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THE SITUATION ROOM

Al Qaeda Making a Shocking Comeback. A Key Interim Report Measuring the Progress in Iraq is Due Out Soon. Giuliani Under Fire From the Firefighters Union. Larry Flynt On a Mission As He Exposes Senator David Vitter's Phone Call to a Washington, D.C. Madam. A U.S. Attorney is Saying Brian Wells is a Co-conspirator in the Planning of a Bank Robbery.

Aired July 11, 2007 - 1900   ET

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


WOLF BLITZER, CNN ANCHOR: Thanks, Lou.
Happening now, breaking news -- al Qaeda making a shocking comeback. U.S. intelligence now saying the terror network has rebuilt and has regrouped and has a powerful capability to do harm. Is America facing a new threat right now?

A senator and family man exposed as an alleged client of the D.C. Madam. Why is "Hustler" magazine Larry Flynt playing gotcha with political conservatives?

And Richard Nixon raw and unfiltered -- the federal government takes over the library of the late president and releases some new audio tapes showing the good, the bad, and the ugly.

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

Let's begin with the breaking news -- a shocking terror comeback. Nearly six years after the 9/11 attack, al Qaeda has rebuilt and is as strong as it has been in years. That's the chilling conclusion of a U.S. intelligence report; even as the man in charge of homeland security says America may now be more at risk.

Let's go straight to our justice correspondent Kelli Arena. She's watching all of this. This is very dramatic stuff; al Qaeda supposedly has been hurt as a result of all these efforts over the past several years. But now, there's a new report suggesting maybe not. What's going on?

KELLI ARENA, CNN JUSTICE CORRESPONDENT: Well Wolf, this new analysis by the U.S. intelligence community does conclude that al Qaeda is operationally stronger than it was just a year ago and that despite U.S. bombings and other counterterrorism measures, it has been able to regroup and is at its strongest state since the war on terror began.

Now that's according to a senior government official who has seen the summary of the report. The report itself, Wolf, remains classified, but it does seem to back up what Homeland Security Secretary Michael Chertoff has warned that al Qaeda remains a threat and that the U.S. is vulnerable.

(BEGIN VIDEOTAPE)

ARENA (voice-over): Although he insists the U.S. is not facing an immediate terror threat, Homeland Security Secretary Michael Chertoff got tongues wagging when he said he had a gut feeling the U.S. was in a particularly vulnerable period.

SEN. JIM WEBB (D), VIRGINIA: I would hope that someone who is a director of homeland security would have something else to offer us if he's going to be talking like that.

ARENA: So Chertoff had to spend time today explaining what he meant.

MICHAEL CHERTOFF, HOMELAND SECURITY SECRETARY: We don't currently have specific, credible information about a particular threat against the homeland in the near future.

ARENA: Chertoff says recent attacks in the U.K. and history itself prove that summer is an especially attractive time for terrorists to attack. And he's urging Americans to remain vigilant. Critics suggest it's all a political ploy.

CHERTOFF: If people think the threats evaporated, they think that somehow all of al-Zawahiri statements reflect a change in attitude, and he doesn't want to carry out attacks, they are welcome to make that case. I have the basis of the facts to support what I'm saying here.

ARENA: The intelligence community and outside experts though back him up. They say al Qaeda has been able to find safe haven in the tribal areas of Pakistan and is regrouping.

JOHN KRINGEN, CIA DIR. FOR INTELLIGENCE: We see more training. We see more money. We see more communications, so we see that activity rising.

ARENA: Some additional proof, the volume of messages from al Qaeda leaders threatening the West. Another released just today.

DANIEL BENJAMIN, BROOKINGS INSTITUTION: What it does tell us is that al Qaeda feels that it's -- it's in a pretty safe place for recording messages and distributing them. They certainly don't look like they are on the run.

(END VIDEOTAPE)

ARENA: Wolf, you should also know that the FBI has put together a special small group of agents and analysts to comb through current threat information, and any and all leads to supplement work that's already being done in the field. Now this group was put together several weeks ago before the London attacks.

BLITZER: As you know, Kelli, and a lot of our viewers know that before 9/11, there was a lot of this so-called chatter, communications that U.S. intelligence was monitoring, but unfortunately they couldn't connect all the dots and 9/11 occurred. How does that chatter then compare to what we're being told that there's a lot of chatter happening right now?

ARENA: Well the counterterrorism officials and intelligence sources that I've spoken to, Wolf, say that they are not seeing anything like they saw pre-9/11. They are just not getting that level of information coming in, suggesting that something big is about to occur. They continue to say that there's no credible or specific information that there's any attack that's imminent against the United States.

BLITZER: Kelli Arena watching this for us -- thank you, Kelli.

Stay tuned to CNN day and night for the most reliable news about your security. We're staying on top of this story.

Meanwhile, al Qaeda playing a role in the chances for success and failure in Iraq, as well and we're learning that a key report measuring the current progress in Iraq will likely be released in the coming hours.

Let's go to our White House correspondent Ed Henry. He's watching this story for us. They are saying this so-called interim report mandated by Congress could come as early as tomorrow, is that right?

ED HENRY, CNN WHITE HOUSE CORRESPONDENT: That's right, Wolf. Two senior White House officials say that as early as Thursday we will see the president releasing this interim report on progress in Iraq to the Congress. He's likely to make a public statement, but he's not going to do any sort of a primetime address.

