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THE SITUATION ROOM

O.J. Simpson Released From Vegas Jail; Dems Suffer Setback on Iraq; Interview With Governor Bill Richardson

Aired September 19, 2007 - 16:00   ET

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


WOLF BLITZER, CNN ANCHOR: Happening now, O.J. Simpson a free man, at last for now. The one-time murder defendant can now fight armed robbery and kidnapping charges from the other side of a jail cell.
Democrats suffer a stinging setback on what may be their best chance to force change in Iraq. Virginia's senior senator snatches back his support of a plan from Virginia's junior senator.

And rare criticism of President Bush from a Republican who hopes to replace him. In a CNN exclusive, Rudy Giuliani outlines what he calls significant mistakes and what lessons they should teach the next administration.

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

Within the past hour new developments in Las Vegas reminiscent to a certain degree of the notorious 1994 slow-speed chase. A car carrying O.J. Simpson being trailed by TV crews and helicopters. Simpson is now out of jail, expected to head back to Florida sometime soon. He's facing charges of kidnapping, armed robbery, and assault, but earlier today a judge allowed him to post bail.

Let's go out to Las Vegas.

Ed Lavandera is standing outside the courthouse. He has got lots of company out there as well.

All right. Update our viewers who are just tuning in, Ed, what happened today.

ED LAVANDERA, CNN CORRESPONDENT: Well, that court hearing that O.J. Simpson had been anticipating since he was arrested Sunday morning took place this morning here in Las Vegas, and a judge allowing that O.J. Simpson post a $125,000 bond so that he could be released while the legal case here and the criminal charges continue to move forward.

A couple of conditions upon that release. O.J. Simpson is not allowed to travel outside the U.S. He's had to turn over his passport. He's also been ordered not to have any contact with the witnesses, the victims, or any of the co-defendants that he's been charged with so far. There are three other men that have been charged with him as well.

And just a short while ago, O.J. Simpson processed out of the Las Vegas jail here wearing a light blue suit and a white shirt. He was whisked away in a car driven by his attorney. And we presume he's headed toward the airport. He lives in Miami now, and we presume he'll be headed that way shortly.

BLITZER: Ed, there's no need for him -- I take it the judge did not impose an ankle bracelet or anything along those lines to watch where he is. He's a free man for all practical purposes. He can travel anyplace in the United States.

LAVANDERA: Right. There was no talk this morning of any kind of ankle bracelet. I assume one of the arguments that his attorney made to the judge in this case is that, look, he's O.J. Simpson, there's virtually no place in the U.S. that he can hide. Everyone knows what he looks like.

BLITZER: And there's going to be another sort of preliminary hearing at the end of October, but probably no formal court proceedings until next year, is that right?

LAVANDERA: Yes. His attorney, O.J. Simpson attorney, had spoken with reporters afterward and he said that this will probably be -- could be a very long process taking several months. And we anticipate that that might have a lot to do with the fact that O.J. Simpson's attorneys will begin negotiations perhaps with prosecutors here in Las Vegas, and I anticipate many twists and turns to this case as it moves forward.

BLITZER: All right, Ed. Thanks very much.

Jeff Toobin, our senior legal analyst, he's going to be joining us later here in THE SITUATION ROOM. We'll get some more legal analysis. But let's turn to some other important news we're following right now.

Rudy Giuliani wants you to know about the stamps on his passport. In an exclusive interview with CNN, the Republican presidential candidate says the past few years he's traveled to Europe, Asia, and Africa more than anyone running for president. Today he's in London for meetings with the new British prime minister, Gordon Brown, and others. In between, he sat down with CNN's John King and offered some very rare criticism of President Bush.

(BEGIN VIDEO CLIP)

JOHN KING, CNN CHIEF NATIONAL CORRESPONDENT: Is this summary fair? If you read your writings and look at your campaign speeches and listen to you, it sounds like Rudy Giuliani is saying the president is right when he talks about preemption and the president is right when he talks about standing up to this terrorist threat. The implementation though has been at times far less than competent.

RUDY GIULIANI (R) PRESIDENTIAL CANDIDATE: Yes, I'd probably put it in a more generous way. I would say that the goals are correct. The goals in many ways are historic.

The idea of turning around our ship of state on September 20, 2001, to me, was quite an accomplishment by President Bush. We were an America that was seriously on defense against Islamic terrorism. We turned it around to be an America that's on offense. I think that's helped keep us safe.

Have there been significant mistakes made along the way? Absolutely. And should we learn from them in the next administration as this administration has already done? Should we change things based on those mistakes? Yes.

(END VIDEO CLIP)

BLITZER: Giuliani also talked about the liberal group MoveOn.org and how that group's efforts against him actually might help him get nominated. He also answers some criticisms about how much time he actually spent at Ground Zero after 9/11.

Much more of this interview. Rudy Giuliani speaks to our John King. That's coming up shortly here in THE SITUATION ROOM.

Also going on today, Democrats devastated apparently by one senator's reversal of opinion that could have major implications. It involves Iraq and a plan to force a change in the administration's war policy.

Our congressional correspondent, Dana Bash, is on Capitol Hill -- Dana.

