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Crisis in Gaza Escalates; Will Bush Pardon Scooter Libby?

Aired June 14, 2007 - 19:00   ET


WOLF BLITZER, CNN ANCHOR: Thanks very much, Lou.
Happening now, crisis in Gaza. Islamic fighters taking control. Tonight, there are growing fears the Middle East is in meltdown.

Plus, the vice president's former right hand man ordered to prison without delay. The bombshell ruling against Lewis Scooter Libby is putting new pressure on President Bush to pardon him.

And Princess Diana's sons open up about the mother they loved and lost. Tonight, the first clips of an interview with Prince William and Prince Harry.

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

The Middle East powder keg exploding in Iraq, Lebanon and tonight in Gaza. Hamas fighters are now claiming full Islamic control of security and the presidential compound after days of very bloody battles. CNN's Atika Shubert is following this unfolding crisis from Jerusalem. Atika?

ATIKA SHUBERT, CNN CORRESPONDENT: Wolf, Gaza is descending further into chaos as Palestinian President Mahmoud Abbas declares a state of emergency and dissolves the government. Israel is watching with increasing trepidation, worried that it will be drawn into the violence one way or another.


SHUBERT (voice-over): Hamas TV showing Fatah forces marched out onto the streets of Gaza at gun point. The Islamic militant group's radio station trumpeted victory, declaring "This is the beginning of Islamic rule in Gaza. The first step to establishing an Islamic state." For Israel, this is a nightmare.

EPHRAIM SNEH, ISRAELI DEPUTY DEFENSE MINISTER: The danger is that Hamas will take over Gaza to a kingdom of thugs, murders, terrorists, poverty and despair.

SHUBERT: Israel watches the chaos in Gaza with despair. But what can it do? Not much, say Israeli analysts.

HIRSH GOODMAN, NATL INST FOR SECURITY STUDIES: I think the worse thing they could do is get involved in the Palestinian conflict. If they fire at Israel, we have to fire back. If they are fighting each other, that is really not our issue. SHUBERT: Israeli troops left Gaza in 2005, and there is no desire or political now to occupy the area again. But there is also fear that Gaza is a safe haven for Iran-backed militants to launch attacks on Israel.

GOODMAN: They have armed Hezbollah in the north, they are going to arm Gaza with long-range rockets. Together, they've got Israel in a situation. The establishment of the axis of evil in Gaza, and holding a population of 1.5 million people hostage.

SHUBERT: Israel is caught in a bind, and not just because of security. Israel also controls the gateways in and out of Gaza. Without these, supplies to almost a million and a half people will be shut off. Opening them may require dealing with Hamas on the other side.


SHUBERT: Israel cannot stand and do nothing. But it also does not want to become involved in what is quickly becoming a civil war. But the longer the fighting goes on, the less options Israel has. Wolf?

BLITZER: Atika Shubert watching this situation unfold. Let's take a closer look at the bitter rivals in this bloody conflict. Yasser Arafat's Fatah Party was the main PLO faction. It became the Palestinians' ruling party after an agreement with Israel brought Arafat back to Gaza in 1994.

After Arafat's death, Mahmoud Abbas became party leader, and Palestinian Authority president. The militant Islamic Hamas party won control of the Palestinian government in the elections of January 2006.

Ismail Haniya of Hamas became prime minister. Viewing Hamas as a terrorist organization, Israel, the U.S. and the European Union began a boycott.

This March, Abbas and Haniya formed a unity government, but power sharing proved impossible and factional fighting has raged on. Now, there is a total security collapse with Hamas claiming control in Gaza and threatening Islamic rule.

Let's track the situation right now in Iraq. The Pentagon is out with its latest progress report, along with some promising developments, there are deeply troubling developments as well. Let's get the latest from our senior Pentagon correspondent Jamie McIntyre. You are reading, Jamie, between the fine print. And what do you conclude?

JAMIE MCINTYRE, CNN SR. PENTAGON CORRESPONDENT: Well, Wolf, you can find a lot of things in this report that are going right in Iraq, but there's no way to sugarcoat it. There is a lot going wrong.

(BEGIN VIDEOTAPE) MCINTYRE (voice over): Anyone looking for evidence the so-called surge is working, won't find it in the latest Pentagon report on security and stability in Iraq. The congressionally-mandated status report tries to accentuate the positive, but notes the aggregate level of violence in Iraq is unchanged.

Insurgents and al Qaeda militants have simply shifted locations. So while violence is down in central Baghdad and Anbar province, it's up almost everywhere else, especially in Diyala, Ninewa and outlying areas of Baghdad.

The report recovers from February to mid May, and its conclusion echoes what U.S. commanders say -- it's too soon to tell if the new strategy is working, considering the last brigade of additional U.S. troops has just arrived.

MAJ. GEN. JOSEPH FIL, U.S. ARMY: The fifth and final of this surge, and it's been very, very helpful for us here in Baghdad to have the increased troop strength, because it allows us to get into every part of the city.

