota and in North Dakota, heavy rains.

In another example of how violent nature can be, a freak storm on Australia's east coast rips a 40,000 ton ship from its moorings and pushes it into a sand bank. Rescuers saved the ship's crew, but officials now fear the ship could literally break apart, possibly leaking hundreds of tons of fuel oil and diesel into the sea. And that's what officials fear could blanket the coastline with a "black, tarry slick."

The Bush administration is suspending a post-9/11 security measure, at least temporarily. Until the end of September, U.S. Citizens will be allowed to fly without a passport if they're flaying to and from Canada, Mexico, the Caribbean and Bermuda. The travelers will, however, have show a State Department receipt showing they have applied for a passport and a government issued piece of I.D. The new rule had threatened to disrupt the summer travel plans for many American who do not have their passports.

And are you in a mood because of economic blues?

You might blame high gas prices and low home prices. It appears consumer confidence is battered as that index falls to a 10 month low. Experts say gas prices and the sluggish housing market are causing nagging worries.

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

BLITZER: We'll check back with you shortly, Carol.

Thank you.

Still ahead here in THE SITUATION ROOM, the countdown to the launch of the Space Station Atlantis, with seven astronauts on board.

Are all systems go?

We'll get an update online.

And the father who is a congressman turned presidential candidate. The son is a marine who hopes to inherit his dad's House seat. We'll follow Duncan Dwayne Hunter on the trail in California.

Stick around.

You're in THE SITUATION ROOM.

COMMERCIAL

BLITZER: Today, the vice president, Dick Cheney, went for a routine medical checkup. While doctors say there are no new blockages in his heart, they did discover that the pacemaker in his chest needs a new battery.

Let's go to our medical correspondent, Elizabeth Cohen -- how difficult of a procedure is this, Elizabeth, to replace the battery?

ELIZABETH COHEN, CNN MEDICAL CORRESPONDENT: Wolf, it's not very difficult at all. It is done all the time. It's done -- it's a one day procedure. The vice president will not have to spend the night at the hospital. It's done under local anesthesia. The battery pack for this device is about the size of a pack of cigarettes. They make an incision, they go in, they change it. That's it. BLITZER: What are the risks?

I assume -- in all surgery, in any kind of procedure, there are some risks.

COHEN: Right. There are very few risks for this. The main risk would be a risk of infection. Anytime you're cutting into someone, there is a risk of infection. And, of course, patients often feel pain at the incision site when they have this procedure done.

BLITZER: So it's just one night or he doesn't even have to spend a night?

COHEN: Not even. It's a same day procedure. It's you're in there, you're out of there in one day.

BLITZER: And normally these batteries are supposed to last for how long?

COHEN: About three to four years.

BLITZER: And -- but everything else, he seemed to check out just fine, even, though he did have a little scare a few months back.

COHEN: Right. He had that scare with the blood clot, which was taken care of. But, yes, what they're doing right now is routine -- routine maintenance. I don't mean make to make him sound like a car. But this is basically routine maintenance. The battery pack has to be changed every couple of years.

BLITZER: Well, let's hope everything goes smoothly.

Thanks very much for that.

COHEN: Thanks.

BLITZER: Elizabeth Cohen watching this story for us.

We're also counting down to the launch. The Space Shuttle Atlantis is set to take off with seven astronauts later today after months of delay and we'll be watching it live here in THE SITUATION ROOM.

That launch scheduled during our 7:00 p.m. Eastern hour. We're going to have live coverage. Miles O'Brien is standing by for that. He's on the scene.

In the meantime, though, let's bring in our Internet reporter, Abbi Tatton -- Abbi, you're watching this, as well, online.

What are the astronauts doing right now?

ABBI TATTON, CNN CORRESPONDENT: Well, at nasa.gov, Wolf, you can really check in and see what's happening every last minute as we head toward the countdown. Right now, they've got a launch blog describing the final inspections. And look at this, as well. This is a live stream where we watch and we've seen the astronauts just arriving, being suited up, ready for launch.

And as the pictures keep changing, we're now seeing them getting seated. And their mission is described here online in this tool that they have at nasa.gov.

You can see that they're going to be doing three space walks during the trip there. They're taking equipment up to the International Space Station -- a new segment, along with a pair of solar panels. This is a space station assembly project that's going to be continuing throughout several shuttle missions, until 2010.