DANA BASH, CNN CONGRESSIONAL CORRESPONDENT: Wolf, Jim Webb thought he was closing in on having enough votes to pass the Democrats' best hope for Iraq legislation, but he was dealt a big blow, one that hit close to home.

(BEGIN VIDEOTAPE)

BASH (voice over): Virginia Democrat Jim Webb's efforts to limit tours of duties in Iraq suffered a major setback. The other senator from Virginia changed his mind.

SEN. JOHN WARNER (R), VIRGINIA: I endorsed it. I intend to now cast a vote against it.

BASH: GOP senator John Warner gave several reasons for his reversal, like a full-court press from Pentagon officials, including this meeting with three-star generals earlier in the day.

WARNER: They have now convinced me that they cannot effectively put into force that amendment at this time without causing severe problems within the existing forces and those that are serving there.

BASH: Webb's legislation would mandate troops spend as much time at home as on the battlefield.

SEN. JIM WEBB (D), VIRGINIA: It's time that we put into place operational policies that sensibly take care of the people we are calling upon to go again and again. BASH: Democrats who lack votes to pass a timeline for troop withdrawal have seen Webb's measure as their best chance at forcing a change in Iraq policy because it would limit the number of troops available to deploy. But several undecided GOP senators tell CNN the White House and Pentagon have lobbied them hard to vote no, saying it would break up military units and reduce combat effectiveness.

It worked with Tennessee Republican Bob Corker. After multiple meetings with Pentagon officials, he decided to vote against Senator Webb's measure.

SEN. BOB CORKER (R), TENNESSEE: I have a lot of respect for him and have been open to it certainly. But when you look at, again, the operational aspects of what it would truly do, it's just not -- it's just not something that would be good for our country.

(END VIDEOTAPE)

BASH: Talk to Republican senators here and they admit it is very hard to vote against a measure giving troops rest, especially since many hear from their constituents in the military about the strain they feel from multiple tours of duty. That's why senators John McCain and Lindsey Graham are offering a Republican alternative, a symbolic measure to say they support the troops -- Wolf.

BLITZER: All right, Dana. Thanks very much.

Dana Bash on the Hill.

At the same time, President Bush today trying to stave off any more Republican defections regarding support for his Iraq plan.

Our White House correspondent, Suzanne Malveaux, is standing by.

Suzanne, the president spent some time calling for unity on two fronts. Tell our viewers what's going on.

SUZANNE MALVEAUX, CNN WHITE HOUSE CORRESPONDENT: Well, Wolf, as a matter of fact, as we speak, the leadership in the Democratic Party both in the House and Senate side are meeting with the president in the residence to talk about two critical issues. One, of course, is trying to keep their support when it comes to the war in Iraq.

The president trying to shore up their support essentially to make sure that there is no legislation that they sign off on that Democrats are proposing that might take away his power to execute the war. One of those pieces of legislation that Dana had mentioned from Jim Webb which would say, OK, 15 months on duty, 15 months off duty. That is something that the president believes will tie his hands, as well as the military commanders believe the same.

So that is one of the things they're trying to make sure that they don't basically defect to the other side -- Wolf.

BLITZER: What about the president's latest comments on the warrantless wiretap program? Give our viewers a sense what he's talking about today.

MALVEAUX: Well, certainly that's the other critical issue here, and that is whether or not in six months or so this legislation that was passed by Congress is going to be made permanent allowing those warrantless wiretapping programs to go forward with broad authorization and powers by this administration. It was passed very quickly before the recess.

There are some Democrats who are quite worried that it violates civil liberties of Americans. We saw President Bush today at the National Security Agency today making the case, however, that this is about national security, and that he must have this key legislation in place in six months.

(BEGIN VIDEO CLIP)

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: This law has helped close a critical intelligence gap allowing us to collect important foreign intelligence and information about terrorist plots. The problem is the law expires on February 1st. That's 135 days from today. The threat from al Qaeda is not going to expire in 135 days.

So I call on the Congress to make the Protect America Act permanent.

(END VIDEO CLIP)

MALVEAUX: And obviously the president is trying to get ahead of this debate, or at least in the debate. There are hearings that are going on Capitol Hill yesterday, as well as tomorrow. Once again, it doesn't happen until six months or so, but he wants to put it on the agenda and to push hard now to make sure that that happens.

We already have reaction. Senator Dianne Feinstein, member of the Senate Intelligence and Judiciary committees, saying today, "I agree that it's vitally important to our intelligence agencies to be provided the tools they need to protect Americans lives," but she goes on to say, "It's equally important that the rights and liberties of all-Americans are protected" -- Wolf.

BLITZER: All right, Suzanne. Thank you very much.

I want to go to Carol Costello. She's monitoring another story that's coming into THE SITUATION ROOM.

Carol, Dan Rather and CBS, there's a new chapter unfolding right now.

CAROL COSTELLO, CNN CORRESPONDENT: Dan Rather is suing CBS and other executives within the Viacom family, which owns CBS, for $75 million. As you know, he left CBS less than gracefully, and he's talking about things like fraud and CBS kicking him out of the job or forcing him to leave.