Number one, White House officials say they don't want to magnify this anymore because it is a preliminary report, a snapshot, as they are trying to say, but also they don't want a primetime address because there's going to be some bad news in here, and they are trying to downplay it as much as they can.

One senior official predicting it will be a 50/50 split with the report expected to show satisfactory progress in about half of the 18 benchmarks, unsatisfactory progress on the others. In real terms what does this mean? The report will show a drop in sectarian killings on the military side.

For example, it will also show a failure by the Iraqi government to come up with political reform, such as a law-sharing oil revenue. Now, Senator John McCain, a big supporter of the president on the war, obviously was here at the White House a short while ago, meeting with the president.

Afterwards he told reporters he thinks, based on what he knows, this report will show some success on the military side, but he added bluntly, quote, "on the political side, there will be none." That means some real challenges for a White House already on the defensive, Wolf.

BLITZER: Relying on the Iraqi government, so far that government has not come through. Thank you very much, Ed, for that. Amidst all of this, the United States military now arguing that Iran's aid to Shiite militants represents not only a serious threat to American forces, but also to success to the overall operations in Iraq. And now Sunni insurgents are weighing in, threatening war against Iran if it doesn't stop aiding their enemies.

Let's go to our Pentagon correspondent Barbara Starr. Barbara?

BARBARA STARR, CNN PENTAGON CORRESPONDENT: Wolf, just as the administration is about to report on the surge, new worries about al Qaeda in Iraq.

(BEGIN VIDEOTAPE)

(SOUNDS)

UNIDENTIFIED MALE: Show room. Show room.

STARR (voice-over): The U.S. intelligence community has now weighed in with a grim view on whether the surge is working.

THOMAS FINGAR, DEP. DIR. OF NAT'L INTELLIGENCE: It has not yet had a sufficient effect on the violence in my judgment, to move the country to a place that the serious obstacles to reconciliation can be overcome.

STARR: The U.S. military now estimates 60 to 80 foreigners a month come to Iraq to work for al Qaeda. Nearly three-quarters are smuggled in across the Syrian border. And 80 to 90 percent of the suicide attacks are carried out by foreign fighters. The Islamic State of Iraq, an al Qaeda umbrella organization, is warning Iran it could face all-out war if it doesn't stop interfering in Iraq, another sign of efforts to continue the violence.

BRIG. GEN. KEVIN BERGNER, U.S. ARMY: It's consistent with what we have seen in the past from al Qaeda, which is an attempt to turn Iraqis against one another, to sew division between these different sectarian and ethnic groups.

(END VIDEOTAPE)

STARR: General Bergner also predicts that in the weeks ahead, in his words, al Qaeda will stage spectacular attacks to try to reassert its position. The only question may be whether the surge will be enough to stop it. Wolf?

BLITZER: Barbara Starr at the Pentagon, thank you.

This sad note to report -- Lady Bird Johnson, who became first lady during one of the darkest days in American history, died of natural causes late this afternoon. A family spokesman says she passed away in her home in Austin, Texas surrounded by family.

She was perhaps best known as a passionate conservationist and tenacious advocate for her husband. Lady Bird Johnson was with her husband in Dallas, Texas, on November 22, 1963 when John F. Kennedy was assassinated and she was at his side later when he was sworn in as the nation's thirty-sixth president aboard Air Force One. Lady Bird Johnson was 94 years old -- our condolences to her family.

Let's go to Jack Cafferty in New York for "The Cafferty File". Jack?

JACK CAFFERTY, CNN ANCHOR: Thanks, Wolf. Some tough words for Rudy Giuliani coming today from some New York City firefighters and their families. In a video put out by the International Association of Firefighters, the former New York mayor is blasted for his handling of the 9/11 terror attacks.

(BEGIN VIDEO CLIP/INTERNATIONAL ASSOCIATION OF FIREFIGHTERS)

UNIDENTIFIED MALE: They attacked us in '93.

UNIDENTIFIED MALE: And yet eight and a half years later, New York City firefighters, the greatest fire department in the world, we are using the same radios that we knew didn't work.

UNIDENTIFIED MALE: We have remains of dead heroes out at the garbage dump because of Giuliani and his administration. And they are still there today, and they won't remove them.

(END VIDEO CLIP)

CAFFERTY: Tough stuff. Giuliani's basing, of course, a lot of his campaign on his response to those 9/11 attacks. Giuliani's campaign says that union leaders don't speak for rank and file firefighters, and they also sent out a history of Giuliani's support for firefighters yesterday, before this video came out.

Highlighting steps he took to improve their health and safety, increase the fire department's operational capacity here in New York, plus the millions he provided to improve the fire department's infrastructure. However, no mention was made of those radios used on 9/11.

Howard Safir (ph), who was Giuliani's fire commissioner and later police commissioner here in New York, said in a statement, quote, "Firefighters across the country have no greater friend than Rudy Giuliani". So here's the question.

How much does it matter if Rudy Giuliani does not have the support of some New York City firefighters and their families? E-mail your thoughts to CaffertyFile@CNN.com or go to CNN.com/CaffertyFile. Wolf?

BLITZER: That videotape they put out today, Jack, as you know, was very, very powerful.