MCINTYRE: But so far, most trends are not good. The report details the ability of insurgents to block crucial economic progress with attacks on infrastructure. Oil production is stuck at last year's level of two million barrels a day, while electricity generation remains at pre-war levels, roughly 4,000 megawatts, enough to give Baghdad residents only eight hours of power a day.

And now insurgents are targeting bridges, attacking three in the past week.

FIL: Any time a bridge is attacked and damaged over here, it is a very serious concern for us. They attack the infrastructure of the nation and they create a huge inconvenience for the population of Iraq.


MCINTYRE: The report also notes that Iraqi politicians are making little progress toward reconciliation, which, after all, Wolf, is the underlying goal of this U.S. military crackdown. All of this points to the increasing likelihood that in September, when General David Petraeus issues his first report card, he will be under a lot of pressure to ask for more time to give this strategy more time to work -- Wolf.

BLITZER: Are you hearing in the corridors over there at the Pentagon, a lot of confidence that the Iraqi government, of Prime Minister Nouri al-Maliki eventually will step up to the plate and get the job done?

MCINTYRE: No. No, you're not hearing that at all. In fact, there's a lot of pessimism about that, and about a lot of the indicators. And what a lot of people here privately believe is that the strategy employed now could work over an extended period of time a couple of years, perhaps, but they know they don't have a couple of years. They only have a few months.

BLITZER: Jamie McIntyre at the Pentagon reporting for us, thank you.

Meanwhile, inside Iraq, there are fears of even greater sectarian violence following the bombing of an important Shiite shrine in Samarra. Curfews are now in effect in many regions throughout the country, and appeals for calm are coming in from around the world. Our own Karl Penhaul is with U.S. troops near that devastated holy site. Karl?

KARL PENHAUL, CNN CORRESPONDENT: Wolf, we're at a U.S. army combat outpost on the edge of Samarra. About a half a mile that way are the ruins of The Golden Mosque.

We joined a U.S. army patrol today to go and survey the damage.

The whole site seems to be a wreck of smashed concrete and twisted steel. You can still make out some of the glints of gold which used to coat the twin minarets that were bombed on Wednesday, but, also, The Golden Dome, that was bombed backed in February, 2006, that threatened to fan the flames of a simmering civil war.

So far, the streets in Samarra have remained calm. But there has been a sectarian backlash across Iraq. There have been bombings of Sunni mosques in Baghdad and in the south of Iraq. There have also sectarian gun fights reported-- Wolf.

BLITZER: Karl Penhaul watching this for us - Karl, thanks very much. Be careful.

Jack Cafferty is joining us now from New York. You know, Jack, there's a lot of fear out there, that the other shoe is going to drop that the Shia now are outraged over the destruction of their holy mosque, they are going to go after the Iraqi Sunnis in a major way, specifically Iraqi Sunni mosques.

JACK CAFFERTY, CNN ANCHOR: Well, I can't imagine the Shia are too thrilled to find out that we are apparently arming some of the Sunnis either, can you?

BLITZER: We are in the Anbar Province, because they are promising to go after al Qaeda.

CAFFERTY: Right. Wolf, when it was time for the Senate Majority Leader Harry Reid to face down President Bush at high noon over the war in Iraq, Reid not only blinked, he turned and ducked down a side street.

The president vetoed the war funding bill with the timelines and Reid and the Democrats couldn't cave in fast enough. The midterm elections last year were a referendum on the war. The Democrats won.

But so far, they haven't done anything to bring the war to an end. On the contrary, they handed President Bush another blank check for almost $100 billion so this tragedy can go on awhile longer. Well, guess what? A lot of people in this country apparently are not happy about that, and also apparently in an effort to deflect the growing criticism that he's getting from constituents , Senator Harry Reid has now take on the calling some of the nation's military leaders names. reports that in a meeting with a group of liberal bloggers, Reid called General Peter Pace, the outgoing chairman of the joint chiefs of staff, incompetent.

And according to "Politico," he also made similar disparaging remarks about Army General David Petraeus, the top U.S. commander in Iraq, although a senior Democratic aide told CNN today that part of the story is not true.

Note to Senator Reid. Congress controls the purse strings. Cut off the funding, the war will end. Calling America's top generals names will not end the war.

Here's the question: How productive is it for Senator Harry Reid to be belittling the nation's top military men?

E-mail or go to


BLITZER: Thank you, Jack for that. Jack will be back shortly.

Coming up, a tentative, emphasize the world tentative, agreement to revive immigration reform in the Senate. What led to an apparently breakthrough? And will this deal actually survive?

Plus, a new kind of hurricane threat, from forecasting technology that's less accurate.

And he's campaigning for presidential votes, but now Senator Barack Obama is getting some online attention he may not necessarily want. Stay with us, you're in THE SITUATION ROOM.