So we're going to keep checking back at this Web site right now. We're now a little over three hours away -- Wolf.

BLITZER: We'll be watching every second of this.

Thanks very much.

Seven astronauts on board. We've got some live pictures I'm going to show you right now. There you see it. These are pictures coming in courtesy of NASA. The astronauts going through the finishing touches as they prepare to be launched into space. They're going out tonight.

One of those astronauts will replace someone else aboard the International Space Station. This is always, always a remarkable sight. And each minute brings us closer to the launch of the shuttle. We're watching it, the Atlantis. Millions of people, in fact, will be watching, as these seven astronauts take off.

We're going to bring you the launch live as it happens. You'll want to see it. That's happening later tonight during our 7:00 p.m. Eastern hour right here on THE SITUATION ROOM.

Miles O'Brien is standing by. He'll join us there, as well. A major development, NASA facing some serious problems in recent months. But they're ready for the Atlantis to take off and go up in space.

Up next, is California better off now that an immigration reform compromise has not passed?

I'll ask the attorney general of California, the former presidential candidate, Jerry Brown. And I'll press the attorney general about possible gas price gouging and whether oil companies should be investigated. Pain at the pump, ahead right here in THE SITUATION ROOM.

COMMERCIAL

BLITZER: Happening now, an Israeli newspaper reports Israel has told Syria it may be willing to give up the Golan Heights if Syria cuts its ties to Iran and ends its support for Hezbollah and Hamas. The report says Israeli Prime Minister Ehud Olmert sent the message to Syria through Germany and Turkey, and that Syria has not yet responded. We'll stay on top of the story.

Officials say they wanted to sell grenade launchers, machine guns and millions of other dollars of other weapons to terrorists in Colombia. Police have nabbed three men in Spain and Romania, all wanted by the U.S. They allegedly wanted to sell weapons to leftist guerillas who have long fought the Colombian government.

The Pentagon will ask two judges to reconsider their decisions in two Guantanamo Bay detainee trials. Those judges had dismissed charges against two terror detainees at their military commission trials. The judges said a technicality meant they lacked jurisdiction.

I'm Wolf Blitzer and you're in THE SITUATION ROOM.

It's dead for now, but can it be revived?

Let's get some more now on our top story. A compromise immigration bill has effectively been killed in the U.S. Congress.

Joining us now to discuss that and what many believe is a global warming crisis, the California attorney general, Jerry Brown.

Attorney General, thanks very much for coming in.

JERRY BROWN (D), CALIFORNIA ATTORNEY GENERAL: Good to be here.

BLITZER: Are people in California, and the nation, for that matter, better off now that this immigration reform compromise has simply, at least for the time being, collapsed?

BROWN: No, not at all. California faces an immediate problem of getting enough workers to pick the crops. That's key to agriculture.

Secondly, we have millions of people who are illegal, undocumented. And they have to drive cars, which is another crime. And it creates a...

BLITZER: Because they don't have driver's licenses?

BROWN: They don't have driver's licenses. And they're illegal. But their kids are go to school. They're contributing to the economy. They need to be regularized. This is a very important human -- more than economics. It's a human tragedy...

BLITZER: Well, you're...

BROWN: ... that we've got to clean up. And Congress ought to go back to the drawing boards and make the necessary compromises.

BLITZER: You're an astute observer of things -- all things political here in Washington.

What happened?

Because you had the president of the United States. You had Senator Kennedy, Senator McCain. You had Senator Kyl. You had left- wingers, right-wingers. They were all on board and all of a sudden it collapsed. BROWN: Well, the fear of the stranger. These are -- this is this a foreign element in the country. And I think there's a lot of political mileage for fighting that. And there's some justified concern about language, about the stability in our inner cities.

But when you cut it all back, we have to do something. We have 12 million people who are illegal. We have to make that lawful. Secondly, then we have to deal with Mexico.

BLITZER: Who do you blame for the collapse?

BROWN: Who do I -- I blame the obstructionists who are exploiting the issue and not -- not recognizing reality. You cannot keep 12 million people in this state of legal bondage. You can't.