CAFFERTY: Yes, there's a lot more to it. We just ran a little piece, but it's...

BLITZER: Yes.

CAFFERTY: ... very tough stuff.

BLITZER: Very stuff. Thank you, Jack.

Coming up, "Hustler" politics -- Larry Flynt on the prowl right now for Washington sex scandals. One U.S. senator already exposed.

Plus, White House cursing. Newly released Nixon tapes. Hear the choice words the former president uses to describe his political foes.

And the former surgeon general of the United States says the Bush White House muzzled him and put politics over science. Richard Carmona is my guest this hour right here in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: "Hustler" magazine publisher Larry Flynt is claiming a victory, exposing a conservative Republican senator as an alleged client of the so-called D.C. madam. Let's go to CNN's Carol Costello.

She's in New York. She's watching all of this. What exactly is Flynt saying, Carol, about the scandal involving Louisiana Senator David Vitter?

CAROL COSTELLO, CNN ANCHOR: Well Wolf, he says it was he and the alleged D.C. madam's phone list that outed Senator Vitter. He said he called Vitter for a comment, and the senator made an end-run to The Associated Press so he could control the situation.

(BEGIN VIDEOTAPE)

COSTELLO (voice-over): Larry Flynt would say there is one less known hypocrite on the Hill. Senator David Vitter accused of being a client of the alleged D.C. madam, Deborah Palfrey. Vitter, who touts himself a family man, now accused by a pornographer, and a woman who runs an escort service. Flynt admits though he has a political motive, as well.

LARRY FLYNT, "HUSTLER" MAGAZINE PUBLISHER: He was to the right of Attila the Hun (ph) every step of the way. And I'm going to do my part to get him out of that.

COSTELLO: And Flynt says he's not done yet.

FLYNT: Now, you guys always know in the past, I deliver.

COSTELLO: He's talking about '98 when he launched his first hypocrite hunt, angry at what he called the hypocrisy during the rush to impeach Bill Clinton. He made life miserable for Georgia Congressman Bob Barr (ph), saying that in contrast to his public opposition to abortion, he drove his wife to a clinic to have an abortion performed.

Barr (ph) denied the charge, but a federal court dismissed his lawsuit against Flynt. Another prominent Republican, former representative Bob Livingston suffered, too. He was among those calling for President Clinton to resign over the Lewinsky affair, saying apologies were not enough.

BOB LIVINGSTON (R), FORMER U.S. REPRESENTATIVE: The president has his own actions to justify. I will not seek to give him counsel.

COSTELLO: Livingston urged a vote to impeach, and just as he was about to become House speaker, Larry Flynt accused him of infidelity and Livingston resigned.

UNIDENTIFIED MALE: And I beg your forgiveness.

COSTELLO: He hopes Vitter will do the same.

FLYNT: You've got people that don't have an ounce of the character that I have that are running our government. So, I'm saying, you know, this is payback time. Payback is a bitch.

(END VIDEOTAPE)

COSTELLO: Now you notice that comment, payback is a bitch, he seems to be talking about the government's case against him and his magazines, way back in 1978. Somebody shot him during that time, and that's why he speaks that way. He's been paralyzed from the waist down for quite a long time. He says as editor of "Hustler" magazine, he is no hypocrite about sexual behavior, illicit or otherwise. As for Senator Vitter, he says he's committed a great sin and has asked forgiveness from God and his wife.

BLITZER: So, this explains why Larry Flynt is so determined to do this. Is that right?

COSTELLO: Well, it seems to be that way. I mean he's willing to spend a million dollars for information. He says he doesn't mind spending the money. He doesn't mind if anyone else cares. He has made this his mission, and by that last bit of sound that you heard, it seems that you know it's payback time.

BLITZER: We'll see what comes up. Thanks very much for that. Carol Costello doing some good reporting for us.

Meanwhile, where is the senator whose name is now involved in this scandal?

Our Brianna Keilar is following this part of the story and has more. Brianna?

BRIANNA KEILAR, CNN CORRESPONDENT: Wolf, all eyes were watching Capitol Hill today, waiting to see if Senator Vitter would show up for an important Iraq war vote. Well, he didn't. In fact, the man who won his seat in the U.S. Senate by campaigning on family values is nowhere to be found.

(BEGIN VIDEOTAPE)

KEILAR (voice-over): Just last year, Senator David Vitter, a father of four, told his local newspaper, "The New Orleans Times Picayune" that infidelity, divorce and dead-beat dads are a threat to traditional families. He's made a name for himself as a staunch conservative, supporting the teaching of abstinence and sex education, fighting the funding of overseas Aids programs that don't oppose prostitution, and backing a constitutional amendment banning same sex marriage.

His voting record paints one picture, but the phone records of alleged D.C. madam Deborah Jeane Palfrey tell a different story. On February 27, 2001 while Vitter was a member of the House of Representatives, a call was placed from his cell phone to Palfrey's business, an escort service that government prosecutors allege was actually a prostitution ring.

CNN confirmed the number was Vitter's using a public records database. The number is now out of service. Vitter says several years ago he asked God and his wife for forgiveness. Perhaps the most ironic twist of this whole scandal may be the circumstances that brought Vitter to Washington in the first place.