BLITZER: We're getting a late breaking development, word of a compromise, potentially, at least, on Capitol Hill that may breathe new life into the controversial immigration reform bill. Only moments ago, key Republican and Democratic senators wrapped up a meeting to try to hammer out some final details. Our congressional correspondent Dana bash is working this story for us. What are they saying?

DANA BASH, CNN CONGRESSIONAL CORRESPONDENT: Well, we have news now, Wolf, and that is, according to a couple of sources who were in that meeting, and that is they have now agreed on a way to bring the Senate immigration bill back to the Senate floor.

Unclear when it is going to happen, but what happened just a few minutes ago, is there was a meeting among Democratic and Republican leaders trying to figure out if they can actually revive the immigration bill, which stalled just last week.

People thought the fate of it was really not very good. But all week long, negotiators have been behind closed doors, trying to bring it back to life, and at this hour, we understand that it probably will be brought back to life.

We are waiting, Wolf, for a final statement, a formal statement from the Democratic leader, and the Republican leader. We expect to get that momentarily, but the headline here is that just moments ago, senators came out of a closed door meeting, a high-level meeting and they agreed inside those closed doors to bring the Senate immigration bill back to life.

BLITZER: And the president came forward today with billions of dollars, he says, to beef up border security between the United States and Mexico. Was that instrumental in shaping this potential deal? Go ahead.

BASH: Unclear if it was instrumental, but it definitely greased the wheels, I can tell you that in talking to several Republicans here who were kind of on the fence about whether or not this was really going to be something that they could go for, because the conservative base, of course, has been so vocally against this, and what they said is that that kind of goodwill gesture from the president really helped.

Why? Because what people are hearing mostly from the folks back home is they that don't really think the government means it when they say they are going to secure the border. And essentially what the president helped them do is show their constituents that the government is willing to put their money where they mouth is, so to speak, on border security.

BLITZER: All right, Dana, as soon as you hear the final word, when this vote is expected, when the debate will come back to the Senate floor, let us know, and we'll get it on the air. As soon as you know, we'll know, as well. Thank you, Dana.

He may be dropping in the polls, but president bush can still help Republicans rake it in when it comes to campaign cash. Or can he? Let's go to CNN's Mary Snow, she's watching this story for us. Has the president, Mary, lost his touch?

MARY SNOW, CNN CORRESPONDENT: Wolf, President Bush did headline a dinner of Republican heavyweights last night, but he did not score a fund raising knockout.


GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: We have a goal, and that is to retake the House, retake the Senate, and keep the White House in 2008.


M. SNOW: President Bush helped to raise more than $15 million to support Republican congressional candidates Wednesday night. While that's a good chunk of change, it's a lot less than the $27 million raked in at the same event the president headlined last year.

The dinner came as the president's approval sank to an all-time low in a new "Wall Street Journal"/NBC survey. Mr. Bush fares little better in our poll of polls. CNN took the president's approval ratings from the six most recent national polls, and the average comes to 32 percent.

But Mr. Bush is still popular among his party's faithful.

KEATING HOLLAND, CNN POLLING DIRECTOR: Even though most Americans don't approve of him, he still has very high approval among Republicans. That's the audience that he's trying to raise money from. That's the audience that's giving him money.

M. SNOW: While he's still the man in demand to rake in campaign cash, will he be welcome and effective on the campaign trail?

HOLLAND: The redder the state, the greater the likelihood that a Bush campaign appearance is going to help a Republican candidate.

M. SNOW: Alabama is such a state. Senator Jeff Sessions is dead- set against the president when it comes to the battle over immigration reform.

SEN. JEFF SESSIONS (R-AL), ARMED SERVICES COMMITTEE: I think the president is wrong to push this piece of legislation so hard, after we have demonstrated the flaws that are in it.

M. SNOW: But Sessions, who faces reelection next year, welcomes the president out on the trail.

SESSION: He's coming to Alabama to me next week to campaign for me. And he made clear he was going to do that.


SNOW: Despite the dramatic drop in the president's take at last night's dinner, Republicans say they are still pleased. But Democrats say it's a sign the president can't raise cash the way he used to. Wolf?

BLITZER: Mary Snow reporting for us. Thank you, Mary.

Still ahead here in THE SITUATION ROOM, Lewis Scooter Libby denied a delay from his prison sentence. How soon could President Bush pardon him if he wanted to?

And Angelina Jolie leads a charmed life. Is she optimistic about changing the world? The actress and activist shared her hopes. That's coming up next. We'll be right back.


BLITZER: It was five years ago that "Wall Street Journal" reporter Daniel Pearl was killed in Pakistan. Now the movie that dramatizes the brutal the murder and the ordeal of his pregnant wife is about to hit the big screen. Angelina Jolie plays Marion Pearl. And she talked with our own Larry King about the role, and her work as a special U.N. ambassador. Listen to this clip.