I'm just reading the complaint right now. I'm going to get more information for you, but I know he is going to be on "LARRY KING LIVE" I believe tomorrow night. So I'm going to read through this complaint, Wolf, and I'm going to get you more information.

BLITZER: A $75 million lawsuit filed by Dan Rather against CBS, top executives there, and its parent company as well.

Thanks very much, Carol. We'll check back with you.

Jack Cafferty is not here this hour. He's working on a special "Cafferty File". It's an hour-long special that's coming up in the 8:00 p.m. Eastern hour tonight. He'll be with us in the next hour.

Also coming up, his rivals for the Democratic presidential nomination may not want to talk about that controversial MoveOn.org ad. Bill Richardson is willing to talk about it. He has some strong words. Bill Richardson will be joining me here in THE SITUATION ROOM next.

Also, Rudy Giuliani has a message for MoveOn.org: Attack him. Find out why he wants -- yes, he wants -- the liberal group to bring it on. This is a CNN exclusive. That's coming up.

And more revelations about Hillary Clinton's ties to a man who was recently a fugitive. We're looking into possible gifts from Norman Hsu to Clinton staffers.

Lots going on right here in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: New Mexico Governor Bill Richardson is pushing hard to get his presidential campaign into the Democratic Party's top tier, then break through on the national scene. So he isn't pulling a lot of punches.

The governor was here in THE SITUATION ROOM just a short time ago.

(BEGIN VIDEOTAPE)

BLITZER: And joining us now, the governor of New Mexico, Bill Richardson, the Democratic presidential candidate.

Governor, thanks for coming in to THE SITUATION ROOM.

GOV. BILL RICHARDSON (D-NM), PRESIDENTIAL CANDIDATE: Thanks, Wolf. Nice to be with you.

BLITZER: What did you think of the MoveOn.org ad really going after General David Petraeus, calling him "General David Betray Us?"

RICHARDSON: Well I disagree with that. They shouldn't have done it.

On the other hand, MoveOn has done some great things to alert the American people about the escalation of the war. But they shouldn't have done that. My view, General Petraeus, Ambassador Crocker, they're distinguished public servants. I just disagree with their position, and they were following the president's lead.

BLITZER: Because some are asking candidates to really distance themselves from this organization now and to condemn them. Are you ready to go that far?

RICHARDSON: No. They made a mistake, but, no, they do a lot of good things.

They are progressive. They have alerted a lot of people about this war that is really damaging our country, Wolf. Our kids are dying, and this policy makes no sense. And this group has done a lot to educate the American people about the perils of this war.

BLITZER: All right. Let's talk a little bit about where you stand in this race for the White House.

In New Hampshire, this latest poll we have, you're fourth with 11 percent, well behind Clinton, Obama, and just behind Edwards. In Iowa, you're also fourth, behind Clinton, Edwards, Obama. You come in fourth, but nationally in our latest CNN-Opinion Research Corporation poll, while you're still fourth, you're only at 5 percent. Hillary Clinton's at 46 percent, Obama at 23 percent.

What do you do -- what do you need to do nationally to move you up in that race?

RICHARDSON: I have to do well in Iowa and New Hampshire, because what happens, Wolf, is there's a slingshot effect. It happens in every primary.

It happened to President Clinton. It happened to John Kerry, to President Bush. You do well in the first three or four states, especially Iowa and New Hampshire, and then you're thrust into the later primaries and you become known nationally.

I'm not known nationally. Those are name recognition polls. What I care about is how I'm doing in Iowa and New Hampshire.

And as you pointed out, I'm moving up. I'm either third or fourth. We're the only candidate that's moving up. Our ads are playing well. My theme of change and experience is working.

BLITZER: Iowa clearly is critical for you, and that's why I'm going to play a little clip of what you said back on September 3rd, because I want you to explain -- you have, but I need a little further explanation what you meant when you said this.

(BEGIN VIDEO CLIP)

RICHARDSON: Iowa, for good reason, for constitutional reasons, for reasons related to the lord, should be the first caucus and primary.

(END VIDEO CLIP)

BLITZER: All right. When I heard that, "for reasons related to the lord," what does the lord have to do with Iowa going before New Hampshire, Nevada or anybody else?

RICHARDSON: I mean, that was a stump speech. I was joking.

The point I was trying to make is that there's a reason Iowa and New Hampshire have been first, because they scrutinize candidates. They know these examples of democracy.

I was just -- at that time, other states were threatening to move ahead of Iowa and New Hampshire, and I was the first one to sign a pledge that said I will not campaign in any states that usurp the traditional role of Iowa and New Hampshire. But I was -- it was a joke. I was kidding.

BLITZER: So it has nothing to do with the lord?

RICHARDSON: No.

BLITZER: He's not involved in presidential politics. He's involved in a lot of other things, but not necessarily that.

Let's talk a little bit about you're going to be going before the NRA, the National Rifle Association. Are you the only Democratic presidential candidate who is basically on board with the NRA as far as gun rights for American citizens are concerned?