In a special election he won the seat of Robert Livingston, the House speaker-elect who resigned after conceding he had several extramarital affairs. Like Vitter, Livingston's admission also followed an investigation by publisher and pornographer Larry Flynt.

But will Vitter step down? Back in 1998, as Republicans led the charge to impeach President Bill Clinton after he lied about his involvement with Monica Lewinsky, Vitter wrote an op-ed in "The Times Picayune", arguing that if Congress didn't take action against Clinton, his leadership would, quote, "only further drain any sense of values left to our political culture."

(END VIDEOTAPE)

KEILAR: We'll have to see if Vitter feels the same way about his own actions. Wolf?

BLITZER: Brianna, thank you -- Brianna Keilar reporting.

Still ahead -- human time bomb. Find out how a pizza deliveryman may have ended up with a bomb around his head during a bank robbery gone wrong. There's now a break apparently in this cold case mystery.

Plus, because of new 9/11 travel restrictions, many Americans have been reduced now to begging and pleading just for the right to travel abroad. We're going to tell you what's going on.

Much more of our coverage coming up, right here in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: A very strange turn of events in an already bizarre case. A pizza deliveryman killed by a bomb locked around his neck said gunmen put it on him before forcing him to rob a bank. Now almost four years later indictments are shedding new light on this mystery.

Let's go to CNN senior correspondent Allan Chernoff. He's joining us from Erie, Pennsylvania with details. Allan, what's going on?

ALLAN CHERNOFF, CNN SENIOR CORRESPONDENT: Wolf, the man who appeared to be an unwilling participant in that bank robbery, prosecutors now charge he actually was involved in plotting the crime.

(BEGIN VIDEOTAPE)

CHERNOFF (voice-over): As bank robber Brian Wells sat in police custody with a bomb locked around his neck four years ago, he insisted he had been forced to rob the PNC Bank (ph), forced to wear the explosive that was ticking away.

UNIDENTIFIED MALE: Why is nobody trying to get this thing off?

CHERNOFF: Minutes later, the bomb exploded, killing Wells. Despite that tragic outcome, prosecutors have concluded Wells in fact was one of the conspirators who planned the robbery.

MARY BETH BUCHANAN, U.S. ATTORNEY: It was the participant's intention to have it seem as though the person wearing the explosive device was a hostage.

UNIDENTIFIED FEMALE: Liar!

CHERNOFF: Brian Wells' siblings and mother heckled the U.S. attorney during her news conference, arguing prosecutors are mistaken.

JOHN WELLS, BRIAN WELLS' BROTHER: Brian was a complete innocent murder victim in this case. There is no evidence suggesting otherwise, or you would have heard that evidence today.

CHERNOFF: The mastermind prosecutors say was Marjorie Deal Armstrong (ph), who allegedly recruited Kenneth Barnes (ph) to kill her father and wanted to pay him with proceeds from the bank robbery. Both are in prison for unrelated crimes, and now face three criminal charges for the bank robbery that could result in life sentences.

MARK POTTER, ATF: The brutality and utter lack of respect for life displayed by the indicted is rarely seen outside a movie script.

(END VIDEOTAPE)

CHERNOFF: A source with knowledge of the investigation tells CNN that the evidence implicating the pizza deliveryman, Brian Wells, includes an eyewitness who saw Wells attend a meeting with the other conspirators where they plotted the crime. CNN has also learned that the original plan called for Wells to wear a fake bomb, and at the last minute, before the actual robbery, he was forced to wear a real one. Wolf?

BLITZER: What a bizarre story. You can't make this kind of stuff up. Thanks, Allan, for that -- Allan Chernoff reporting from Erie, Pennsylvania. Just ahead, a former U.S. surgeon general says he was muzzled by the Bush administration. Did the White House play politics with your health? My interview with Dr. Richard Carmona. That's coming up.

Also, a reporter who got too close to the story and lost her job because of it. You're going to find out why she says sexism and a bathing suit is the real issue.

Stick around. You're in THE SITUATION ROOM.

(COMMERCIAL BREAK)

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

Happening now -- outrage. Many around the world are angry over the re-release of a Vatican document that restates points from a document released back in 2000 that says protestant and other church communities are not true churches, and do not have the, quote, "means to salvation."

An important test vote on Iraq fails. A Democratic sponsored amendment would have restricted U.S. troop rotations in Iraq and Afghanistan to ensure troops have more time back here at home. But the motion to cut off debate over the amendment and proceed with an actual vote on it failed by four votes.

And President Bush orders the former White House counsel Harriet Miers to defy a subpoena from the House Judiciary Committee, questions over the firings of those U.S. attorneys. President Bush claims executive privilege, therefore saying Miers is immune from the subpoena.

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

Passport outrage is growing as the State Department scrambles to cope with a massive backlog of applications, and now the United States Congress is demanding answers.

Let's go to CNN's Tom Foreman. He's here in THE SITUATION ROOM watching this. Is there any insight to this huge backlog?

TOM FOREMAN, CNN CORRESPONDENT: Well, this is one of these things that, you know, the government came up with the plan, now they are saying they weren't ready for it. There are all sorts of complaints about the lines, you can't get through on the help calls, and the blame game is in full swing.

FOREMAN: ... the government came up with the plan, now they are saying they weren't ready for it. There are all sorts of complaints about the lines, can't get through on the help calls, and the blame game is in full swing.