LARRY KING, CNN ANCHOR: As the world goes on and you view it, are you less optimistic?

ANGELINA JOLIE, ACTRESS: No, I'm optimistic, but I think a lot of big changes need to be made. I don't want to have to keep going to refugee areas. I don't want to have to send people back to their home where it is not secure and have to see them five years later because it exploded again into violence because we did not have proper justice. I don't want to do that. And I think it is time that we can handle that better as an international community.


BLITZER: And you can see the full interview with Larry and Angelina Jolie, her role as a wife caught in a tragic tale of terror. She talks to Larry about her new film "A Mighty Heart" and a lot more. All the special work she's doing for the United Nations. Angelina Jolie joins Larry King tonight, 9 p.m. Eastern.

From Angelina Jolie to Carol Costello, she's monitoring stories incoming to THE SITUATION ROOM right now. Hi, Carol.

CAROL COSTELLO, CNN CORRESPONDENT: Hi, Wolf. We start with a sad story. The wife of evangelist Billy Graham has died. Ruth Bell Graham was 87. She had been treated for pneumonia. She slipped into a coma on Wednesday and she died at her home in the North Carolina mountains with her husband and her five children by her side. In a statement, Billy Graham calls Ruth "his life partner," adding "No one else could have born the load that she carried."

The Atlanta lawyer who created an international TB scare is scheduled to undergo surgery next month. Andrew Speaker will have an operation in July to remove a chunk of lung issue. It's the size of a tennis ball. Speaker is infected with what's known as an extensively drug resistant kind of tuberculosis. The surgery will be done at the University of Colorado Hospital.

Gay marriage stays legal in Massachusetts. Lawmakers in the Bay State blocked a proposed constitutional amendment that would have let voters decide to ban same sex unions. Massachusetts is the only state to allow gay marriage, following a historic 2003 state court ruling. More than 8,500 same sex couples have been married in the state since then.

Six men accused of plotting attacks on soldiers in New Jersey's Fort Dix all pleaded not guilty in federal court today. The judge set a tentative trial date of August 13th. Investigators say they learned of the alleged plot when the men asked a store clerk to transfer a video onto a DVD. That video was of the men firing weapons and screaming about jihad. That's a look at what's happening now, Wolf.

BLITZER: Thanks Carol, for that. We're going to check back with you shortly.

Just ahead, an important day, a very important day in court for Lewis Scooter Libby. Despite his wishes, he's on the fast track to jail. But will President Bush step in with a pardon? Our senior legal analyst Jeff Toobin standing by for that.

And space shuttle astronauts and engineers on Earth are working feverishly right now to try to fix a huge technical problem on the international space station. If they don't succeed, the space station might, repeat, might have to be abandoned. We're going to have an update. Stay with us. You're in THE SITUATION ROOM.


BLITZER: To our viewers, you're in THE SITUATION ROOM.

Happening now -- the Defense Secretary Robert Gates says the U.S. will proceed with plans for a missile defense system in Eastern Europe, despite fierce opposition from Russia's President Vladimir Putin. Gates also says he doubts any deal can be struck when President Bush meets with Mr. Putin in Maine early next month.

The head of the International Atomic Energy Agency says it would be an act of madness to launch an attack on Iran over its refusal to freeze nuclear problems. But the IAEA chief Mohamed ElBaradei say Iran is close to the start of a large-scale problem. He calls on Iran to voluntarily suspend it.

The family of the Virginia Tech student gunman Seung Hui-Cho has cleared the way for release of his mental health records. The school also let the news media tour Norris Hall. It's been locked down since Cho killed 32 people in May.

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

Just hours ago, a federal judge ruled that the former Cheney aide Lewis Scooter Libby must - repeat must -- begin serving a two and a half year prison sentence, even while he appeals his perjury conviction. Brian Todd is joining us over at the Federal Courthouse here in Washington. So, Brian, what happens now?

BRIAN TODD, CNN CORRESPONDENT: Well, Wolf, a short time ago, "Scooter" Libby was processed for voluntary surrender to the prison system, capping a day when his attorneys could not sway a very resolute judge.


TODD (voice-over): The vice president's former aide stoically departs U.S. district Court, knowing he could find himself behind bars within weeks. Judge Reggie Walton says: "This is a significant issue. We're talking about someone's freedom." But sternly holds that the appeal strategy from "Scooter" Libby's defense team is not strong enough to allow Libby to remain free during the appeal.

RICHARD SMITH, FORMER FEDERAL PROSECUTOR: A lot of these rulings deal with evidentiary rulings, which goes to the abuse of discretion by the trial judge. Appellate courts are very reluctant to overrule evidentiary rulings that a trial judge makes.

TODD: Among the appeals arguments expected from Libby's team, the judge should have allowed a memory expert to examine Libby's claim that he didn't remember key details on who outed CIA Officer Valerie Plame Wilson. But Libby's attorneys are hitting hardest on prosecutor Patrick Fitzgerald, arguing Fitzgerald had way to much authority in the investigation, more than any special counsel.