RICHARDSON: Well, I'm a western governor. I'm a hunter. I believe most Americans that are -- that own a weapon, own a gun, are law-abiding. And I believe the answer to reducing violence in this country is instant background checks, not just automatic gun control, taking guns away from people that are law-abiding. I think you've got to be sure as a country that we don't permit those that are mentally ill or have criminal backgrounds.

BLITZER: But assault weapons...

RICHARDSON: Well, yes. I think if we can get a ban on assault weapons that works -- the last ban didn't work. But instant background checks, including at gun shows, that's the position taken by Representative McCarthy, who is the biggest opponent of the National Rifle Association.

BLITZER: So you're not afraid this is going to alienate some of the Democratic base?

RICHARDSON: No. No. I think...

BLITZER: Your stance, together with the NRA, on guns?

RICHARDSON: No. Instant background checks, I think the National Rifle Association is working on a compromise. I happen to think it needs to happen because I think that's the best way to curb the violence that exists. I mean, like at Virginia Tech, it was terrible. What we need to do is have something that works.

But I'm a westerner. I'm a hunter. I think most -- most hunters are law-abiding, those that own a weapon. Let's not just have massive gun control. It's not going to work.

BLITZER: We've got to go, but what do you hunt?

RICHARDSON: Elk, bird. But I'm doing a lot of campaigning, so I'm not exactly doing a lot of recreation now.

BLITZER: You're hunting for something else right now.

RICHARDSON: I'm trying.

BLITZER: Governor, thanks for coming in.

RICHARDSON: Thanks very much. Thank you.

(END VIDEOTAPE)

BLITZER: They're two of the last people you expect to see at a public fight. Coming up in our "Strategy Session," what should we make of Vice President Dick Cheney's war of words with the former federal reserve chairman, Alan Greenspan?

Plus, the third party blues. Candy Crowley updates the possibilities for a three-way race for the White House.

Stick around. You're in THE SITUATION ROOM.

(COMMERCIAL BREAK)

(NEWSBREAK)

BLITZER: Still ahead, Rudy Giuliani steps onto the world stage today, getting some face time with the British prime minister. Also our own John King.

Stick around. You're going to want to hear what Giuliani says about how long the United States should stay in Iraq.

Also coming up, new questions about the relationship between Senator Hillary Clinton's staff and a now disgraced fund-raiser.

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

(COMMERCIAL BREAK)

BLITZER: Happening now, Iraq's prime minister calls on the U.S. to end its contracts with a private security company in Iraq after a controversial shootout. But if Blackwater USA goes, will U.S. forces have to pick up the slack?

We're going to put that question to the number two U.S. military commander in Iraq, Lieutenant General Ray Odierno.

A racially divisive court case in Jena, Louisiana, is also creating some tension between two political allies. You're going to find out what Barack Obama said that did not sit well with the Reverend Jesse Jackson.

And an unexpected request by Iran's president, Mahmoud Ahmadinejad. He wants to visit Ground Zero in New York. Will the U.S. let him?

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

Rudy Giuliani wants you to know he feels comfortable on the world stage. So, images like these are invaluable, as the Republican presidential candidate met with Britain's new prime minister in London to talk about some major global issues.

And, yet, he's also got some choice words about the Bush administration, liberal critics, and other subjects.

Let's go to our chief national correspondent, John King. He's traveling with Giuliani in London.

You got an exclusive interview, John, with the Republican presidential front-runner. Tell our viewers what he had to say.

JOHN KING, CNN CHIEF NATIONAL CORRESPONDENT: Wolf, some very muscular language from the former New York City mayor about Iran, saying it would never get a nuclear program in a Giuliani administration.

He also said the American people need to be prepared for an indefinite military presence in Iraq and the Middle East. And we also discussed some of the campaign controversies back home.

(BEGIN VIDEOTAPE)

KING: You're in this spat right now with MoveOn.org...

(LAUGHTER)

KING: ... and, by extension, Hillary Clinton over the ad criticizing General Petraeus.

RUDOLPH GIULIANI (R), PRESIDENTIAL CANDIDATE: Right.

KING: MoveOn.org comes back at you with a criticism that, well, here was a guy who had this unique opportunity to sit on the Iraq Study Group, to get inside information from the generals, from the administration on everything that went right in Iraq, everything that went wrong in Iraq. He wanted to be next president of the United States. And, instead, he skips the first two meetings and then leaves the group because he was giving paid speeches, and he didn't want to attend the meetings.

GIULIANI: Well, the reason I did it was, I couldn't give the time to it. And, secondly, I knew that, ultimately, I could very well be running for president of the United States. I wasn't sure at the time. And had I stayed on that group, their report was put out just around the time I announced for president. And I would have totally politicized it. It was a mistake to join in the first place.

And, as far as foreign policy experience goes, I have probably traveled to Europe, Asia and Africa more often in the last five, five- and-a-half years than any of the people that are running for president. I have had more executive experience than any of them. I have had the responsibility for safety and security on my shoulders for much of the last 20 or 25 years.

I have actually dealt with terrorism. I have actually dealt with it firsthand. And, frankly, I wish MoveOn.org would do several more commercials attacking me...

(LAUGHTER)

GIULIANI: ... because, if they do, it could get me nominated. They are not exactly the most popular group among Republicans.

