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Senator Clinton Unveils Health Care Plan; President Bush Picks Judge Mukasey for Attorney General

Aired September 17, 2007 - 16:00   ET


WOLF BLITZER, CNN ANCHOR: Happening now, after failing the first time, Hillary Clinton wants another chance. She says if she's president, every American will have health insurance. But critics dismiss it as a health scheme that will be bad medicine for you.
President Bush picks what he calls a tough but fair judge to be attorney general. Democrats, at least a lot of them, seem to be pleased with Michael Mukasey's nomination. What are conservatives saying? Did the president blink?

And John McCain says he won't try to win votes by advertising his religion, but he makes a surprising revelation about his faith. I'm Wolf Blitzer, you're in THE SITUATION ROOM.

Democratic presidential candidate Hillary Clinton makes a major announcement today about how she plans to solve the country's health care crisis. It's an issue Senator Clinton is painfully familiar with. The reform plan she proposed as first lady more than a decade ago was ridiculed and eventually defeated. Joining us now with some details about Senator Clinton's new and ambitious approach, our senior political correspondent Candy Crowley. She's watching this story unfold in Des Moines. Candy?

CANDY CROWLEY, CNN SR. POLITICAL CORRESPONDENT: Well Wolf, as you noted, the last time Hillary Clinton tried her hand at a health care plan, it didn't go that well. This time around her campaign believes the times have changed and certainly so has her approach.


CROWLEY (voice-over): At the base of Clinton's $110 billion plan to revamp the health care industry is insurance for every man, woman and child in America.

SEN. HILLARY CLINTON, (D) PRESIDENTIAL CANDIDATE: Much like drivers in most states are required to purchase car insurance, all Americans will have a responsibility to get and keep health insurance in a system where insurance will now be affordable.

CROWLEY: Clinton would subsidize those who cannot afford premiums and limit insurance costs to a percentage of household income. Big business would have to provide health care coverage or pay into a government-run pool to defray the costs of those not covered. Insurance companies would be required to give coverage to anyone who applies and barred from charging the sick more than the healthy. This is the second go around for Clinton, whose health care proposal as first lady went down in flames. Critics said it was too complex, amounted to government run health care, and would do away with insurance for those already happy with their plans. She says she's learned something.

CLINTON: I know my Republican opponents will try to equate health care for all Americans with government run health care. Well, don't let them fool us again. This is not government run. There will be no new bureaucracies.

CROWLEY: Bingo on that one. Rudy Giuliani called it a scheme that includes more government mandates and more big bureaucracy. Mitt Romney said it was Washington health care born and bred.

MITT ROMNEY, (R) PRESIDENTIAL CANDIDATE: In her plan we have a government insurance instead of private insurance. In her plan it's crafted by Washington. It should be crafted by the states.

CROWLEY: No pass from her Democratic rivals either. Chris Dodd and Barack Obama said they were better suited to form the kind of bipartisan support needed to overhaul health care. And John Edwards hit her up for being too willing to compromise with the wrong people.

JOHN EDWARDS, (D) PRESIDENTIAL CANDIDATE: I don't believe you can sit down with lobbyists, take their money and cut a deal. If you defend a system that defeated health care, I don't think you can be the president who brings health care.

CROWLEY: In truth, all the Democratic candidates talk about universal health care. Clinton's plan is similar, though not identical to most of her Democratic rivals.


CROWLEY: As for that $110 billion price tag, Clinton says she will pay for it in part by cost savings in her plan and in part by a rollback of the Bush tax cuts in the upper income brackets. Wolf?

BLITZER: What's the major difference Candy between what she is proposing today and what she came up with back in 1993?

CROWLEY: Well, you know, in the totality of it, this is a proposal that would change the system from the inside out. Those, as you heard her say, who have health insurance that they like can keep that insurance. They can keep their doctors. They can keep the hospital they go to. The other plan, you know, more than a decade ago, was seen as just throwing the system out completely and building a new one. So this keeps the good parts of the old system and changes the bad parts as opposed to just throwing it all out.

BLITZER: Candy Crowley, watching this story for us. Candy, thanks. We want to compare and contrast Senator Clinton's plan with those from two of her Democratic rivals, the candidates Barack Obama and John Edwards. All three involve multibillion dollar annual plans. Clinton and Edwards' plan involve what are called individual mandates requiring everyone to have health insurance. Obama's plan does not require that. Clinton's plan requires large businesses to provide or help pay for employees' health insurance. Obama's plan would mandate employers who don't cover employees to pay into a national health insurance program. Edwards' plan requires employers to either provide health coverage or help defray their insurance costs.

Not having health insurance can be financially devastating, even dangerous, to your health. That's the message the American Cancer Society is trying to drive home in a new ad campaign it calls unprecedented. The group is devoting its entire $15 million advertising budget for this year. Commercials use actual cancer patients to raise awareness about the estimated 47 million Americans without health insurance. Critics charge the ads push a political agenda saying universal health care does not necessarily prolong the lives of cancer patients.