Defense lawyer Lawrence Robbins, at one point, gesturing toward Fitzgerald, saying, he thinks he's the attorney general, and given the terms of his agreement, I don't blame him. Judge Walton doesn't buy it. Says it can be argued on appeal, but shouldn't prevent Libby from beginning his sentence in two and a half year sentence within two months.

Now, conservatives who believe this trial was a political witch hunt will turn up the pressure on President Bush to pardon Libby, a move that observers say has its own risk.

JIM VANDEHEI, POLITICO.COM: It would be very difficult for a president whose popularity is already so low to pardon someone who is convicted lying, and not lying once or twice, but repeatedly in a very important federal investigation.


TODD: Now, on that front, President Bush was very quick to be noncommittal about what he will do, just moments after this decision was rendered today. The president issued a statement through his Deputy Press Secretary Dana Perino, saying, quote, "Scooter Libby has the right to appeal and therefore the president will continue not to intervene in the judicial process. The president feels terribly for Scooter, his wife, and their young children, and all that they are going through."

So, the president, keeping his cards pretty close to the vest on a possible pardon, Wolf.

BLITZER: At the top of this hearing today the presiding judge made a stunning revelation, Brian. Tell our viewers what he said.

TODD: Very beginning of the hearing today, Wolf, he said, under full disclosure, I have to tell you all something. He said he has received a number of harassing, threatening phone calls and letters based on his sentencing of Scooter Libby. Some of them, said, quote, "were wishing bad things on me and my family". A lot of external things for the judge to think about. But he was very clear, that would not affect his ruling.

BLITZER: Brian Todd, over at the Federal Courthouse. Thanks, Brian, very much. If President Bush decides to pardon Scooter Libby, how quickly could he do it? I asked CNN's Senior Legal Analyst Jeff Toobin.


JEFFREY TOOBIN, CNN SR. LEGAL ANALYST: The pardon power is one of the few absolute powers that the president has. He can pardon someone before they are indicted. Gerald Ford pardoned Richard Nixon before he was criminally charged with anything.

You can be pardoned long after you've served your sentence, like Ronald Reagan pardoned George Steinbrenner years after that case was over. So, the pardon power is absolute, it can't be appealed, it can't be overturned. And President Bush has to decide whether he's going to exercise it for a very close former aide.

BLITZER: President's issue pardons at the end of a term, or whatever, that's when Bill Clinton did it, when this president, at the end of the year, they can do it. But normally, isn't there some sort of pardon review process that goes on in the Justice Department that makes recommendations?

TOOBIN: Absolutely. There's a whole pardon office, within the Justice Department that has very strict rules about when they will recommend a pardon to the president. They say, for example, that you can't even apply for a pardon until five years after you've completed your sentence. That would obviously preclude President Bush from getting involved in the Scooter Libby case at all.

However, those rules are not binding on the president. The president can pardon anyone he wants. Those rules are meant for people who are applying in the normal process. But when President Clinton pardoned Mark Rich, and his other controversial pardons, he didn't listen to the pardon office. Presidents have absolute authority in this.

BLITZER: What about something short of a pardon, suspending the sentence, shortening the sentence, deciding he doesn't agree with the judge, and allowing Scooter Libby, for example, to stay out on bail while his appeals process goes forward. Could the president, if he wanted to, undertake those kinds of steps?

TOOBIN: I have to say, maybe there are constitutional experts out there who will contradict me, but I don't think the president has that authority. I think it's an all or nothing proposition. He can pardon Scooter Libby, and end the case against him today, But other than that, he has no authority, as I understand it, to get involved in the process at all.

BLITZER: Here is what the outgoing counselor to the president, Dan Bartlett, told our John King, just a little while ago. I want to play this clip from an interview that John had.


DAN BARTLETT, COUNSELOR TO THE PRESIDENT: As long as there is an appeals process, he is still outside of the custody of the criminal justice system. My understanding it will be sometime before that would actually take place, and in the meantime, there an appeals process, an emergency appeals process, that is being filed.


BLITZER: All right. So, he was noncommittal. Much more of that interview, by the way, coming up later tonight on "AC 360". But tell us what you walk away from, hearing what Dan Bartlett just said.

TOOBIN: Well, Wolf, he actually said two very different things. He says there is an appeals process underway, and that appeals process will continue whether Scooter Libby is in jail, or not. So, if that's the rule, then President Bush will let Scooter Libby begin serving his sentence and wait until the appeal plays out.

But the other thing Dan Bartlett said was, he's not in custody yet, which would suggest that that would be the moment when President Bush gets involved.

Clearly, I think, there is a struggle going on at the White House. There are lots of people in the White House who care about Scooter Libby a great deal, who respect him, admire him, like him, feel sympathy for him. They will be pushing the president to grant a pardon.