(BEGIN VIDEOTAPE)

When angry passport applicants aren't waiting in line, they are calling their Congressmen. Like California Democrat, Tom Lantos.

REP. TOM LANTOS, (D) FOREIGN AFFAIRS CHMN.: What a travesty. And all too reminiscent of how badly the administration botched the job of planning and responding to hurricane Katrina in 2005.

FOREMAN: The folks back home gave an earful to Lantos, chairman of the House Foreign Affairs Committee, and he unloaded on the State Department.

LANTOS: Millions of Americans are constituents, have been reduced to begging and pleading, waiting for months on end, simply for the right to travel abroad.

MAURA HARTY, ASST. SECRETARY OF STATE: The Bureau of Counselor (ph) Affairs has learned important lessons from this experience.

FOREMAN: The State Department underestimated the impact of post 9/11 security rules imposed by Congress. Requiring Americans traveling to Mexico, Canada and the Caribbean to have a passport. And now, a huge backlog remains, even after some of the new requirements have been suspended.

Two point nine million applications are in the pipeline right now. Twelve million already have been issued this year, almost 18 million could go out by year's end. That would be a 50 percent increase in the normal load. State Department has hired more staff, pulled some employees back from overseas, even yanked some out of language training.

HARTY: And I, too, regard the situation as untenable. We are taking the steps necessary to restore reliable service as soon as possible.

FOREMAN: The result of all that so far? She says, delays are now down from 12 weeks to 10. Officials predict the wait will be back to normal, six weeks, by year's end. But what do people hearing the complaints think?

LANTOS: I don't believe it.

(END VIDEOTAPE)

FOREMAN (on camera): Well, one thing that really riles people is this: some of them paid an extra $60 to expedite the process. So, they would be sure to get their passports in time.

Now, the department website invites people to send a letter, if you think you didn't get it expedited, to maybe get your money back. And a lot of people in line are saying, hey, hand's down, this is failing. Give us all the expedited money back right now, because nothing's been expedited the way they want it to.

BLITZER: Well, I know one thing for sure. People at the U.S. Passport Office are working literally around the clock to try to deal with this.

FOREMAN: Oh, yes. It's huge.

BLITZER: I have a nephew who works there, and I know he's working really, really hard. They have a problem. Apparently they just don't have enough manpower to get the job done.

FOREMAN: Yes. You better order him a pizza, he's going to be there late.

BLITZER: They are all working really hard. Thanks for that.

Meanwhile, confirmation hearings are due tomorrow for the president's controversial pick to serve as the next surgeon general of the United States. But is the White House playing politics with all of our health? A physician who previously served as the nation's top doctor, says he was muzzled by the Bush administration.

I spoke earlier with the former U.S. Surgeon General, Dr. Richard Carmona, and asked him about allegations of political interference.

(BEGIN VIDEOTAPE)

DR. RICHARD CARMONA, FMR. U.S. SURGEON GENERAL: Well, there are a number of issues. Whether it be stem cells, abortion, plan B, whether it's global health reports, reports that were stymied, reports that were not allowed to develop that the public needed information. That, for political reasons, that information was not allowed to get out.

BLITZER: So how did that happen? Let's talk about embryonic stem cell research. What would happen?

CAMRONA: Well stem cell research basically, when I did speak out about that, in some of my discussions. But it was limited, because I was told, the policy's been set. The decision has been made. But as I looked at the American public, there was a lack of knowledge about this issue of stem cells.

Really, people were -- they didn't even know what it was, let alone could they make an informed decision.

BLITZER: And so what did they say to you? You can't talk about this?

CAMRONA: We'll it wasn't so much you can't talk, but we already have a policy, you don't need to deal with that. Don't talk about it. And people frowned on that, if I stepped forward, and continued to speak about it.

BLITZER: How would they do that? How does that happen? Here you are, the surgeon general. You have to go out and speak, you have to testify. You have to vet all your comments with officials with the White House?

CAMRONA: Well, it's interesting you should bring that up. It's not so much officials at the White House, there is people right within the agency itself, HHS, that ...

BLITZER: The department of Health and Human Services.

CAMRONA: Yes. And, of course, they have communication with the White House, as well.

BLITZER: These are political appointees you are talking about.

CAMRONA: Yes. But my speeches were vetted. My speeches were often not allowed to go forward because they didn't have enough political rhetoric in it. There was devoid of science, where I felt I should be speaking about science, not political issues.

I had speech writers who were constantly in a battle position. Because they were trying to reflect my voice on science, yet they were told more and more to put political things into speeches.

BLITZER: And to make, in effect political statements.

CAMRONA: Yes.

BLITZER: And, also, I mean, even a simple thing like, going out and speaking about, or attending the Special Olympics. This is -- this was a shocking little tidbit that I heard, but tell our viewers what happened.

CAMRONA: Well, what I tried to do, like all the surgeon generals, is to look out at the nation and see where are the health needs that as are unmet. And one of the areas that I saw, and I put out a report, a surgeon general's call to action on the health of people with disabilities.