They have spent $200 million to $300 million assassinating the character of Republican candidates. And the fact that they want to personally attack me is probably a badge of honor for me and probably is going to jump me five points in the Republican primary.

(CROSSTALK)

KING: Without a doubt, a fair statement.

Let me bring a couple of things that have had people, some political critics, to be fair, but raise questions about your judgment to lead the war on terrorism. And they're familiar to you, that Rudy Giuliani, as mayor, put his emergency response center in a building that had been targeted by terrorists before.

GIULIANI: Well, I put my emergency center in a building that was also home of the CIA, the Secret Service, all the major federal agencies we've got to be in contact with in an emergency.

KING: Is that almost -- is that almost like a -- is there a risk of going too far into the bravado part of it, you know, damn you, we're not going to be scared by you, but at the same time...

GIULIANI: No, absolutely not. No. No. The idea was, we had to be in communication with those agencies. And those -- and that building got a great deal of security as a result of -- I mean, the CIA was there. The Secret Service was there. All the agencies were there.

You know how many buildings in New York are targeted by terrorists? I used to know the list cold.

KING: As you know, you've angered some members of the first- responder community recently with this statement: "I was at Ground Zero as often, if not more, than most of the workers, exposed to the same things they were. So, in a sense, I am one of them."

"The New York Times" looked at this in the three months of September 16 to December 16, 2001, and said the mayor was there about 29 hours over total in those three months. The workers, over a course of three days, would be there more than 29 hours.

GIULIANI: I -- I was there probably in the first two weeks more than 29 hours.

So, "The New York Times," in some cases, is not the most accurate judge of my record or of my time.

KING: An exaggeration on your part, though?

GIULIANI: it was a comparison with some of the people who have gotten sick, who were there less often that I was, some of the people who worked on my staff, some of the people who were there maybe a third of the time than I was.

What I was actually pointing out was, you can be there for a relatively short period of time and still get sick and still be considered in the category of people that are at risk. But the reality is that I was there a good deal of time, a lot more than "The Times" indicates, there in two weeks more than "The Times" indicates. I wasn't there as much as some others, but I was there enough so that I would be in the at-risk category by -- in fact, I have even been invited to join some of the studies, some of the tests to determine what kind of impact did it have on me.

KING: On Friday, you will give a speech back in the States to the National Rifle Association. Back in the Clinton administration, you sat in the front row when the president signed into law the assault weapons ban. That law has since expired.

Back at that time in '95, you said the NRA was going -- quote -- "way overboard" in its opposition to the assault weapon ban, and you said the problem was that -- quote -- "Extremists on the other side" are unwilling to essentially understand the problems of an inner-city mayor when it comes to gun control.

Are you willing to now go before that group and say, there are cases where you must not go -- quote -- "way overboard?"

GIULIANI: Well, sure, but we're -- we're at a different time now. And we're in a different situation.

I mean, the reality is that I always believed that it made the most sense for state and local governments to deal with this, that we should do everything we can to reduce crime. The programs that I had just begun back then have now turned out to be even more successful than I thought they would be, which largely focused on people who were using guns, and to treat them in a way in which we had zero tolerance for them.

KING: We're out of time, so I will jump in quickly. But wouldn't a mayor of Baltimore or New York City today say that, if you just do this state by state, then they can bring the assault weapon from Virginia or they can bring the assault weapon in from New Jersey?

GIULIANI: Well, you know, I think, actually, if you do it state by state, you can get tremendous impact. I did it state by state, and look at the impact that I had.

I dealt with enforcing the laws that existed in New York. And what was the impact? Seventy-four percent decline in shootings. And I believe that decline in shootings has continued to go -- to go on since I left office, with the Comstat program, with a tough-on- criminal approach, tough on criminals who use guns.

So, the reality is, the proof is in the pudding. I mean, we actually made the local laws work in a way that created the safest large city in America.

(END VIDEOTAPE)

KING: Former Prime Minister and conservative hero Margaret Thatcher at Mayor Giuliani's side tonight, Wolf, as he gave a speech here in London. And this trip is not just about looking presidential. It's about paying for the presidential campaign -- Mayor Giuliani raising money from Americans who live here in London at a luncheon this afternoon.

He says, with the race so tight for the Republican nomination and probably so tight in the general election, you have to raise every dollar you can and look for every vote, even overseas -- Wolf.

BLITZER: There are some rich Americans in London, I am sure, as well.

(LAUGHTER)

BLITZER: What about the statement he made to you, John, that, if he's president of the United States, Iran will not be a nuclear weapons power; one way or another, he will make sure of that. How specific did he get?

KING: He was very muscular, Wolf. He said the military option would not come off the table. He would hope to work with U.S. allies, but, if necessary, he would work on his own.

He said, flatly, Iran will not have a nuclear program if Rudy Giuliani is president of the United States -- very muscular language, and the same tone that some European allies find too macho from President George W. Bush, but Rudy Giuliani said, compare me to Ronald Reagan then. They will not get a nuclear program.

BLITZER: All right.

John King doing some good reporting, as he always does for us -- thanks, John.