Other people will recognize this would be a terribly unpopular political act, pardons are almost never popular, especially in a politically charged situation like that. This is one of those decisions where the president simply has to make up his own mind.

There's really -- there's no process here. This is just the president and his conscience, and I don't think we know what President Bush is going to do here yet, and I don't think he probably knows at this point.

BLITZER: The pressure is going to be mounting. He has six or eight weeks to make a decision. And we know that conservatives out there on "The Wall Street Journal" Editorial Page, "The Weekly Standard" editorial writers, the "National Review" editorial writers, they are leaning very hard on this White House to issue that pardon. We'll see if he does it.

TOOBIN: But there is one possibility that could take President Bush off the hook. The Court of Appeals for the D.C. Circuit, they could -- it would be very unusual -- but a lot of stuff is unusual in this case -- the Court of Appeals could step in and say, we think the issue is important enough that he deserves bail pending appeal.

So the court of appeals could get involved. They usually don't, but it's another reason to stay tuned during this six to eight weeks.

BLITZER: All right, Jeff, thanks very much. Jeff Toobin, our senior legal analyst.

And still ahead tonight, a computer that controls the oxygen supply on the International Space Station has been having some serious trouble. You're looking at live pictures right now. So, what happens if it can't be fixed? We'll going to tell you about the worst-case scenario.

And National Weather Center meteorologists say a crucial hurricane warning satellite could fail, literally, at any time. Will forecasters will able to make the right call without it? We'll have a report. Stay with us. You're in THE SITUATION ROOM.


BLITZER: There's a problem in space right now. Crews aloft and engineers on Earth are trying to get computers back up and running on the International Space Station. You are looking at live pictures right now behind me.

Russian computers controlling a number of functions, including oxygen and water supplies, failed yesterday. They came back on briefly when they were rebooted earlier today, but they're offline once again, this time on purpose.

It's happening while the Shuttle Atlantis remained docked to the orbiting lab, where 56 days worth of oxygen remain. Worst-case scenario, the space station's three crew members would have to return to Earth, if the computers aren't fixed. There is an escape ship for that. It's a Russian Soyuz capsule.

This is an important story, we are watching it very, very closely.

Let's move on now to another important story we're watching. Improvements in predicting the path of hurricanes are credited with saving thousands of lives. But right now, hurricane forecasting technology may be about to get a little bit less accurate, and we're in the middle of hurricane season, it's just started, actually.

That would mean a lot more taker for people living along America's coastlines. Let's bring in our Meteorologist Chad Myers; he's watching this story for us.

I hear these reports that this satellite, which has been so important in forecasting hurricanes could be going down. What does it mean for all of us?

CHAD MYERS, CNN METEOROLOGIST: Wolf, it just means that it's old. It was made to live for three years, and that was in 1999. Well, it's still alive. It is still running. It lost its main transmitter. It is running on a backup transmitter. It is still giving us all the data we want. It looks at the ocean. It looks at what the wind speeds are, without having to go down there and put a buoy down there, or a boat. It can literally measure the winds from aloft.

The problem is, it's old. The Hurricane Center says, when it dies the forecasts are going to suffer, and there are no plans to replace it any time soon.


UNIDENTIFIED MALE: And we have liftoff.

MYERS (voice over): The QuikSCAT Weather Satellite was launched in 1999. With it's rotating antennae, it sweeps the world's oceans and takes 400,000 wind measurements every day. The system is one of several used by the National Hurricane Center in forecasting hurricanes. But QuikSCAT is five years past its life expectancy. The aging weather satellite could fail at any moment.

REP. RON KLIEN (D), FLORIDA: I'm very concerned that a satellite that provides a lot of our major information for our weather forecasters at the National Hurricane Center, as we have found out just recently, is beyond its useful life. Which means that it may last a week, it may last a month, it may last a year, but my question of course, is how do we get to this point, and what is plan B?

MYERS: The National Weather Service plans to spend about $20 billion during the next 20 years on the next generation of technology. In the meantime, acting director Mary Glackin says there's no reason to worry.

MARY GLACKIN, ACTING DIR., NAT'L. WEATHER SERVICE: I'd really like to reinforce to American public that we are prepared to provide hurricane services this season. We have, again, our geo-stationary satellites up there watching those storms all the time. We have our Hurricane Hunter Aircraft. We put new buoys in the water to be able to figure out what's going on at that level. We are ready.


MYERS: This is not a major issue when it comes to the overall scheme. If this thing goes down tomorrow, we're not going to be, like, blind, OK? We will lose, according to the Hurricane Center, 10 percent prediction ability. So, the average error, Wolf, at about 48 hours is about 150 miles. That will be 10 percent bigger, so, 165 miles for the error.

Now, how do they know that? Well, they went back to 2003, and they took all of the computer models and all the hurricanes, and they ran the models without QuikSCAT in it, and they found that the models were about 10 percent less accurate without this model in there.