I got very involved with the disability community. Special Olympics was one of those areas, Best Buddies was another, dealing with children with intellectual disabilities. And I was invited to speak at the Special Olympics overseas, in Japan. That was denied. But they never gave me an explanation. So I backed away from it. The next year, I was asked to come to a Special Olympics event, and a Best Buddies event, and that was also denied. And when I spoke to some of the political folks about it, I was questioned, in fact, almost admonished as to why do you want to do this? I said these are children who are disabled, and I made my case based on science. I was told, aren't you aware that who is behind all of this? Why would you help those people? OK. Meaning, people of the other party. And I said ...

BLITZER: It wasn't just the other party, it was a specific family.

CAMRONA: Well, I'm not going to mention specific names, but clearly I was ...

BLITZER: Because the Kennedy family, so involved in both of those projects.

CAMRONA: And I was admonished. And I was told, no, you can't make the trip. My orders were not approved.

So, I had made a commitment already to the group. Not a political family, but to children who had disabilities, who needed a voice, and I went. I took time off and I went on my own dime, so to speak, to be with those children and participate in their organization.

BLITZER: You believe the health of the American public was badly served as a result of this political pressure on you?

CAMRONA: What I believe is that, in a democracy, we should never restrain free speech. And surgeon generals should never be restrained from speaking about prudent science.

Not policy, not political agenda, but giving the best science to the American public, so they can make their decisions, and hold their elected officials accountable based on policy that is extensively passed, on their behalf.

BLITZER: Here is a statement the White House put out in response to some of your criticisms.

"As Surgeon General, Dr. Carmona was given the authority and had the obligation to be the leading voice for the health of all Americans. It's disappointing to us if he failed to sue his position to the fullest extent in advocating for policies he thought were in the best interests of the nation. We believe Dr. Carmona received the support necessary to carry out his mission."

That's carefully crafted statement, coming from a White House spokesman.

CARMONA: Sure. Well, I'm not surprised. I mean, you know, I've seen these kind of responses before through my administration, as well as through the previous surgeon generals. But I don't think there's any reason to be defensive. The surgeon generals, and I, Surgeon General Koop (ph), Surgeon General Sature (ph), representing all surgeon generals, basically did not point fingers.

We purposely wanted to address this issue as a systematic failure. Because the public is not being represented well, and rather than looking back and pointing fingers at who did what, let's move forward and fix the system. So it benefits the American public, efficiently and effectively and perpetuate this dysfunction that's been apart of the office of the surgeon general for a long time.

BLITZER: We are going to leave it right there. Dr. Carmona, thanks for coming in.

CARMONA: Thank you, sir.

(END VIDEOTAPE)

BLITZER: A leading public health group came out today against President Bush's new nominee for surgeon general, Dr. James Holsinger (ph). The American Public Health Association says it is, quote, "very concerned with Dr. Holsinger's past writings regarding his views of homosexuality, which put his political and religious ideology before established medical science."

The group's opposition comes just one day before his Senate confirmation hearings are to start.

Up ahead tonight, a reporter becomes part of a story, and is fired. It involves a missing woman and her estranged husband and a controversial act from the reporter covering it all.

And, former President Richard Nixon with some candid words for his opponents, in newly released audio tapes. We're going to play them for you. You're going to want to hear this. Stick around, you're in the SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: A Chicago TV news reporter is out of a job over a move she admits was wrong, but says she's -- the real story here, is sexism. Let's go to Mary Snow in New York, she's watching this unfold. What's this all about, Mary?

MARY SNOW, CNN CORRESPONDENT: Wolf, it is a case where ethics and journalism were put to the test with a bikini becoming a symbol to a reporter getting too close to a story.

(BEGIN VIDEOTAPE)

(voice over): This is the image that cost Amy Jacobson her job. In this videotape posted by her rival Chicago station, WBBM, she is seen after swimming at the pool of Craig Stebbeck, a man who's estranged wife disappeared over two months ago.

It's a story Jacobson has been covering, and she told WGN Radio she was there working on it.

AMY JACOBSON, REPORTER: I know that I made a horrible mistake. I understand that. But a fireable mistake? I don't think so. Nothing improper happened. SNOW: Jacobson says she was on the way to a pool club with her two small sons, when Stebbeck's sister invited her over to discuss the case. And Jacobson made a detour.

But media Critic Howard Kurtz doesn't buy it.

HOWARD KURTZ, MEDIA CRITIC: Amy Jacobson can try to explain this away as just working the story, and yes, she had her kids with her. But you don't do this. The appearance is awful.

SNOW: It is the appearance worse because she's in a bikini?

PHIL ROSENTHAL, CHICAGO TRIBUNE MEDIA COLUMNIST: It's that image of Amy Jacobson in her swim suit that I think, is the lasting impression of this.

SNOW: And Amy Jacobson believes it is because she is a woman in a bathing suit that made the difference.

JACOBSON: If I was a man, this would not be an issue. That's what I believe truly in my heart.

SNOW: Chicago Tribune Media Columnist, Phil Rosenthal says the case also focuses attention overall on some of the cozy relationships in Washington where reporters and sources socialize.

But Kurtz says there's a difference.

KURTZ: This is not a reporter taking a source to dinner at a Georgetown restaurant. Showing up at the home of a man whose wife is missing, you are covered the story, you are wearing a bathing suit, that's a whole different level of socializing.

(END VIDEOTAPE)

SNOW (on camera): And one thing many agree on, if there had not been a videotape, Jacobson might not have been fired. We did request an interview with Amy Jacobson, but she didn't get back to us.