John is in London with Rudy Giuliani.

Perks or appreciate -- inappropriate presents? The watchdog groups are raising flags about an embattled fund-raiser's gifts to the Clinton campaign staff.

And Dick Cheney firing back after the former Federal Reserve Chairman Alan Greenspan blasts some Bush administration policies.

All that, lots more, coming up -- right here in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: Disgraced Democratic Party fund-raiser Norman Hsu heads back to court, as he faces legal troubles. There are new details emerging about the access he earned through the cash he raised. And it's also bringing in focus the use of so-called bundlers.

Let's go to CNN's Mary Snow. She's watching this story for us in New York.

Also some questions being raised about gifts he gave to some staffers. What what's going on, Mary?

MARY SNOW, CNN CORRESPONDENT: Well, Wolf, those questions are being raised on those gifts dating back to Senator Clinton's Senate campaign. Now, in the case of Norman Hsu, he raised plenty of cash, but he also cost the Clinton campaign public embarrassment.

(BEGIN VIDEOTAPE)

UNIDENTIFIED MALE: Did you sign these documents?

NORMAN HSU, DEFENDANT: Yes, Your Honor.

SNOW: Fund-raiser-turned-fugitive Norman Hsu appeared before a judge in Colorado today, paving the way to return to his home state of California.

The Clinton campaign has distanced itself from Hsu, returning $850,000 in campaign donations he helped raise. But it's new details about his Hsu's coziness with the Clinton campaign before his legal troubles came to light that some watchdog groups say need examining.

SEN. HILLARY RODHAM CLINTON (D-NY), PRESIDENTIAL CANDIDATE: The best campaign staff in the entire country!

(CHEERING AND APPLAUSE)

SNOW: November 2006: Senator Hillary Clinton wins reelection. Hsu helps some Clinton campaign staffers celebrate. "The Los Angeles Times" first reported, and the Clinton campaign confirms, that Hsu treated Clinton staffers to several days at a Las Vegas hotel and casino, among them Patti Solis Doyle, one of Senator Clinton's closest adviser.

Hsu tried to give her an expensive handbag, but she declined the gift. A Clinton spokesman says the staffers they for their own travel and believed the hotel rooms were comped by the hotel. Turns out Hsu did pay for the rooms, as well as dinners and a Vegas show. All of it was legal.

JOAN CLAYBROOK, PRESIDENT, PUBLIC CITIZEN: Obviously, this case with Hillary Clinton's campaign staff has raised an issue that needs to be addressed.

SNOW: That issue, says Joan Claybrook of Public Citizen, is the need for full vetting and disclosure of fund-raisers like Hsu.

The watchdog group has launched White House For Sale, listing all campaign bundlers.

QUESTION: Mr. Hsu, did you give money to the...

SNOW: Bundlers are fund-raisers who collect money from donors and present it to a campaign all at one time, in a bundle. Because there are limits on individual donors, campaigns are increasingly relying on bundlers to tap family and friends. Using bundlers, though, can carry risks.

JEANNE CUMMINGS, LOBBYING AND MONEY CORRESPONDENT, POLITICO.COM: They become surrogate faces of the campaign. And, so, when one of them has trouble, it reflects back on the campaign machinery and the candidate.

SNOW: Bundling isn't the problem. It's when bundlers aren't carefully vetted that proves potentially embarrassing for the campaign.

Jailed lobbyist Jack Abramoff was once a bundler for the Bush campaign. His legal troubles were linked to his work as a lobbyist. Still, it proved embarrassing for the president because his fund- raising put him in such close proximity.

(END VIDEOTAPE)

SNOW: And, as the use of bundlers rises, Public Citizen says it wants to see more rules and regulations on them. That could include full disclosure and limits on things like gifts -- Wolf.

BLITZER: All right, Mary -- Mary Snow reporting for us in New York.

Want to go back out to Las Vegas.

Ted Rowlands is working the O.J. Simpson story. And there's a new development just coming into THE SITUATION ROOM.

Ted, what is going on?

TED ROWLANDS, CNN CORRESPONDENT: Wolf, another arrest.

According to a source with the -- close to the investigation, Charles Cashmore (ph), a 40-year-old white male -- this is one of the outstanding individuals that was featured in that surveillance video that Las Vegas Police provided of the -- from the Palace Station Casino. This is one of the men that was previously unidentified. They have identified him and arrested him. He turned himself in, according to the source, at 11:00 locally here at his attorney's office. He's being booked on the same charges that O.J. Simpson and the others are charged with, leaving one outstanding suspect, so, another arrest, Charles Cashmore (ph) in custody this afternoon.

BLITZER: Just to be precise, Ted, this brings to, what, five, if you include O.J. Simpson, five individuals who have now been arrested?

ROWLANDS: Correct, and one outstanding. And this is another -- the only one outstanding is the other unidentified white male that was featured in that surveillance video still that was released by the Las Vegas Police.

But they have made another arrest, and this is in addition to the Alfred Beardsley arrest, one of the alleged victims. He was picked up by U.S. Marshals on a probation violation out of California. He is also being held in the jail. So, another -- two more being booked into the Clark County Detention Center here in Vegas.