BLITZER: Because they argue, you know, the conservative radio talk show hosts, the Tom Tancredos, the Duncan Hunters, they argue, the first thing you have got to do is, A, seal off the borders, deal with the border issue, and, B, enforce existing laws which prevent employers from hiring illegal immigrants.

BROWN: Well, the fact of the matter is, in many sectors, some parts of construction, some parts of agriculture, you can't get the workers.

And, in California agriculture, if you pay them the kind of living wage that would be needed for an American to support a family at our wages, the business couldn't compete. So, this is this anomaly. People come up here. They work at lower wages.

(CROSSTALK)

BLITZER: Are you comfortable about that, that people are working at -- at wages that...

BROWN: No, they should be -- I'm a very strong supporter of the farm workers.

What happened is -- and here's another problem. They only pick for a year or two. Then they go into construction. Pretty soon, they are in to other jobs. So, it is a problem. But the real answer is create some legality for the ones that are here, deal with the immediate need of workers, and then invest in Mexico.

We have to create one market, because, unless we can bring wages up in Mexico, that 10-1 differential will just be the sucking sound that draws the immigrants across the border. And no wall is going to stop that.

BLITZER: Let's talk a little bit why you're here in Washington. You were testifying up on Capitol Hill today. The last time you were here a few weeks ago, I asked you if you had any evidence that the big oil companies were price-gouging out in California.

And you -- you told me, bluntly, you didn't have that evidence.

BROWN: I don't have it. No, I don't.

BLITZER: Because I asked some of the presidential candidates in the Democratic and Republican debates this week about that.

Listen to what Senator Joe Biden said when I asked him about these big oil companies and the allegations of price-gouging. I asked him what he would do if he were president.

(BEGIN VIDEO CLIP)

SEN. JOSEPH BIDEN (D-DE), PRESIDENTIAL CANDIDATE: Investigate, as president of the United States, use the Justice Department to go in an investigate this whole issue of price-gouging.

(END VIDEO CLIP)

BLITZER: You agree with him on that?

BROWN: Well, I think it's fine for the federal government. They have got a lot of resources to investigate.

But that's not the problem. The problem is that we're importing nine -- we're importing 65 percent of our petroleum. We're using nine million barrels every day to run our cars. And our cars have not improved their fuel mileage in 20 years. There's no real commitment to alternative fuels.

Now, our land use isn't aligned with intelligent energy independence. I would rather get off, as far as we can, this oil addiction. Bush talks about it, but he's done absolutely nothing.

BLITZER: We have been hearing that since Jimmy Carter's administration.

BROWN: Since Nixon.

BLITZER: I haven't heard -- I haven't seen a lot of action, though. What's -- what's -- you were giving them hell on Capitol Hill today. What were you telling them?

BROWN: I was telling them that, number one, we are oil-dependent right there in the Middle East, all those problems in the Middle East you saw about -- just a few minutes ago.

We are never going to get out of this mess as long as we gulp all this oil down every day. So, we need alternatives. We need better cars. Bush won't stand up to the automobile companies. They're already dictating to several members of Congress a completely inefficient automobile fleet. And it's not helping the car companies. They're losing jobs.

So, I know that gas prices are painful. They're going to keep going up, at the rate we're going. So, we need fuel-efficient cars. We need biofuels substitute. And we need a different kind -- we need a different kind of transportation system. Won't happen tomorrow, but Bush is really doing his best to stall and stonewall. And that's why I was here today, saying, hey, let's get moving.

BLITZER: Jerry Brown is the attorney general of California.

Thanks for coming in.

BROWN: Thank you.

(END VIDEOTAPE)

BLITZER: We're standing by for the launch of the shuttle Atlantis. Seven astronauts will be taking off in a few hours. Four of them are now on board. These are live pictures. They are getting hooked up inside that -- that space shuttle. They will be going up in space. We will have live coverage. We're counting down.

During our 7:00 p.m. Eastern hour, you are going to see the takeoff -- Miles O'Brien standing by to help us in our coverage.

Coming up here in THE SITUATION ROOM: Will the Senate take a vote of no-confidence in Alberto Gonzales? The storm that's already brewing over the attorney general, and it's taking a new turn right now. We will talk about that in our "Strategy Session."

And, like father, like son -- the son of one presidential candidate wants to follow in his father's political footsteps. But he has a little time -- he has very little time, that is, to do it. He's fighting a war right now in Afghanistan. We will tell you what's going on.

