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THE SITUATION ROOM

Blackwater Immunity; Bombing Virginia

Aired October 30, 2007 - 17:00   ET

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


TATTON: He's offering you can register one phone number here for free. Republican strategist Terry Holt, who has managed political campaigns, argues not all these calls are bad. Robocalls may be ineffective, but other calls can be important -- getting people rides to the polls, for example.
But Dakin says that for a small fee you can register here and specify exactly which calls you want to avoid. Don't expect any results any time soon, though. The candidates themselves have to buy the list and pledge not to call you -- Wolf.

BLITZER: Abbi, thank you.

And to our viewers, you're in THE SITUATION ROOM.

Happening now, a U.S. Navy jet drops a bomb on Virginia. It was just a practice dud, but tell that to the folks in the neighborhood where it landed.

Who's an idiot -- insults flying between CNN's Lou Dobbs and the New York governor, Elliot Spitzer. It all started with a fight over immigration. Lou is standing by to join us with his side of the story.

And should your state take on billions in new debt to fund the fight against cancer?

Texans will answer that question on election day. I'll ask the cycling legend and cancer survivor, Lance Armstrong, about that, as well.

I'm Wolf Blitzer.

You're in THE SITUATION ROOM.

A Navy fighter jet today bombed the coastal resort of Virginia Beach. It was a practice bomb -- no explosives. But the Navy is scrambling right now to try to find out how this could happen.

Let's go to our senior Pentagon correspondent, Jamie McIntyre.

He's watching this story for us -- Jamie, what do we know?

JAMIE MCINTYRE, CNN SENIOR PENTAGON CORRESPONDENT: Well, Wolf, it started as a routine training mission, but it didn't exactly end that way. A U.S. Navy F-18 was landing back at its base at Virginia Beach, Virginia, at the Oceana Naval Air Station, when a practice bomb -- a small bomb, about 10-pounds in weight, fell off the plane and hit a warehouse in the Virginia Beach area. This is an inert practice bomb that is designed to emit smoke so that pilots can see where they dropped it. It apparently scraped the side of this warehouse, the Brooks Transfer & Storage Company there in Virginia Beach. It didn't really cause much damage, but nevertheless, any time something falls out of the sky from a fighter plane, it's considered a serious incident.

The Navy is investigating. Nobody was hurt. The damage was described as extremely insignificant, as it just scraped the side of this building. But, again, an investigation is underway -- Wolf.

BLITZER: Because it could have been a whole lot worse, obviously, if it would have been a real bomb.

MCINTYRE: Yes, but they don't use those real bombs in this kind of a training scenario. The training range is nearby in North Carolina. So there really wasn't much risk, except if you actually got hit by this small 10-pound object. But nevertheless, it's not something you want to have happening.

BLITZER: All right.

Jamie McIntyre at the Pentagon.

Thank you.

They were involved in a bloody shoot-out that left Iraqi civilians lying dead -- private U.S. security guards for an official U.S. convoy. The shockwaves from last month's incident are still spreading. And now there are suggestions that those guards could actually be protected from any prosecution.

Let's bring in our State Department correspondent, Zain Verjee.

She's watching this story for us -- Zain, what's is the latest?

ZAIN VERJEE, CNN STATE DEPARTMENT CORRESPONDENT: Wolf, the gunshots from September the 16th are echoing from Baghdad to the United States. And there's debate over whether the case will ever end up in court.

(BEGIN VIDEO TAPE)

VERJEE (voice-over): Blackwater guards may not be prosecuted for a shooting that killed 17 Iraqis. Several senior U.S. officials tell CNN that State Department internal security officers gave limited immunity to Blackwater guards for statements they made soon after the incident.

JEFFREY TOOBIN, CNN SENIOR LEGAL ANALYST: Limited immunity means that a federal criminal prosecution could not use any of the statements that have been made to investigators, which would make a difficult case practically impossible.

VERJEE: That could be a big snag for the FBI's criminal investigation. Democratic Senator Patrick Leahy, chairman of the Senate Judiciary Committee, slammed the decision, saying it's part of a pattern by the Bush administration: "If you get caught, they will get you immunity. If you get convicted, they will commute your sentence. They are the amnesty administration."

The State Department insists it's not giving Blackwater a free pass and the investigation continues.

SEAN MCCORMACK, STATE DEPARTMENT SPOKESMAN: The State Department cannot grant immunity to individuals from federal criminal prosecution.

VERJEE: Blackwater says its guards did nothing criminal, they fired in self-defense. Iraqi officials say it was murder. But immunity or not, it may be impossible to get a prosecution, because Blackwater is in a legal twilight zone.

TOOBIN: There is a possibility that American citizens killed 17 people in cold blood and there is no possibility of any accountability -- not in Iraq, not in the United States. And all the various legal systems are struggling for a way to figure out how -- if a crime took place -- people could be held to account.

(END VIDEO TAPE)

VERJEE: Secretary Rice and Defense Secretary Gates met at the Pentagon today and they agreed that there has to be more oversight of Blackwater and other private contractors and the new rules on the use of force, as well as coordinating contractor movements.

BLITZER: I know you've been speaking to a lot of experts on this and the Iraqis and the U.S., they're considering taking some new legal steps to deal with these private security contractors.

Here's the question -- would that make any difference in this particular case?