My next guest was in the United States senate when Hillary Clinton was the first lady and made her first attempt at health care reform. Our world affairs analyst William Cohen is here in THE SITUATION ROOM. You remember those days back in 1993. You were the senator from Maine, a Republican at the time. I remember the briefings we got at the White House from Ira Magaziner and other Clinton aides. It was so complicated, a thousand pages, I had a tough time understanding what she was trying to do then. I could barely explain to our viewers out there what was going on. But you had to deal with it legislatively.

WILLIAM COHEN, CNN WORLD AFFAIRS ANALYST: I did, and most all of us had to deal with it. It was very complicated, as you have said. If I could paraphrase thorough, our lives are cluttered with detail, we need to simplify, simplify. The system was so complicated that I think it lost credibility from the beginning. Apparently, she has learned a good lesson from that and now is trying to simplify it, make it much more comprehensible and comprehensive. So I think that she's stepping into the breach, we ought to give her credit for doing that, because health care is second only to the war in Iraq as the most pressing issue for the American people. You cannot have a country with 45 million people who don't have health insurance coverage. We have a two or three tier system. It's unfair. It's fundamentally unfair, and I think Republicans will join with Democrats to say we have to have universal coverage. The question is will it be government run or privately or a combination of private and government. That's the issue. I'm really not that familiar enough with the details of her proposal, but she ought to be given credit for offering it and being willing to take on the critics on both sides.

BLITZER: Because you travel all over the world obviously in Canada, but in Europe, where there is universal health care and virtually every major industrialized country and they look at the United States and they say 50 million Americans without health insurance? And even a lot of Americans who do have health insurance are not getting the kind of treatment, the kind of benefits that they need and deserve and the reaction around the world is one of why can't the United States get its act together and deal with this issue of health care for all Americans? COHEN: Well, as a matter of fact, one of the candidates I had to run against proposed simply on a bumper sticker, elect me and you will never get another bill from a hospital or doctor. And I had to run against that.

BLITZER: When you were running for re-election as a senator. COHEN: Exactly. I had to explain why our system was superior to the full payer system as such or single payer system. But in any event other countries are concerned, but Americans are concerned about it. This is something that we have to address. So we had to come up with a reformation of the current system. I have to confront it with my own family. I have a mother who has to contend with it, family members. Anyone who doesn't have a lawyer or someone, an advocate to help them, falls through into a wasteland of confusion. We have to reform the system and I think we have to examine this, compare it with Rudy Giuliani's, John Edwards, Mitt Romney's and others. But we have to do something.

BLITZER: I think everybody agrees it's time to get something done on this issue. Secretary Cohen, thanks for coming in.

COHEN: Pleasure to be with you.

BLITZER: Let's go to Jack Cafferty, he's in New York. Hi Jack.

JACK CAFFERTY: Wolf, Iran's president Mahmoud Ahmadinejad should not be allowed to address the U.N. general assembly here in New York City next week according to Republican presidential hopeful Mitt Romney. Romney says, "The Iranian regime under President Ahmadinejad has spoken openly about wiping Israel off the map, has fueled Hezbollah's terror campaign in the region and around the world, and defied the world community in its pursuit of nuclear weapons -- capabilities that make these threats even more ominous." Meanwhile, this comes while France, of all people, France, says the world should brace for war against Iran over its nuclear program. The French foreign minister is urging negotiations with Iran and stressed that war is not imminent, but he said that at the same time, quoting now, we have to prepare for the worst, and the worst is war, unquote. Iran's state run news agency responded saying that France's new government just wants to mimic the White House. For his part, Romney says the invitation for Ahmadinejad to speak at the U.N. should be withdrawn and instead he should be greeted with indictments when he lands here under the genocide convention. So here is the question -- should Iranian President Mahmoud Ahmadinejad be allowed to come into the United States and address the United Nations. E-mail your thoughts to or go to Wolf?

BLITZER: Good question to Jack. Thanks very much. I want to just alert our viewers to this important programming note. Please join Jack Cafferty this Wednesday, 8:00 p.m. eastern, right after THE SITUATION ROOM. He'll be doing a one hour special of "THE CAFFERTY FILE." You can go to where you can send in your i-Report sand you can email him at You're going to want to see "THE CAFFERTY FILE" for a full hour, 8:00 p.m. eastern Wednesday night. Is he the man to restore moral at the Justice Department? President Bush nominates a former federal judge to be the next attorney general. We're going to tell you about him and why some Democrats are very happy.

Some suggest President Bush picked his nominee to avoid a bitter fight with Democrats who control the senate. I'll ask the Republican Party chairman, the Florida Senator Mel Martinez about that and a lot more.

And John McCain says he won't try to get votes by playing up his religion, but we're going to tell you why many people are now talking about his faith. Stick around. You're in THE SITUATION ROOM.


BLITZER: For a Justice Department mired in controversy and low moral right now, many are hoping this is the man to change all that. He's Michael Mukasey. President Bush wants the retired federal judge to be his third attorney general. The president calls Mukasey a tough but fair-minded judge admired for his integrity. Let's go to our White House correspondent Ed Henry. He's watching this for us. All right, so what's the fallout? What's the reaction, Ed?