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

(COMMERCIAL BREAK)

BLITZER: Right now, many are still reeling from severe flight delays up and down the East Coast. It appears they were caused by a computer problem.

Let's bring in Kathleen Koch. She's watching all of this.

Kathleen, what happened?

KATHLEEN KOCH, CNN CORRESPONDENT: Wolf, apparently, at some point this morning, the FAA system that handles flight plans for all of the flights throughout the country went down. And this apparently originated -- now, there you see the flights all around the country moving around, trying to get to their destinations.

But this occurred in the Atlanta area, where the FAA processes these flight plans, the origin, the destination of these flights. Now, according to a spokesperson Laura Brown, that system's back up and running. But it came up gradually around the country, in the New York area, not until 1:00 in the afternoon.

So, what's happened, Wolf, is, there's a backlog, and a lot of flights are still struggling to get back on time.

BLITZER: I just got an e-mail from someone who was supposed to take off from La Guardia at 2:00, and they are still on the ground. It's 4:30, 4:39, local time.

Where are the problems, the delays the worst?

KOCH: Wolf, you nailed it. La Guardia is the worst right now in the country, three-hour delays.

I was just told by an air traffic controller spokesperson there that they have 50 planes on the ground waiting to take off. JFK's a little bit better, but they are having 90-minute to two-hour delays -- Teterboro also pretty bad, the Philadelphia area.

And, from an FAA official who I spoke with earlier today, I heard that, in those regions, could take hours, perhaps until tomorrow morning, before things improve.

BLITZER: All right, I want you to stay on top of this story for us and check back and give us an update, Kathleen.

KOCH: Will do.

BLITZER: Thanks very much.

In California, Congressman Duncan Hunter is giving up his House seat to run for president. But Duncan Hunter may represent the district anyway. That's Duncan Duane Hunter, the congressman's son and an active-duty U.S. Marine.

But there's a hitch to his plans to fill his dad's House seat. He's being sent back to the war zone.

CNN's Thelma Gutierrez caught up with the younger Hunter in San Diego before he got word that his unit was being redeployed.

(BEGIN VIDEOTAPE)

THELMA GUTIERREZ, CNN CORRESPONDENT (voice-over): Duncan Duane Hunter isn't your average congressional candidate.

DUNCAN DUANE HUNTER (R), CALIFORNIA CONGRESSIONAL CANDIDATE: I'm running as -- you could call me the -- the right conservative wing of the Republican Party.

GUTIERREZ: He's a Marine captain who served two tours in Iraq. Just when he thought his military service was over and his political campaign was about to begin, Hunter's Marine unit was reactivated for duty overseas, bad timing for this candidate and father of three to be out of the country, and, for the candidate's wife, Margaret, who's left behind.

MARGARET HUNTER, WIFE OF DUNCAN DUANE HUNTER: I'll be out there campaigning for him, yes, standing in for him.

DUNCAN DUANE HUNTER: Ready?

UNIDENTIFIED FEMALE: Yes.

GUTIERREZ: Because of Defense Department regulations, Hunter is not allowed to campaign while on active duty, so he must quickly make his positions known on issues he feels strongly about, like the war in Iraq...

DUNCAN DUANE HUNTER: I who stay over there until -- until we can leave victoriously.

GUTIERREZ: ... and national security...

DUNCAN DUANE HUNTER: I would build the border fence to totally cut off the southern border from immigrants or terrorists.

GUTIERREZ: ... and federal spending.

DUNCAN DUANE HUNTER: National Endowment for the Arts can get cuts.

REP. DUNCAN HUNTER (R-CA), PRESIDENTIAL CANDIDATE: So, I'm making preparations to run for president in 2008.

GUTIERREZ: The name Duncan Hunter is well known in San Diego. His father has held a congressional seat here for nearly three decades. When his father decided to run for president, Hunter decided to run for his father's seat, an unfair advantage, say some.

JESS DURFEE, SAN DIEGO DEMOCRATIC PARTY: It's very obvious that he's running because he has the same name as his father.

GUTIERREZ: Not only does this husband and father now have to prepare for war overseas, but also a political battle stateside when he returns.

(on camera): Hunter says he hopes to complete his tour of duty in January. He says that will give him six months to campaign on his own before the congressional primary in June.