Wolf?

BLITZER: Well, based on some of her earlier comments, what is she saying should have been done to her?

SNOW: She thinks that she should have been suspended. She said, yes, she did cross a line. But she says she doesn't think it should be a career-ender, and said that she didn't do anything improper at that house.

BLITZER: Thank you. Mary Snow is watching this story for us.

Up ahead, the former president of the United States, Richard Nixon, lashing out with some very foul language at his opponents. We're going to play for you some newly released audio tapes, tapes you haven't heard before, the expletives, let me repeat this, the expletives won't be deleted. Won't be deleted. Plus, Jack Cafferty with your e-mail on our question of the hour. How much does it matter if Rudy Giuliani doesn't have the support of some New York City firefighters? Stick around. You're in the SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: Remember the Watergate tapes and those foul-mouthed tirades in the Oval Office? Well, now, more recordings shedding new light on the White House years of Richard Nixon are emerging.

Let's go to CNN's Brian Todd, he's watching this unfold. He's also listening to this unfold. These are new tapes, new documents, that we haven't seen or heard before.

BRIAN TODD, CNN CORRESPONDENT: We have not, Wolf. Just out today, reams of material, audio tapes, documents on the Nixon presidency. Part of what the Nixon library calls it's new mission.

Starting today the library is now under federal government control, and it's directors say they want to give an unvarnished, nonpartisan view of the man, salty language included.

(BEGIN VIDEOTAPE)

(voice over): Election night, 1972. Richard Nixon celebrating his greatest political victory. A landslide win over George McGovern. In a phone conversation with Henry Kissinger, shortly after midnight, Nixon lets loose on his opponent.

RICHARD NIXON, FMR. U.S. PRESIDENT: This fellow to the last was a prick. Did you see his concession statement?

TODD: That excerpt, part of the Nixon library's new release of hours of Nixon's phone conversations from that period. Shortly after Kissinger's call, Nixon speaks to his deputy counselor Harry Dent, and has not mellowed toward McGoveren.

NIXON: That son-of-a-bitch. Didn't you think he was about the worst candidate, Harry?

HARRY DENT, NIXON DEPUTY COUNSELOR: Yes, sir. Yes, sir.

NIXON: What he said I think - we're not gonna let them get away with that you know. Even last night, he started out nicely in his thing but then proceeded to jut his jaw out and said he wasn't gonna support, you know, this or that. Did you notice that?

DENT: Yes, sir.

NIXON: What did you think of that? As far as grace - I came on, I was, I thought, quite graceful to the son-of-a-bitch.

TODD: Thirty-five years later, George McGovern listens with us to his old foe. He says he never refused to support Nixon. He jokingly calls it a great distinction to be called those names by the president. But?

GEORGE MCGOVERN, (D) FMR. PRESIDENTIAL CANDIDATE: I also found it rather sad. Here is this man who has just won the most smashing triumph of his entire life, angry, frustrated, peevish.

TODD: The director of the Nixon library says on that evening, Nixon didn't even have his family around him.

TIMOTHY NEFTALI, DIR. NIXON LIBRARY AND MUSEUM: On the night of his election. He's alone. Contemplating the effect of his victory. Complaining if you will, celebrating. But it's Nixon, alone.

TODD: A few days after his election victory, Nixon's shuffling his cabinet. He talks about replacing the U.S. ambassador to the U.N. A man named George Herbert Walker Bush.

NIXON: You know that whole staff up there is violently anti- Nixon, and Bush hasn't done one damn thing about it. He's become a part of it.

(END VIDEOTAPE)

TODD (on camera): We contacted George Bush Sr.'s office for a response to that remark from Nixon. An aide said Mr. Bush would not comment.

Wolf?

BLITZER: Brian Todd, thank you. Fascinating, fascinating history.

Let's go to Jack Cafferty in New York. It is pretty amazing stuff, to hear those audio tapes of what happened in unguarded moments, supposedly.

CAFFERTY: It brings a lot of memories back, as well. I remember listening to those tapes recorded in the Oval Office, from which the little snipit that was found to be missing that eventually led to his downfall. But he was an interesting man.

The question this hour, Wolf, is how much does it matter if Rudy Giuliani doesn't have the support of some New York City firefighters? We got a lot of mail on this.

Matt writes from Illinois, saying it matters quite a bit. Considering this is a candidate that wouldn't be running for president if it wasn't for his association with New York and the 9/11 attacks.

"He doesn't have much else besides that and has unfortunately used the terrible attacks as political leverage. His support in the Republican Party will begin fading soon enough."

John in Wyoming writes "So some of the unionized firemen in New York don't like Rudy, eh?? If that means anything, it raises my opinion of Rudy! I respect the firemen for the jobs they do, but I draw the line at their union and political activities." Gibson writes, and he was at Ground Zero for a time after the tragedy. Jack, firefighters area against Giuliani. "He put the rush on the cleanup to get the economic structure back. He had the bosses at the site move us out of the way, when we were recovering ash and bone fragments to get the machines in faster. I worked there for eight months. I saw it, and so did others. We nearly rioted when we were threatened with this, as we recovered ash and bone from the members of our company, Squad 41 on March 17th, 2002."