ED HENRY, CNN WHITE HOUSE CORRESPONDENT: Well Wolf, there's some private concern by conservatives but no full scale revolt and that's the good news for the White House for now. Republicans close to this White House say they don't think the president had the stomach for a big brawl with Democrats right now who run the senate, so he calculated that a middle of the road candidate would get some Democratic votes and that he could calm Republicans because Judge Mukasey is generally in agreement with the White House on key terrorism cases.


HENRY (voice-over): Eager to blunt conservative criticism, Judge Michael Mukasey is too moderate, President Bush focused nonstop on the war on terror.

BUSH: The attorney general has an especially vital role to play in a time of war. Some of Judge Mukasey's most important legal experience is in the area of national security.

HENRY: Such as presiding over the trial of the terrorist Omar Abdel Rahman, the blind sheik who plotted to blow up New York City landmarks.

BUSH: Judge Mukasey is clear-eyed about the threat our nation faces.

HENRY: And Judge Mukasey seemed right on message.

JUDGE MICHAEL MUKASEY, ATTORNEY GENERAL NOMINEE: 35 years ago our foreign adversaries saw widespread devastation as a deterrent. Today our fanatical enemies see it as a divine fulfillment. HENRY: But Mukasey's record suggests he will not necessarily march in lockstep with Mr. Bush. As a federal judge, he twice ruled terror suspect Jose Padilla was entitled to legal representation which ran counter to what the Bush Justice Department argued.

BARUCH WEISS, FORMER FEDERAL PROSECUTOR: This is a man of independence and a man of integrity, and the Bush administration knows that and they want somebody who is confirmable.

HENRY: Key for a president with shrinking political clout. In desperate need to show he's serious about turning the page from the controversial tenure of Alberto Gonzales with Mukasey.

BUSH: He knows what it takes to fight this war effectively, and he knows how to do it in a manner that's consistent with our laws and our constitution.

HENRY: To be sure though, Mr. Bush expressed no regrets about how Gonzales handled anti-terror tools like the domestic surveillance program or the patriot act.

BUSH: This honorable and decent man has served with distinction.


HENRY: Now, this is also a sign of the president moving outside his inner circle of loyalists for top jobs. He did it with Bob Gates as defense secretary, Ed Gillespie as White House counselor. Republicans outside this White House are happy. They just wish the president had done it a bit sooner. Wolf?

BLITZER: What is the White House doing Ed about a potential backlash from some conservatives?

HENRY: Well they have Judge Mukasey yesterday to meet mostly one-on-one meetings with conservative activists. The White House feels good that when these conservatives meet him one-on-one personally, he wins them over. Wolf?

BLITZER: Ed Henry at the White House, thanks.

Now some Democrats clearly pleased with the president's pick. Let's go to our congressional correspondent Dana Bash, she's watching the initial reaction coming from the hill. Dana, what is it?

DANA BASH, CNN CONGRESSIONAL CORRESPONDENT: Well you know conservative activists as Ed was just saying, may be disappointed that the president didn't choose somebody with tried and true conservative credentials, but so far no Republican senator who actually has a vote has complained. And as for Democrats, the White House got exactly what they wanted, praise.


BASH (voice-over): Something you don't hear much from Democrats, especially their chief partisan gunslinger. SEN. CHARLES SCHUMER, (D) JUDICIARY COMMITTEE: The very nomination of Judge Mukasey, wherever it comes down at the end of the day, shows a change in attitude, and I think that is very, very good for the country.

BASH: Democrats who were gearing up for a fight found themselves praising both the president and his choice for attorney general.

SCHUMER: Judge Mukasey is not a crony of the president. He is not a White House insider. That's a good sign.

BASH: But Democrats also called the president's pick someone they recommended a vivid sign of Mr. Bush's political weakness, and Democrats cautioned there will be no coronation. The senate judiciary chairman raised the possibility of delaying confirmation hearings for Mukasey until the administration turns over information and testimony congress has been demanding about fired federal prosecutors and warrantless wiretapping.

SEN. PATRICK LEAHY, (D) JUDICIARY COMMITTEE: As I told the White House last night, I stand ready to work with them in the coming weeks to get the material we need. And then once that material is available, to find an appropriate time to schedule a hearing.

BASH: The judiciary chairman's top Republican supports democrats' demand for documents about controversial White House decisions, but he warned against stalling on a new attorney general.

SEN. ARLEN SPECTER, (R) JUDICIARY COMMITTEE: Those are all very, very important matters, but I don't think they are as important as what's happening in justice day in and day out today.

BASH: Democrat Chuck Schumer agreed.

SCHUMER: The new attitude of the White House shown by the Mukasey nomination means that confrontation should not be in the front of anybody's mind right now.


BASH: Now, Democrats are eager to point out what they see as the president's concession to political reality, but they also know, Wolf, that congress' approval ratings are incredibly low, too. So by Democrats sort of going along with this, at least reaching out to the White House as they see it or the White House reaching out to them, they know that helps send the message to voters who are disappointed with the way Washington is working, that they can try to take a time- out from the partisanship as well.