Thelma Gutierrez, CNN, San Diego.

(END VIDEOTAPE)

BLITZER: Duncan Duane Hunter is now serving with his unit in Afghanistan, his third tour of duty in the war zone. Good luck to him and all of the other Marines he's serving with.

Up next: The collapse of the immigration deal. What does the president do now?

(BEGIN VIDEO CLIP)

SEN. LINDSEY GRAHAM (R), SOUTH CAROLINA: The president's going to stay engaged. He's been very engaged. So, you will see the president of the United States out front saying, all right, I applaud those in the Senate who have gotten us very close. Let's get it over the line.

(END VIDEO CLIP)

BLITZER: A Bush White House priority now in critical condition. James Carville and J.C. Watts, they're standing by live to offer a prognosis in our "Strategy Session."

And later: What did President Bush take with him from the G8 Summit besides a stomach bug?

Stick around. You're in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: We're counting down to the launch of the space shuttle Atlantis. That will happen -- it's now scheduled during our 7:00 p.m. Eastern hour. These are live pictures. Seven astronauts will be on board. They're beginning to be strapped in right now.

This is a lengthy, a lengthy process that is taking place -- all systems, at least for now, go, go, go.

Miles O'Brien is there on the scene for us. We're going to be checking in with him throughout these hours, as we begin this countdown to the launch of the space shuttle Atlantis.

But let's move on right now to some other news we're following.

It's effectively dead, at least for now. But for good? The immigration reform bill that collapsed in the Senate, that top's today's "Strategy Session."

Joining us now, our CNN's political analysts. James Carville is a Democratic strategist. J.C. Watts is a former Republican congressman from Oklahoma.

I guess the bottom-line question, politically speaking, if it's dead -- and it sure looks like it's on life support right now -- what does it say about President Bush? Because, already, some of the pundits, as you know, are saying this proves he's a lame duck.

JAMES CARVILLE, CNN POLITICAL ANALYST: Well, he is a lame duck. The same thing happened to his Social Security reform thing. I mean, the president has lost two major initiatives in a row.

I don't think it changes much. I didn't think -- don't think he had very much power, if any, on the Hill before this. And he certainly doesn't have very much, if any, power after this.

BLITZER: J.C.?

J.C. WATTS, CNN POLITICAL ANALYST: I -- he's a weakened president right now.

And I think this bill surely pointed some of those -- some of that weakness out. I don't say the president's at fault, necessarily, or -- for this bill going down. But I think, had a strong president been -- been in play, he could have maybe gotten it over the -- gotten it over the hump.

BLITZER: Because, certainly, when it was introduced, this grand bargain, this compromise...

CARVILLE: Right.

BLITZER: ... a few weeks ago, you had the president strongly on board. You had his commerce secretary, Carlos Gutierrez, the homeland security secretary, Michael Chertoff.

CARVILLE: Right.

BLITZER: You had Ted Kennedy. You had John McCain.

(CROSSTALK)

BLITZER: You had Jon Kyl. You had some formidable figures...

(CROSSTALK)

BLITZER: ... in the Senate all saying, you know what, it's time to move; it may not be perfect, but this is a good deal.

Yet, it -- it -- some are suggesting what happened to the Dubai Ports World deal happened to this immigration reform deal.

CARVILLE: I think more than that is, I think a lot of Republicans wanted to vote against the president. And I think that's what happened. I think they were looking for -- you know, they didn't want to get into a situation that they were in, in '06, where, you voted with Bush 98 percent of the time.

So, they said, look, this is an easy one. This is not particularly popular in my own party, and it gives me a chance to be against Bush.

And everybody can have a varying answer. I mean, if you say, well, I might be for it, but we have got to a build a fence first, or something like that, it -- because the president was weakened, it gave these Republicans a chance to get some distance from him...

(CROSSTALK)

BLITZER: I think it's fair to say, J.C. -- and correct me if I'm wrong -- it does underscore, within the Republican Party, to be sure, the influence of the conservative radio talk shows, those -- that element of the Republican Party that simply hated this bill, because it provided some sort of pathway, not only towards legalization, but eventually towards citizenship, for these 12 million or so illegal immigrants.