BLITZER: All right, Ted, thanks very much.

We are going to have a complete recap of what's going on out in Vegas involving O.J. Simpson at the top of the hour.

Stay tuned for that.

Also coming up, Rudy Giuliani says, patience is the path to victory in Iraq.

(BEGIN VIDEO CLIP)

GIULIANI: If the Islamic terrorists see a determined, patient America, there's a really good chance we're going to defeat Islamic terrorism sooner, rather than later.

(END VIDEO CLIP)

BLITZER: So, how long -- how will that message play, though, with voters here in the United States? That coming up.

Also, stand by your man -- the vice president, Dick Cheney, delivering a barbed response to Alan Greenspan's charge that President Bush is no fiscal conservative.

We will talk about that, a lot more. James Carville and Terry Jeffrey, they're standing by for our "Strategy Session."

That's coming up next.

You're in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: As New York's mayor, Rudy Giuliani, was never one to mince words, today, he's talking very bluntly about everything from the war in Iraq, to the situation in the Middle East, to MoveOn.org.

Let's go to our "Strategy Session." Today, Democratic strategist James Carville is here, as is Terry Jeffrey, the editor in chief of CNSNews.com, the Cybercast News Service, a new gig for you.

We will talk about that later.

TERRY JEFFREY, EDITOR, "HUMAN EVENTS": OK.

BLITZER: Let's talk about Rudy Giuliani first.

He's mincing no words, as -- if he became president, what he would do as far as keeping troops in Iraq are concerned.

Listen to this.

(BEGIN VIDEO CLIP)

GIULIANI: Whether it's Iraq itself or it's Kuwait or other parts of the Middle East, we're going to probably have to make a military commitment there for the indefinite future. And, maybe, if we do that we're going to get over this faster.

(END VIDEO CLIP)

BLITZER: His point, James, being, if they realize, the bad guys out there, that the United States is not picking up and leaving, they're going to give up.

JAMES CARVILLE, CNN POLITICAL ANALYST: I guess, for me, it's politely, how do I not bust out laughing?

Here is a man that was appointed to the Iraq Study Group that never went to a single meeting. Here is a man that didn't -- decided he had other things to do besides join the military. Now he wants, you know, 150,000 troops stationed permanently in the Middle East.

I mean, it's kind of -- there's a real element of hypocrisy here, I guess is the simple way to put it. If he's so interested in this, why didn't he dedicate his time, as a lot of other good Americans did, on this Iraq Study Group?

(CROSSTALK)

CARVILLE: So, I don't -- I can't take it seriously.

BLITZER: Is that what voters, Terry, want to hear, indefinite future, keeping troops there?

JEFFREY: I think this is a liability for Rudy Giuliani.

To tell you the truth, Wolf, I think the worst thing that Rudy said in this campaign was in your CNN debate up in New Hampshire when he was asked, knowing what we know now, do you think it still was a good idea to invade Iraq? And he said absolutely. Romney made a much more careful and prudent answer. He said, well, the situation we're in now is what we have to deal with. I think, in a general election, remarks like that will hurt Rudy and make him a more difficult Republican candidate to win next November.

BLITZER: On the political front, what Rudy Giuliani just told our John King is that the MoveOn.org feud, that is going to help him.

(CROSSTALK)

CARVILLE: It probably is, yes.

BLITZER: Basically, he's saying, bring it on. He likes that.

CARVILLE: Yes. I don't think there's any doubt that he's -- MoveOn.org is probably getting in the middle of this, and they're probably raising more money. And it's -- boy, it's what they -- Mark Halperin and John Harris call the freak show.

And everybody is all, you know, all gassed up about this. But the two benefits here are Rudy Giuliani and MoveOn.org. And he admitted it. He said, well, this is very political. Maybe this thing will get me up five points.

He doesn't care about any of this. He's talking to John King about I think I can get five percentage points out of this.

JEFFREY: It's almost like an implicit conspiracy between MoveOn.org and Rudy Giuliani.

MoveOn.org gets to energize its own people.

CARVILLE: Yes.

JEFFREY: And Rudy Giuliani gets an opportunity to energize the conservative base of the Republican Party, which, in a lot of other circumstances, wouldn't be too happy...

(CROSSTALK)

CARVILLE: And we get something to talk about.

(CROSSTALK)

JEFFREY: We get something to talk about.

CARVILLE: Everybody gets a win.

(LAUGHTER)

(CROSSTALK)

BLITZER: He sort of summed it up pretty succinctly. Listen to what Giuliani told John.

(BEGIN VIDEO CLIP) GIULIANI: I wish MoveOn.org would do several more commercials attacking me...

(LAUGHTER)

GIULIANI: ... because, if they do, it could get me nominated.

(END VIDEO CLIP)

CARVILLE: Yes.

BLITZER: And we're going to invite somebody from MoveOn.org to come into THE SITUATION ROOM and get their response to all of this as well.

(CROSSTALK)

CARVILLE: Unfortunately, this has nothing to do with any reality, but it's always fun for everybody. Everybody had a good time.

BLITZER: Well...

CARVILLE: It's a hell of a party.