BLITZER: Dana Bash on the hill for us. Thank you.

Let's take a little closer look now at what some of the presidential candidates are saying about the president's pick. On the Republican side Rudy Giuliani says, and I'm quoting now, "The president could not have picked a person with greater integrity than Michael Mukasey to be the next attorney general. As in everything Michael does, he will meet and exceed all expectations in his new role." Mitt Romney says and I'm quoting, "I welcome the president's choice of Michael Mukasey for the position of attorney general and hope the senate will give this distinguished jurist the respect and consideration he deserves." As for the Democrats, Hillary Clinton says, and I'm quoting, "It is my hope that during his confirmation hearings Judge Mukasey demonstrates that he will continue his years of able public service to restore these principles to the Department of Justice." And Joe Biden, a member of the judiciary committee says, "The key test for me is will Judge Mukasey understand that as attorney general he's the people's lawyer, not the president's lawyer."

Still ahead, the vice president of the United States, Dick Cheney, weighing in on the controversy involving that ad from You will hear about his harsh reaction. That's coming up in our strategy session.

And Democrats are hungry to put a firmer grip on the senate. More Republicans are vulnerable in next year's elections than Democrats. I'll ask the Republican Party Chairman Mel Martinez about his party's strategy to try to protect their seats. That and a lot more coming up right here in THE SITUATION ROOM.


BLITZER: Our Carol Costello is standing by with a closer look at some other incoming stories making news. Hi Carol.

CAROL COSTELLO: Hi Wolf, hello to all of you. General Motors and the United Auto Workers are back at the bargaining table. Union leaders and GM management have been holding marathon bargaining sessions. They're trying to agree on a critical labor contract and avoid what could be a crippling strike. Local union leaders say negotiators are making progress. Thousands of union workers went to work this morning even though their contract officially expired on Friday.

Behind bars and so far denied bail, O.J. Simpson, the former football star is charged with robbing two sports memorabilia sellers in a Las Vegas hotel room last week. His arraignment is set for Wednesday, and a bail hearing will be held after that. Simpson attorney says he hopes to get his client released before Wednesday insisting Simpson is innocent of all charges.

A settlement has been reached in the contentious dispute between hurricane Katrina victims and State Farm Insurance Company. Over 100 State Farm customers in Mississippi challenged the insurance company for refusing to cover hurricane damage to their homes. Attorneys for the homeowners would not reveal terms of the new settlement, but they did say the deal proved small individuals can stand up to large insurance companies.

And take a look at this. It's a cornfield and it's a home grown tribute to the late Gerald Ford. A Michigan farm right near where the late president grew up created a corn maze in Ford's likeness. The farm makes a maze every year in its corn fields and decided this year to honor the 38th president. As you know, Ford died late last year. Pretty cool, huh, Wolf?

BLITZER: Very cool, very nice indeed. Thanks very much Carol for that.

Still ahead, tough times for the GOP. From political fallout from the war in Iraq to recent retirements in the U.S. Senate. We're going to talk about that a lot more. The critical challenges facing the Republican Party. Senator Mel Martinez, the chairman of the Republican National Committee, he's standing by live.

And Senator John McCain, he's now speaking out about his religion. He was raised as an Episcopalian, he's now a Baptist. When and why did he convert? All that and a lot more coming up right here in THE SITUATION ROOM.


BLITZER: Happening now, the security firm that protects American diplomats in Iraq is losing its license in Iraq after a shootout in Baghdad that left eight civilians dead. We're going to find out what's happened there. That's coming up.

Also, the moments leading up to that deadly jet crash in Thailand caught on camera. Americans are among the dead. We're going to talk to some of the passengers who survived that harrowing ordeal.

And candid words from former Fed chairman Alan Greenspan. He talks about the crisis in the housing market and our past and current political leaders. CNN's Mary Snow standing by with a full report. We'll also debate Greenspan's views, that's coming up in our "Strategy Session." I'm Wolf Blitzer, you're in THE SITUATION ROOM.

Right now, Democrats in the Senate have one thing they want, but they're hoping for more, more seats, that is, to put a firmer grip on their control of that chamber. The way the numbers stack up right now, many Republican seats are very vulnerable.

Let's talk about that and more with the Republican Party chairman, the senator from the state of Florida, Mel Martinez.

Senator, thanks for coming in.


BLITZER: A lot of people, especially Republicans, are nervous right now. What, there are 21 Republican seats that are up for grabs in 2008, 12 Democratic seats, a lot of vulnerability. The Democrats have a 51-49 majority right now. How worried are you that that majority could expand?

MARTINEZ: Well, it's a challenging cycle, no doubt about it.

The numbers are just not with us. But, at the same time, we have an awful lot of good candidates that are emerging. And, in spite of some retirements of some seats that would have been sure things, the fact is that we feel good about the crop of candidates we have.