WATTS: Well, we have got a weakened president, but we have got a president that hasn't been afraid to take on some big issues. But Margaret Thatcher sad, win the argument, you win the vote. The president and others who support the bill hadn't won the argument. And this shows, it underscores what happens when the grassroots is involved. And the grassroots was -- they were very engaged on this bill on both sides of the issue.

But, you know, the grassroots being involved means that this bill loses at the end of the day.

BLITZER: The right wing, if you will, they hated it. And the left wing hated certain elements of it, but I didn't get the sense they were as opposed to it, viscerally, as the right wing was.

CARVILLE: Yes. You would go to -- I would go to 50 J.J. dinners, and this would come up in three of them. If you went to 50 Republican-Lincoln dinners, it could come up in 50 of them. I mean, it was -- the intensity was there on their side. There were -- their people were -- were stoking this thing up pretty good.

WATTS: I think, Wolf, one of the strategic mistakes that was made a year ago, a year-and-a-half ago, was when the White House came out talking about guest worker -- or two years ago, when they start talking about guest-worker programs, they didn't talk about security first, or border security first.

I think that was a huge mistake, because -- and, although I said we need security at the border, we can't stop there. It has to go on and deal with the 12 million illegals within the United States.

BLITZER: Can it come back? Can it be revived?

CARVILLE: Anything can happen.

I mean, you know, one thing about Congress, it can do -- it can do anything it wants. I suspect that the president is going to take a further hit, and Congress will probably take somewhat of a hit, because people will look at this and say, hey, this is a problem. And no one can do anything.

And they are all talking at each other, and they are not talking to each other, so that it could be, when they get back home, it's not -- it could very well happen that they will say, look, we want you guys to sit down and get something done.

It's unlikely, but anything can happen.

(CROSSTALK)

BLITZER: And I think one of the problems, J.C., is that there's a huge constituency out there that hates it. There's not necessarily a huge constituency out there that loves it and believes this is the most pressing issue they face.

WATTS: Well, the problem is, Wolf, in major issues, you have to listen to hear, as opposed to listening to respond. And everybody right now, they are not listening to hear to each other. They are listening to respond to each other. And I just think, under those circumstances, nothing gets done.

BLITZER: Let's talk about Alberto Gonzales. Chuck Schumer, the Democratic senator from New York, says it's going to come up...

CARVILLE: Right.

BLITZER: ... this vote of no-confidence, on Monday in the U.S. Senate. What, if anything, does that mean?

CARVILLE: Well, I think they are going to will lose the vote. I mean, that's mainly what I hear. I could be wrong. But I think they are going to lose it. And I don't think Alberto...

(CROSSTALK)

BLITZER: So, if they're going to -- the Democrats are going to lose it, why do they bring it up?

CARVILLE: Well, because it can make the Republicans vote, and Alberto Gonzales is enormously unpopular. It's a tough vote for them.

And -- but Alberto Gonzales is never -- Bush is never going to get rid of him, because they don't want to have a confirmation hearing on a replacement, because Pat Leahy will say, we will take up your hearing when you respond to these subpoenas.

So, he's -- same reason that Peter Pace was let go, they don't -- they are very adverse to having any kind of confirmation hearing.

BLITZER: What do you think?

WATTS: Well, I think, Wolf, there's a little bit of politics at play here. And I think that's the one of the reasons that Majority Leader Reid wanted to get this immigration thing off the table. Let's get to something that we can get more on our end of the court, if you will, because he is an unpopular attorney general.

CARVILLE: Right.

WATTS: And it excites his base to say, let's vote to get rid of him.

CARVILLE: Right. I'm shocked that there's politics on the Senate floor.

BLITZER: Shocked. Shocked.

(CROSSTALK)

CARVILLE: Yes, shocked.

(LAUGHTER)

CARVILLE: There was also politics in the Justice Department, but...

(CROSSTALK)

(LAUGHTER)

CARVILLE: ... career civil servants.

(CROSSTALK)

WATTS: I agree. But, if you are going to lose the vote, why bring it up?

(CROSSTALK)

CARVILLE: Because it will make people vote.

(CROSSTALK)

BLITZER: James Carville, J.C. Watts...

WATTS: But that's my point.

(CROSSTALK)

BLITZER: ... our political analysts, part of the best political team on television.