James in Washington, of course it matters Rudy Giuliani doesn't have the support of some NYC firefighters. "His entire platform is based on the notion that he is the hero of 9/11 and the guy who is going to keep us safe. The NY firefighters were, and still are, the symbol of heroism on 9/11 and, without their support, Giuliani's campaign will ring hollow among voters."

Brian in Texas "It doesn't matter to me. But as an Independent, I would like to know which Democrat paid for that video. Unfortunately, politics are now so bitter that I do not believe any of them."

And finally, Colin in California, "It means a lot being that the former mayor is riding his campaign on his knowledge, or lack thereof, of terrorism. The firefighters had to do a lot more than just show up that day, if they cannot judge the former mayor's performance on the issue, who can?

If you didn't see your e-mail here, you can go to CNN.com/caffertyfile. We post more of them there along with video clips of the Cafferty file. Old recordings, as it were.

Wolf?

BLITZER: That's correct. Thank you, Jack for that.

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

Paula?

PAULA ZAHN, HOST: Thanks, Wolf. We're going to start off tonight with more on the reports that al Qaeda has regained its strength.

In fact, some people saying it is just as strong as it was before 9/11, and is ready to attack America again. Is this a real possibility or just scare tactics? And, folks playing the terror card.

Also, what happened to the ban on prayer in public schools? And why are some schools letting Muslim students pray? Are they getting special treatment? It's a story we're going to debate coming at you in just about seven minutes from now.

Wolf?

BLITZER: All right, Paula, thank you for that.

Still ahead here, in the SITUATION ROOM, White House officials may not change what they say to the media, but they are changing where they say it. White House reporters getting some new digs. We're going to take you on a tour. Stick around. You're in the SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: Let's get a quick look at some of the Hot Shots. In India, a boy uses plastic cans to help him wade through flood waters.

In Pamplona, Spain, revelers are chased in the fifth day of the running of the bulls.

In France, bicyclists race through the countryside during the Tour de France.

And in Santa Monica, California, check it out. A man dressed as a robot gestures at a Nintendo media briefing.

Some of this hour's hot shots. Pictures often worth a thousand words.

More comfortable work spaces are in, spiders and other creatures, we hope, are out. Today, President Bush came out with a major unveiling over at the White House.

Our White House Correspondent Suzanne Malveaux has more.

(BEGIN VIDEOTAPE)

SUZANNE MALVEAUX: Well, Wolf, we've been working across the street for the last year. It was the first time in more than a century, that the White House Press Core was not actually covering the president here on campus. Well, today, that changed when we came back.

GEORGE W. BUSH, U.S. PRESIDENT: Thank you very much.

MALVEAUX: The Press Corps, covering the president, is back in the White House.

BUSH: We missed you.

Sort of.

MALVEAUX: Mr. Bush unveiled the new glossy, state of the art, high tech briefing room. After a nearly year-long renovation. It started with putting in air conditioning.

BUSH: Modern conditions. Conditions where, you know, fellow like me would feel comfortable coming in here and answering a few questions without losing 20 pounds.

MALVEAUX: It's a big improvement. A sleek new podium, larger work spaces. Seats with internet, phone and power connections.

Robotic cameras, and 570 miles of cable, in what was once the presidential swimming pool below. It may not look like much, but this is what it was like before. Broken, tattered chairs. Chipping paint. Asbestos, cluttered work quarters no bigger than closets. And an infestation of other living things.

ELAIN QUIJANO, WHITE HOUSE CORRESPONDENT: And remember the spiders? Dangling from the ceiling as you would be typing. And little friends coming down to visit once in awhile.

MALVEAUX: And then the mice that used to scamper a bit.

UNIDENTIFIED MALE: It was a rat hole. No doubt about it.

MALVEAUX: So, will this sleeker set make it any easier for the White House to spin?

So, Helen, do you think they will tell us the truth anymore now that they have a new stage?

HELEN THOMAS, SYNDICATED COLUMNIST: No. But I'm glad they kept a promise that we would come back to the White House.

MALVEAUX: Since the renovation, the White House has played musical chairs. CNN's been moved to the front row, where the most prominent networks are assigned.

My Fox colleague, second row. So, Bret, how are the nose-bleed seats here?

BRETT BAIER, FOX NEWS WHITE HOUSE CORRESPONDENT: Man, do you have to do this to me?

MALVEAUX: Is this a fair and balanced view here from the second row?

BAIER: Very fair and balanced. Right behind Helen Thomas. We think we are central focus, left and right. All good.

THOMAS: I like being front row center. I can stare them down, and so forth, and ask the questions, and I can be heard. I hope the answers will be a little better than we've had.

MALVEAUX: More likely, than not, the answers won't come at all. President Bush playfully reenacted a familiar routine.

BUSH: I'm going to cut the ribbon. Would you, then you yell. I cojutate (ph) and then smile and wave.

MALVEAUX: Perhaps, with the new digs, we will see more of Mr. Bush. We'll certainly keep asking.

Well, Wolf, there are some who doubted they would ever let us back in but this is still a work in progress and the price tag is unknown. It started off at $20 million. Wolf?

BLITZER: A lot better than it used to be when I was there. Thanks, Suzanne, very much. That's it for us, we'll see you tomorrow. Let's got to Paula in New York.

Paula?

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