What we have to do is present our case. You know, the Democrats in Congress have now the lowest approval rating in the history of the Congress. The fact is that they haven't governed. And, even on the issue of the attorney general today, which seems to be a consensus candidate, what we're hearing is more government by investigations, rather than getting the things done that the American people want. So...

BLITZER: It's not just the -- it's not just the Democrats who have a horrible approval rating in the U.S. Congress. It's all the members of Congress, the Republicans as well.

But let's take a look at some of the recent seats. For example, in Virginia, with John Warner announcing he's retiring, Mark Warner, no relation, a popular former governor, he would seem to have a pretty good shot of picking up a Democratic seat.

Even in Nebraska, if you take a look at Chuck Hagel, the Republican from Nebraska, he's retiring, but, if Bob Kerrey, the former Democratic senator, comes back to Nebraska to run, there's -- there's potential -- there's a couple pickups right there. Wayne Allard in Colorado, he's vulnerable as well.

MARTINEZ: Well, in Colorado, we have a great candidate in Bob Schaffer. He is someone that is gaining a lot of traction.

And, frankly, I believe, at the end of the day, Wolf, it's not only about the personalities that are running, but it's about the candidates and their positions on the issues. And I think the Republican Party still can connect with the American voters in all of those states. I think Nebraska is one -- a state where we should win that state. Virginia has been a little tougher of late.

BLITZER: What if Bob Kerrey comes -- what if Bob Kerrey comes back home?

MARTINEZ: Well, he's yesterday's news. The future is about the people who are emerging there. We have some very popular candidates that are in statewide office that are considering that seat. So, I would relinquish nothing there. It's still a long 14 months between now and the election. A lot can happen.

BLITZER: There's...

MARTINEZ: A lot can happen.

BLITZER: There are some -- there are some other incumbent Republicans who are seeking reelection who are vulnerable, widely seen as vulnerable, as well, Susan Collins in Maine, Norm -- Norm Coleman of Minnesota, Gordon Smith of Oregon, John Sununu of New Hampshire. They -- they face enormous, enormous challenges from Democrats.

MARTINEZ: Well, those are tough states, no doubt, but I wouldn't bet against any one of those four people. They're great senators. The people in their state have gotten to know them and what kind of senators they are, the fact that they can deliver. So, I wouldn't count -- bet against any of those four. The fact is, I also believe that, once we identify a nominee and a new nominee of our party begins to emerge, I think there will be a lot of enthusiasm.

And, plus, Wolf, we also have the opportunity for Democrats to continue to misgovern, to continue to fail the test of leadership, which is to get done the things that the American people are desperate to get done. We have a lot on the agenda, and there's a lot of incompletes on the agenda of that this congressional leadership has given us so far.

BLITZER: Some -- some analysts suggesting today the president blinked in his nominee for the attorney general. He didn't go for Ted Olson, a former solicitor general. He didn't go for Michael Chertoff, the secretary of homeland security, because they would have been controversial, especially with Democrats.

He picked someone that Chuck Schumer actually had recommended for the -- for the U.S. Supreme Court. Did the president blink in the face of that pressure?

MARTINEZ: Well, it just shows you that the president will get blamed one way or the other. The fact is, he's come up with a consensus candidate, someone who, first of all, is impeccably qualified to be attorney general, 18 years as a federal judge, the kinds of credentials, the kinds of recommendations from people who know him that are sterling and that are, you know, gold-plated, if you will.

But, in addition to that, Wolf, he also brings to the position of attorney general something that is very important right now, which is his knowledge and -- and the work that he has done in cases involving national security. The most important thing that this -- the Senate now needs to do is to confirm this nominee, so we can get on to the business of revising the FISA law, which, as you know, is the Foreign Intelligence Surveillance Act, something that we desperately need to continue to put the bad guys away and keep America safe.

BLITZER: Let me ask you a question about Cuba, a subject close to your heart.


BLITZER: ... close to the heart of a lot of Floridians, especially down in South Florida, in the Miami area.

Last week, Fidel Castro had this rambling editorial that was read on Cuban television, suggesting that it wasn't a plane, American Airlines Flight 77, that crashed into the Pentagon on 9/11. It was really a projectile or a missile, suggesting the -- the U.S. government may have been involved in that.

I spoke to Ricardo Alarcon the next day, the number-three official in Cuba, the president of the Cuban National Assembly. And he said, well, Castro was just reflecting some -- some opinions that had been out there.

But what does this suggest to you about Fidel Castro's state of his mind right now? We haven't seen him in more than a year. Obviously, he's quite ill.

MARTINEZ: Well, he's obviously quite ill and he's obviously lost his mind.

For a long time, I have wondered what was inside that head of his. And now we know that there isn't much there. The fact is that the Cuban people deserve better than an aging dictator handing power to his aging dictator brother. And I hope that the Cuban people can soon breathe a sigh of freedom and democracy.

You know, Wolf, for a long time, I have quit listening to what Fidel Castro says. He doesn't have much good to say.


BLITZER: Do you think Raul Castro, his brother, would be any better?

MARTINEZ: Of course not, no.