(CROSSTALK)

(LAUGHTER)

BLITZER: Guys, thanks very much.

Still to come: another shakeup among military advisers to President Bush. The Joints Chief chairman, Peter Pace, will not -- repeat, not -- be asked to stay in his job. You will hear the defense secretary, Robert Gates' explanation.

And one congressman says the Bush administration's behavior on one controversial program -- program -- is -- and I'm quoting now -- worse than Watergate. Jack Cafferty wants to know what you think.

Jack and your e-mail -- when we come back.

(COMMERCIAL BREAK)

BLITZER: Here's a look at some of the "Hot Shots."

In Germany, a military working dog leaps toward its handler at a U.S. Air Force base.

In Nairobi, Kenya, a boy helps lift a bag of food onto another boy's back, as they flee a slum in the wake of a violence police crackdown.

In Bangkok, Thailand, a mother and her child join in on a demonstration for the return of democracy.

And, in Osaka, Japan, a university children shakes hand with a child robot that can change facial expressions -- some of this hour's "Hot Shots," pictures often worth 1,000 words.

Let's go to our "Political Radar" this Friday: a new guilty plea today in connection with disgraced lobbyist Jack Abramoff. The former head of a Republican environmental advocacy group has agreed to cooperate with prosecutors in the Abramoff probe. Italia Federici pleaded guilty to tax evasion and obstructing a Senate probe into the Abramoff lobbying scandal. She will be sentenced in November.

There's word today that the Bush White House has expanded its legal team to handle the fights it's having with the new Democratic Congress. The White House counsel, Fred Fielding, has created five new jobs in his office since becoming the president's top lawyer back in February.

Dallas could become the nation's largest city to elect an openly gay mayor. That's if the longtime City Council Member Ed Oakley wins a nonpartisan runoff election later this month against businessman Tom Leppert.

Oakley's candidacy is seen as a new indication that Dallas' reputation as a conservative stronghold is giving way to more diversity. In town hall meetings and debates, Oakley's sexual orientation has seemed to be a nonissue with voters.

Remember, for the latest political news at any time, check out our Political Ticker, CNN.com/Ticker.

Let's go back to Jack in New York -- Jack.

JACK CAFFERTY, CNN ANCHOR: Congressman Jerry Nadler says, the actions of the Bush administration when it comes to the warrantless NSA wiretapping program are -- quote -- "worse than Watergate."

Is he right?

Bruno in Los Angeles: "The NSA wiretapping is much worse than Watergate. Think about it. The covert departments of our own government are spying on American citizens. In conjunction with the eradication of habeas corpus, the wiretapping pretty much stripped us of our Constitution and all the rights to privacy and due process that our Constitution provides every citizen. My goodness, without that, what have we got left?"

Doug in Buffalo: "Yes, the NSA wiretapping is worse than Watergate. But it's only the tip of the iceberg. Keep digging and flush it all to the surface. President Bush and crowd all need to be brought to justice, if there's any left."

Wade writes: "On just the NSA thing, it's worse than Watergate. But, when you factor it into the overall crime spree these guys have been on since they crashed into the White House, the Watergate comparison is like comparing Grenada to World War III." Jay in Green Bay: "Of course it's worse than Watergate. But, with the advances in technology and creativity of homegrown and international terrorists, it might be necessary."

Dan in Tennessee: "Jack, if you only knew how long I have waited for this question to be asked. The Bush administration has dragged the honor of America and Americans through the mud and slime of the most egregious lies that have ever been told. Next to the Bush presidency, the Nixon administration looks like a church choir. Thank you so much."

Nora writes: "He's right. So, tell me, why is impeachment off the table?"

And, "Jack, as a loyal CNN viewer, I'm concerned I may not be getting enough coverage of the Paris Hilton most vital saga on the planet. Could you use your influence to get THE SITUATION ROOM broadcast from her jail cell all of next week? You can break away from important coverage whenever she says something that makes sense. Pining for Paris in California," signed "Ray."

What do you think about that, Wolf, put you in...

(LAUGHTER)

CAFFERTY: ... put in the cell with Paris and do THE SIT ROOM next week?

(CROSSTALK)

BLITZER: No, but I wouldn't mind going to Paris -- Paris, France, that is, if we have got a legitimate reason to go there.

Thanks very much, Jack, for that.

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