BLITZER: Here is another little feud that has erupted, very polite, very sophisticated, we should say, a feud involving the vice president of the United States and the former Federal Reserve chairman.

Dick Cheney writing in "The Wall Street Journal" today, among other things, saying, "In his new book, 'the Age of Turbulence,' my longtime friend Alan Greenspan argues that President Bush's economic and budget policies have been fiscally irresponsible. I think his assessment is off the mark."

These guys are basically pretty good friends, too.

CARVILLE: Right.

But -- but Alan Greenspan and Dick Cheney have an entirely different view. Dick Cheney famously said that budget deficits don't matter. Alan Greenspan, for whatever one may think or not think of him, has been pretty consistently thinking that budget deficits are harmful and that he's very concerned about the deficit -- not just the deficit, but the structural deficit that hasn't been addressed.

So, you have two people who have a different economic philosophy. One says, budget deficits don't matter. One says they do. So, it's not...

(CROSSTALK)

JEFFREY: Well, Alan Greenspan has half-a-point on the fiscal discipline side, but Dick Cheney made some excellent points in his op- ed today. First was that Greenspan told him and President Bush in December of 2000 that the economy was heading into a recession when President Clinton was still in office. That's true.

Second, he made the point, which is true, that we have had six years of economic growth since we have had the Bush cuts. And the third thing, which goes to the question of deficits, is that we have actually had three years of large growth in federal revenue because of the Bush tax cuts, the three largest years in a row of federal revenue growth since the Reagan tax cuts of the 1980s.

If they simply would control spending, Wolf, we could get the deficit down.

CARVILLE: Let me point the fact that this administration blew $5.5 trillion. That was the surplus. Instead of coming up and have a $300 billion deficit, and they say, well, it's not that big. Yeah, if you don't count the $5.5 trillion that you wasted.

And, by the way, we hadn't got a Popsicle on income growth.

(CROSSTALK)

CARVILLE: ... Popsicle in stock market growth.

BLITZER: Terry, I'm sure you will agree with Alan Greenspan that the president should have vetoed several of those spending bills.

JEFFREY: Look, there's no doubt about it. And he also did the Medicare prescription drug plan, one of the most expensive bills this country has seen in four decades.

So, here's an irony, though, you know, something that disappointed conservatives like me. We had President Clinton. He had to deal with a Republican Congress. A Republican Congress forced fiscal discipline on a Democratic president. When he had a Republican president and a Republican Congress that did not engage in fiscal discipline...

BLITZER: All right.

JEFFREY: ... that was a problem.

BLITZER: We have got to leave it there, guys.

CARVILLE: That's it?

BLITZER: But we will do this again.

CARVILLE: We agreed too much today. It was unbelievable.

(LAUGHTER)

BLITZER: James Carville, Terry Jeffrey, in the "Strategy Session," guys, thanks very much. In Iraq, if hired bodyguards who protect U.S. diplomats are kicked out of Iraq, will U.S. troops be able to step in? I will ask the number-two U.S. military commander in Baghdad, Lieutenant General Ray Odierno. He will be joining us.

And they were having fun as people nearby were slaughtered. You are going to see some newly revealed photos showing Nazi officers lounging and frolicking as Jews are marched off to their deaths during World War II.

Stay with us -- much more coming up.

(COMMERCIAL BREAK)

BLITZER: In today's "Political Radar," CNN has now confirmed that the Bush administration's agriculture secretary, Mike Johanns, will be stepping down to make a run for the U.S. Senate in Nebraska -- two Republican sources telling our senior national correspondent, John King, the former Nebraska governor has informed the White House he plans to resign as early as today and definitely this week.

Earlier this month, Senator Chuck Hagel of Nebraska announced he was retiring at the end of his term, would not seek reelection next year. Hagel and Johanns are both Republicans. On the Democratic side, the former Nebraska Senator Bob Kerrey is considering jumping into the race.

Senator Barack Obama has announced plans for a massive rally in the heart of New York City. The Democratic presidential is enlisting his supporters to help spread the word.

Our Internet reporter, Abbi Tatton, has more on this story.

What is he doing, Abbi?

ABBI TATTON, CNN INTERNET REPORTER: Wolf, Senator Barack Obama's online supporters are already pretty mobilized in raising money. Well, now the campaign is asking them to get on the phone -- just launched, an online phone bank that supporters can access from their computers anywhere in the country and use it to invite New Yorkers to a September 27 rally in New York City, Senator Hillary Clinton's backyard.

The phone numbers that the database generates are not necessarily those of Obama supporters. The campaign says they're registered Democrats in the area with strong voting records.

We saw online phone banks used before. In the 2006 midterm elections, MoveOn.org, the liberal group, used their online phone bank to generate more than five million calls around the country. And the Republican National Committee got together with leading conservative bloggers to get phone calls out there in get-out-the-vote efforts.

A spokeswoman for the Barack Obama campaign says this is an effort, with their phone bank, to reach out to people in the New York City area that may not hear about the rally. If you're one of those voters, don't worry. The phone calls stop at 9:00 p.m. -- Wolf.

BLITZER: Thanks very much, Abbi, for that.

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