Anybody who is a -- an avowed totalitarian dictator, who believes in an iron fist, I just don't think is the right thing for any -- any people. The people of Cuba have suffered under almost a half-a- century of dictatorship. It really is time for them to be able to breathe the fresh air of democracy.

The opportunities that it would bring to the Cuban people would be tremendous. And I really do hope that -- that the future that approaches in fact will be better for the Cuban people.

BLITZER: Senator Martinez, thanks for coming into THE SITUATION ROOM.

MARTINEZ: Good to see you, Wolf.

BLITZER: Thank you.

And still ahead, the vice president, Dick Cheney, he had some harsh reaction to that ad that criticized General David Petraeus. We are going to tell you how Cheney blasts That's coming up in our "Strategy Session."

And Alan Greenspan says the Iraq war is all about oil, and that the Republican Party deserved to lose control of Congress last year.

That's also coming up in our "Strategy Session."

We will be right back.


BLITZER: Is he a Baptist or is he an Episcopalian? That's the question some people are asking about Senator John McCain.

Let's go to CNN's Tom Foreman. He's here in THE SITUATION ROOM. He's watching this.

So, what's the answer?


TOM FOREMAN, CNN CORRESPONDENT: Well, the answer is, this is -- this is a nutty story here, but the answer is, both.


SEN. JOHN MCCAIN (R-AZ), PRESIDENTIAL CANDIDATE: There has been some talk about my religious persuasion.

FOREMAN (voice-over): John McCain in South Carolina referring to an Associated Press article this weekend that has some people talking. The senator from Arizona and Republican presidential hopeful told the AP that he was a Baptist, but Episcopalian is the faith listed in his biography in the latest guide of members of Congress and in the most recent edition of "Almanac of American Politics."

And, in an interview with McClatchy newspapers in June, McCain said he still called himself an Episcopalian.

We ask him about his faith.

MCCAIN: I was raised in the Episcopal Church and attended high school at a high school called the Episcopal High School. I have attended North Phoenix Baptist Church for many years. And the most important thing is that I am a Christian. And I don't have anything else to say about the issue.

FOREMAN: McCain says his wife and two of their children have been baptized in the Baptist Church they attend, but that he has not, telling AP, "I don't find it necessary to do so for my spiritual needs."

McCain's campaign says none of this is new, and that the issue was given a thorough vetting when McCain first ran for president in 2000. McCain says religion plays a role in his life, but he said for years that he doesn't advertise his faith.

MCCAIN: My religious belief is clear. I am a man of faith, but I also have to tell you that I believe that my relationship with God is a private one. And I am not ashamed of my religious beliefs or my faith, but, at the same time, I believe that that relationship is generally a private one.


FOREMAN: The only reason this is getting any headlines is where he made these comments. He did it in South Carolina. That holds the first Southern primary. It's a state dominated by Baptists. So, some people are saying he's pandering with this, trying to get votes. But McCain says he was Baptist the last time he ran for president, and it didn't help then, because then Governor George Bush defeated McCain in the South Carolina primary.

Wolf, as we would say on "Raw Politics," this kind of has the smack of a cheap shot. It's not like he said he was a devil worshiper. Like a lot of families, people have different influences of different faiths. And McCain is explaining it away, but explaining it well.

BLITZER: And he says he's a man of faith...

FOREMAN: Exactly.

BLITZER: ... and he's a Christian.

All right, thanks very much, Tom Foreman.

We have been looking at membership numbers for both the Episcopalian and Baptist churches. The Episcopal Church has some 2.4 million members in the United States. It ordains both women and homosexuals into priesthood and believes that marriage is between a man and a woman, but some diocese perform same-sex blessings.

Meanwhile, the Baptist Church has more than 30 million members in the United States. Many Baptist churches in the U.S. ordain women, but southern Baptists do not. And the Baptist Church opposes same-sex marriage because they consider homosexuality to be a sin.

Vice President Cheney weighs in on the ad that criticized General David Petraeus.


RICHARD B. CHENEY, VICE PRESIDENT OF THE UNITED STATES: It's bad enough when politicians turn their backs on a war they voted for and supported when it was popular. But no one in politics, regardless of party, should hesitate to object when an American soldier at war is mocked and insulted.


BLITZER: Should those in uniform be held above politics?

Also, Alan Greenspan says his Grand Old Party lost its way and deserved to lose in 2006. Will 2008 be a replay? We will talk about that and more.

Paul Begala and J.C. Watts, they are standing by live for our "Strategy Session" -- right here in THE SITUATION ROOM.


BLITZER: Vice President Dick Cheney speaking out about that controversial ad by, and the former Fed chairman, Alan Greenspan, has a lot of interesting and controversial things to say on a number of issues, all of which we're going to talk about in today's "Strategy Session."

With me, CNN political analyst and Democratic strategist Paul Begala, and Republican strategist, J.C. Watts, a former member of Congress.

Guys, thanks very much for coming in.

Alan Greenspan, we could never understand what he was saying when he was the Federal Reserve chairman, but now he's speaking bluntly in his new book, "The Age of Turbulence."