To be honest, there are other satellites that are going to try to do the same thing. Going to try to take up where this one leaves off, but not anyone of them can do it as good as this Quick Scat.

Remember, 13 to 17 named storms. We've already had two. Seven to nine hurricanes, and three to five major hurricanes expected, that's Category 3, 4 or 5 -- Wolf.

BLITZER: Let's hope this satellite survives this current hurricane season. Thank you, Chad. Good report.

Up ahead, in the 10 years since Princess Diana died, we have heard a great deal about both her public and private lives. But what kind of mother was she? Her sons, her two sons are now speaking out. You are going to hear what they have to say.

Also, the Senate Majority Leader Harry Reid, reportedly made some disparaging remarks about some of the military's top generals. Was he out of line? Jack Cafferty with your e-mail. All of that, coming up right here in THE SITUATION ROOM.


BLITZER: In the decade since her death, Princess Diana has been remembered and analyzed by people around the world. Now, her two sons are speaking out about the glamorous and tragic figure they knew as Mom. Carol Costello is joining us once again.

It is rare that we hear from Prince Harry and Prince William. What are the two princes now saying?

CAROL COSTELLO, CNN NEWS ANCHOR: They want to spread the word that their mom was a great person. You know, Wolf, there has been a resurgence in interest in everything Diana. Tina Brown has a new book out, and it explores the good and the bad about the princess. So on the 10th anniversary of her death her sons are fighting back with a pop concert. They are afraid that Diana's memory is being sullied. They want the world to know she followed her conscience and was a fabulous mother.


PRINCE WILLIAM, UNITED KINGDOM: Because she did everything, because she felt it was right, and that it was what she wanted to do. She didn't go by what she thought was the best thing to do or be told to do something. She did it from her heart, and fully immersed herself into it.

And she cared, she cared massively. We were left with no doubt at all that we were the most important thing in her life. And after that, it was everyone else. It was all her charities and everyone else. And to me that's a really good philosophy that she just -- she loved, caring for people and she loved helping.


COSTELLO: The concert will take place July 1st in Britain and will feature Duran Duran, Elton John, Rod Stewart and Tom Jones. Princess Diana's sons say their mom would have loved this tribute, because she loved to dance to pop music.

PRINCE HARRY, UNITED KINGDOM: She had her public side and her private side. And the private side was very small in comparison to the public side, obviously, but the memories that we've got of her -- I mean, we are very lucky to have those memories, because they're so private, between us. And that's the nicest thing about it. You see her get slated for such and such, but the personal memories that we have of her are very much private, and that's the way, hopefully, it will always be.

(END VIDEO CLIP) COSTELLO: He hopes so, but privacy is something these young men will probably never really have. By the way, Princess Diana would have been 46 years old, had she not died in that Paris car crash. Her little boys are now 24 and 22.

BLITZER: All right, Carol, thanks very much.

Let's check back with Jack Cafferty. He's got "The Cafferty File"


CAFFERTY: Question this hour, how productive is it for Senator Harry Reid to be belittling the nation's top military men?

Rich in St. Augustine, Florida, "Jack, apparently Reid doesn't care. Not only is he belittling our generals he's also belittling the American citizen with his amnesty agenda. Harry Reid should pack his bags and leave D.C. along with Bush, Cheney, and Pelosi."

Joe in California, "I'm not sure it's counterproductive for Mr. Reid to be belittling Generals Petraeus, et cetera, but at the same time it accomplishes nothing. Kinda like Senator Reid."

Larry in Texas writes, "Harry spoke but the truth. Tony Snow called it slander. But the truth is not slander, and the truth, if considered belittling is still truth."

Craig in Iowa, "Jack, last I remembered, Generals Pace and Petraeus were not the jackasses who sent our fine young men off to war. No, Sir, it was our gallant fighting men and women on Capitol Hill who sent our kids, without adequate armor, into hell's kitchen with a plan concocted by draft dodgers like Mr. Cheney, and obsequiously supported by our stalwart political leaders, and nearly every current presidential wannabe."


Paul in Massachusetts, "It's about time that the competence of our military commanders is being questioned. They have allowed equally incompetent politicos, (i.e., Bremer) to destroy any chance of quickly subduing the insurgents in Iraq."

And Terry in Phoenix writes, "Jack, the only thing Senator Harry Reid is going to be able to take credit for is giving control of the U.S. Senate back to the Republicans!"

IF you didn't see you e-mail here, you can go to, we post more of them online, along with video clips of "The Cafferty File".

Love those video clips. Thanks, Jack, very much. See you tomorrow.

Let's check in with Paula to see what's coming up at the top of the hour -- Paula.


A mother's story you've got to see. It will remind you of the movie "Saving Private Ryan". The Army is sending four of her sons to Iraq, almost at the same time. Is that really allowed?