He says: "The Republicans in Congress lost their way," J.C. "They swapped principle for power. They ended with neither. They deserved to lose" -- this from a lifelong Republican, who says that the spending under the first six years of the Bush administration was simply out of control.

J.C. WATTS, CNN POLITICAL ANALYST: Wolf, I think there's some merit to this. I think he's right on. I think there's Republican members of Congress that would tell you the same thing.

You know, my father used to say, if you keep walking down a bear trail, pretty soon, you're going to run up on a bear. And I think Republicans did that for four or five years. November of 2006, they paid the price.

Alan Greenspan said, the American people didn't vote for Democrats. They voted against Republicans. I said that the night of the election. So, again, I think many Republicans agree with that.

BLITZER: And -- and it wasn't just the Republicans. He named names, Dennis Hastert, the former speaker, Tom DeLay, the former majority leader.

And -- and, as -- as tough as he was on the Republicans, he was glowing as far as Bill Clinton, your former boss, was concerned, saying that this guy was -- was brilliant, despite the -- the lapse during the Monica Lewinsky matter.

PAUL BEGALA, CNN POLITICAL ANALYST: Right. Well, I think he said in the book that he found in Clinton a fellow policy wonk, somebody who was grounded in reality.

And, you know, that was a painful time for Bill Clinton, because he had to go against his political advisers when he raised taxes on the rich.


BLITZER: Were you one of those?

BEGALA: I was one of the advisers who begged him not to raise taxes on the gas tax, particularly. That was not on the rich. That was on the middle class. And I hated that.

But Clinton decided to go with Bob Rubin, Lloyd Bentsen, then the treasury secretary, and Greenspan, and people who were advising him that this would be the best thing for the economy, even though it would be bad politically.

Now, I said it would be bad politically. I happened to be right. I just wasn't very happy about it. Rubin, Bentsen, Greenspan, the rest of them, were right about the economics. And I do think it says a lot when a president puts what he thinks is good for the country over what is good for him politically. That's what Clinton did in an economic plan.


BLITZER: Another controversial thing he writes in the book involves the war in Iraq.

Listen to this, J.C. He says, Greenspan: "I am saddened that it is politically inconvenient to acknowledge what everyone knows: The Iraq war is largely about oil."

WATTS: Well, and I read today where the chairman was trying to explain himself, and he said that he said to the White House that this would affect the global economy, because the price of oil obviously would go up, and people at home would be paying $5, $6 a gallon for fuel.

And, Wolf, I think we're kidding ourselves and naive to think that oil didn't have -- didn't play a role in it. I don't think the president made a decision to say, we're going to go fight for oil, but I think, you know, that was kind of a subtext or kind of something that you had to factor into it because of what it would do to the world economy.

BLITZER: If the president was hoping the price of oil would go down as a result of the liberation of Iraq, he obviously is wrong. It's now approaching $80 a barrel...

BEGALA: Right.

BLITZER: ... what -- twice of what it was when the U.S. went into Iraq.

BEGALA: But, of course, he was wrong about everything else going into this.

But, you know, I talk a lot about how Bush was wrong. Apparently -- and this is hard for me to say -- it's not what I do for a living -- apparently, I was wrong, too. You know, I used to host that goofy show "CROSSFIRE," screaming and yelling, foaming at the mouth about how I didn't like Bush about anything, but I never once said that the Iraq war was about oil. I couldn't bring myself to imagine that or believe that.

In fact, many times, I dismissed that view, saying, well, that's the kook left, not people like me who are closer to the center. Well, Alan Greenspan ain't the kook left. He ain't Michael Moore. He ain't MoveOn. In fact, he is a guy who now shows that Michael Moore, MoveOn and the rest of them were in the center. By the way, never said this was a war about oil either.

Alan Greenspan has known Dick Cheney and Donald Rumsfeld probably longer and better than almost anybody. And with -- as you point out, with remarkable clarity, those seven words, he says, the Iraq war was largely about oil.

This is the most damning indictment...

WATTS: Well...

BEGALA: ... and betrayal that Mr. Bush could have occurred -- could have committed.

WATTS: Well, but the chairman, you know, he's a bit confusing, because, again, today I -- I wrote -- I mean, I read...


BLITZER: He's clarifying his remarks.


BLITZER: He was on "The Today Show" this morning. And he's suggesting it -- it wasn't as blunt as the words he wrote in his book.

WATTS: Exactly.

And, usually, as Chairman Barney Frank said, when people say, well, they -- they misinterpreted what I said, they're usually meaning, I wish I wouldn't have said that, because I -- it wasn't -- it wasn't a war about oil, but to say that oil didn't factor into it, in terms of the world economy, the global economy, is just nonsense. And that's what the chairman...


BLITZER: It's one of the reasons that part of the world is important. There's a lot of oil.

Hold on one second here, because I want to -- speaking about Dick Cheney, I want to play a clip of what he said today, because he's now weighing in on that ad that questioned General Petraeus. Remember, the "General Betray Us.

Listen to Cheney.