We'll also ride along in the desperate search for a missing woman. This case raises some very disturbing questions. That's all coming up at the top of the hour. And the latest on what's going on in Capitol Hill. In regards to immigration, as well.

BLITZER: Thank you, Paula. We'll be seeing you in a few moments.

Still ahead here in THE SITUATION ROOM, Senator Barack Obama may be a front-running Democratic candidate for president, but he's also becoming a bit of an online cult figure. Our own Jeanne Moos will show us a most unusual video. That's coming up, right here in THE SITUATION ROOM.


BLITZER: You never know what's going to catch on, on the Internet. Throw together a few people with a camera, an obsession with a political figure, and a girl in shorts, and you get a most unusual video that's taking the web by storm. Here's CNN's Jeanne Moos.


JEANNE MOOS, CNN CORRESPONDENT (voice over): Don't worry, Mrs. Obama, even though the girl in the video calls your husband B for Barack.

UNIDENTIFIED MALE: Hey, B, it's me. If you're there, pick up. I was just watching you on C-Span.

MOOS: Yeah, well, everyone is watching this online, it's called "I got a crush on Obama".

FEMALE SINGER: I never wanted anybody more than I want you.

MOOS (on camera): So do you now have a crush on Obama?

UNIDENTIFIED FEMALE: Yeah, a little bit. Definitely.

FEMALE SINGER: Cuz I got a crush on Obama. I can't wait til 2008, baby, you're the best candidate --

MOOS (voice over): Actually these two have never met, and model Amber Lee Edinger (ph) is just lip synching the work of these three.

UNIDENTIFIED MALE: Whose brain child was it? Yeah, it kind of came --

UNIDENTIFIED MALE: I'd call it a collaborative effort.

MOOS: Between a journalism student, a record producer, and a digital marketing guy. They want to make comedy videos for their new website, barely political. And they happen to be big Obama fans.

UNIDENTIFIED FEMALE: We have a little crush on Obama, actually.

MOOS (on camera): Who's we?

UNIDENTIFIED MALE: We all have a little crush on him.


MOOS: They recruited Amber, the model, and ran around New York, shooting the video in a matter of hours.

FEMALE SINGER: You're into border security, let's break this border between you and me --

UNIDENTIFIED MALE: That's hot. That's cute right there. She's showing her assets.

MOOS: He's referring to her custom made -- uh --

(On camera): What do they call them?



MOOS: Now, they are selling "I got a crush on Obama" T-shirts. The lyrics were co-written and performed by Leah Kauffman.

FEMALE SINGER: I cannot wait to 2008, Baby, you're the best candidate --

MOOS: This same group did another popular online video. Maybe you heard about the "Saturday Night Live" skit featuring Justin Timberlake, presenting male anatomy in a box, as a gift. These three did a video response from the female point of view.

As for the Obama video --

UNIDENTIFIED FEMALE: This is, you know, social commentary.

MOOS: But the Obama campaign wouldn't comment. Except to say they had nothing to do with the video.

(On camera): Have you heard from his wife?

UNIDENTIFIED FEMALE: No, not yet. Not yet.

UNIDENTIFIED FEMALE: Cuz I gotta crush on Obama.

MOOS: But which Obama? One viewer posted -- I have a crush on Mrs. Obama.

FEMALE SINGER: I got a crush on Obama --

MOOS: She'll crush him if she sits down. Jeanne Moos, CNN, New York.


BLITZER: And speaking of YouTube, the video website will partner with CNN in our next Democratic presidential debate in South Carolina. That happens on July 23rd.

Let's bring in our Internet reporter Abbi Tatton.

How's this debate, Abbi going to work?

ABBI TATTON, CNN INTERNET REPORTER: Wolf, this debate is going to be different because it's the YouTube users, members of the public, who are going to be submitting the questions by submitting videos online. That's a process that started today on

And it's easy. If you have a question for the candidate, record it, upload that video, at CNN is going to be selecting those questions and the candidates will be answering them right here on CNN. The Democrats go next month, the Republicans in September. And Anderson Cooper, of CNN, is going to be moderating -- Wolf.

BLITZER: Thank you, Abbi, for that.

Let's take a look at some of the hot shots, coming in from our friends over at the Associated Press. Pictures likely to be in your hometown newspapers tomorrow.

In Frankfurt, a man wearing protective gear searches for moth nests in a German cemetery. The moths cause severe allergic reactions.

Palestinian boys play on a roof ladder. The fled the Nahr el- Bared refugee camp after weeks of violence.

In Gaza City, Hamas militants down energy drinks as the celebrate taking control of Fatah's preventive security headquarters.

And in Germany, a seven-month old polar bear locks eyes with his zookeeper friend during a play session at the Berlin Zoo.

Some of this hour's hot shots, pictures often worth a 1,000 words.

That's it for us. Tomorrow, John Edwards joins us, live, right here in THE SITUATION ROOM. We'll see you then. Let's go to Paula, in New York -- Paula.


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