CHENEY: It's bad enough when politicians turn their backs on a war they voted for and supported when it was popular. But no one in politics, regardless of party, should hesitate to object when an American soldier at war is mocked and insulted.



BLITZER: All right, Paul.

BEGALA: God bless Dick Cheney. I mean, how great is that for, right?

They were taking heat from some Democrats, independents, editorial pages. And now the focus of their criticism is Dick Cheney, who, in the minds of most Americans -- not even just Democrats -- is a moral midget.

He says it's wrong to attack a man about his war service. At his convention in 2004 in New York City -- we were there -- Republicans were wearing Band-Aids with Purple Hearts on them to mock John Kerry's heroism in war. Three times, Kerry shed blood for our country. Cheney and them were mocking that.

They said that Max Cleland, a war hero, lacked courage. They said that Tom Daschle, an Air Force veteran, was portrayed in ads with Saddam Hussein. They have gone right after the war heroism of a variety of heroes. All MoveOn said was that Petraeus was sometimes political, which he is.


BEGALA: MoveOn was right.

WATTS: See, unlike Paul, I'm not going to try to defend Republicans or Democrats. I think, any time it's done, it's wrong. Republicans shouldn't do it. Democrats shouldn't do it.

Here is a man that took this assignment. He was voted on by the United States Senate unanimously -- not one senator voted against him -- to go and take this assignment to try to get things on the right track, trending in the right direction. He has got a son there. He called it his home.

And then is saying "General Betray Us." I -- I think -- John McCain said, the worst insult you can give to a soldier is to say you're betraying your country. I think it was abysmal, what they did.


BEGALA: But McCain has standing to say that.


BEGALA: I'm just saying, as a -- as strategist, not a Democrat or as a Republican, I would want McCain out there hitting MoveOn, because McCain is a war hero.

WATTS: Well...

BEGALA: But Dick Cheney had five draft deferments. He's a coward. He has no right to speak about military things.

BLITZER: All right.


WATTS: What about you and I saying it? Why don't you and I say that it's wrong?, they were wrong for doing that. If Republicans do it, they're wrong. We shouldn't be sitting here saying if it's right for Republicans or Democrats to do it. It's wrong for both of them to do it.

BEGALA: It just seems it's only wrong when the progressives do it.


BLITZER: Paul Begala and J.C. Watts, in our "Strategy Session," thanks, guys, for coming in.


BLITZER: Still to come: stories of fear, destruction, and incredible heroism -- the aftermath of that deadly crash that left an airliner broken in two.

Plus, France -- yes, France -- vocal against the war in Iraq, but, tonight, we're hearing some very, very different words, tough talk from French leaders about another nation. You might be surprised what French leaders are now saying about Iran.

Stick around. You're in THE SITUATION ROOM.


BLITZER: Let's check back with Jack Cafferty for "The Cafferty File" -- Jack.

JACK CAFFERTY, CNN ANCHOR: The question is, should Iranian President Mahmoud Ahmadinejad be allowed to come into the United States to address the U.N. next week? Mitt Romney doesn't think we ought to let him in the country.

John in Pittsburgh says: Sure, Jack, why not? Just because we might be embarrassed that the nut job Iranian might be more persuasive and a better speaker than the nut job we have for president is no reason to bar him. Besides, the U.S. doesn't have jurisdiction over such decisions."

Laurinda writes in New York: "No way. He's a terrorist. Personally, I think that the United States should be out of the United Nations and the United Nations should be out of the United States."

Harold in Florida: "I don't understand the question. The president of Iran hasn't invaded any country and killed thousands of their civilians. Maybe it's Bush who shouldn't be allowed to come to the U.N." Dan in Florida: "What, did Iran not pay the French for their nuclear equipment? That's the only scenario I can imagine that would have France up in arms -- pun intended -- over this. As far as Iran's president addressing the U.N., of course he should be able to. We go through this nonsense whenever someone who is running for office wants to look tough on fill in the blank."

Art in West Virginia: "Ahmadinejad wouldn't be the first madman to address that august body, but he's not a person that the free world should be encouraging. He deserves to be derided and ostracized for his hateful comments."

Dave in Brooklyn writes: "The U.N. is not in the United States. You should know that."

I do know that.

"The land it's on is only surrounded by U.S. territory. So, he has every right to address the U.N. without asking us. To answer your question, though, I would not allow him on U.S. soil. If he wants to go to the U.N., they should fly him over the building and drop him out of an airplane. If he survives that, then let the U.N. deal with him."

We invite to join us Wednesday at 8:00 Eastern for a special one- hour edition of "The Cafferty File," talking about just how ugly it's getting out there. Whoopi Goldberg is a guest. You can go to You can send us I-Reports. You can go to Jack@ -- you can e-mail us at -- Wolf.

BLITZER: How is the new book, "It's Getting Ugly Out There," Jack, doing?

CAFFERTY: Doing all right, last I looked.

BLITZER: That's a good book. And I recommend it to our viewers.

CAFFERTY: Thanks, Wolf.

BLITZER: Thanks, Jack. We will check back with you in a few moments.