VERJEE: Well, the legal experts that I've spoken to say that, no, it's not going to make a real difference in this instance, no matter what steps they're taking to make security contractors more accountable. And the reason is they can't apply any new laws retroactively to an instance that has happened in the past.

BLITZER: Zain, thanks very much.

You'll continue to watch this story for us.

Meanwhile, a desperate battle at sea, as the crew of a hijacked cargo ship struggling to take back its vessel from pirates. A U.S. warship comes to their aid this time, but other merchant vessels aren't so lucky.

Let's go live to our Pentagon correspondent, Barbara Starr.

She's watching this story -- Barbara, what -- what happened? BARBARA STARR, PENTAGON CORRESPONDENT: Well, Wolf, this is an amazing tale.

First, let's take a look at a map in the area of the world we're talking about. This is the Horn of Africa, off the coast of Somalia. This is an area in East Africa that has just been rife with piracy over the last several years.

Yesterday, a North Korean cargo ship carrying sugar was transiting through this area when it was hijacked by pirates. The pirates came on board and basically took control of the ship. The North Korean crew -- the crew from the ship -- sent out a distress call. And who responded to them but the U.S. Navy.

The USS David Williams, a destroyer, was nearby, sent a helo over the ship, tried to get the pirates to give up their weapons. They didn't. A fight broke out between the crew from the North Korean ship and the pirates. When it was all over, Wolf, three injured crewmen were taken on board the U.S. Navy warship. They are getting medical assistance at this hour.

So how serious is this issue of piracy on the high seas?

We spoke a little while ago to a Navy commander who specializes in this.

(BEGIN VIDEO CLIP)

COMMANDER BRYAN MCGRATH, U.S. NAVY: There are several operations underway as we speak. It's important to realize that this is -- this is a real world problem. And the ships that are responding now are part of a real world solution to that problem.

(END VIDEO CLIP)

STARR: Not to be flip, Wolf, it is not "The Pirates of the Caribbean" movie. In fact, another second operation is still underway, as we speak, in the same area, involving the U.S. Navy for the second day. They are tracking another ship that has been pirated, that has been hijacked. It has carried a very dangerous cargo of benzene. The U.S. Navy is shadowing that ship, hoping they can do something about that, as well. But they helped out a North Korean ship -- Wolf.

BLITZER: Thank you, Barbara.

Barbara Starr at the Pentagon with that.

Let's go to Jack Cafferty.

He's got The Cafferty File in New York -- who knew, Jack, that pirates all of a sudden a security concern out there.

CAFFERTY: Yes. I'm just sitting here thinking, I mean we don't have enough problems, now we have pirates out there that the Navy has to be concerned about and we've got this -- violent crime on the rise in this country for the second year in a row. Back in the 1990s, coincidentally or not, crime fell to its lowest level in decades when President Clinton decided to put an additional 100,000 police officers on the streets. Well, it's something that's being talked about again. Democratic Senator and presidential hopeful Joe Biden has introduced what he calls the most comprehensive anti-crime package since the 1994 Crime Bill. It would reauthorize a program called Community Orienting Policing Services or COPS.

Aren't they clever?

His legislation would provide funding for local law enforcement agencies to hire 50,000 new police officers over six years and would also add a thousand FBI agents to focus on local crime fighting.

Biden says after 9/11, the Bush administration shifted federal resources away from violent crime and toward counter-terrorism. And he says -- quoting now -- "We've improved our ability to fight international terrorism, but we left our communities here at home less safe from the threats of murderers, rapists and drug kingpins."

Critics say COPS amounts to the federal government stepping in on local responsibilities. There's also a study out this year that suggests that COPS spending had little or no effect on violent crime.

But L.A. Police Chief Bill Bratton -- he used to be the commissioner in New York City -- doesn't buy that. He tells the "L.A. Times": "I'm in the streets. I know what works. Cops count.

So the question this hour is this -- is putting more police on the streets of U.S. cities the answer to rising violent crime?

Your thoughts, caffertyfile@CNN.com or go to CNN.com/caffertyfile.

I wonder if any of those pirates have those little parrots on their shoulders.

BLITZER: (LAUGHTER). Or the patches on their eye, yes.

CAFFERTY: And the patch.

BLITZER: That's -- that would be cool.

All right, Jack.

Thanks very much.

A war of words a war of words involving CNN's own Lou Dobbs versus the governor of New York, Elliot Spitzer.

(BEGIN VIDEO CLIP)

GOV. ELIOT SPITZER (D), NEW YORK: It's beneath me. It's beneath my office to in any way to involve myself with Lou Dobbs. And I think his knowing spread of venom is beneath CNN, as well. (END VIDEO CLIP)

BLITZER: So what's this battle all about?

Lou is standing by to join us with his side of the story.

We heard from Eliot Spitzer on CNN earlier today.

Also, could another first lady be thinking about a run for office?

We're talking about the current first lady -- Laura Bush. We'll explain what's going on.

And allegations of abuse at Oprah Winfrey's school for girls -- why that hits so close to home for the talk show host.

Stick around.

You're in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: There's growing buzz about a first lady with political ambitions. And we're not talking about Hillary Clinton. We're talking about Laura Bush.

Carol Costello is here in THE SITUATION ROOM.

So what's all this buzz about?

What's fueling this talk that there may be a political future for Laura Bush?

CAROL COSTELLO, CNN CORRESPONDENT: Well, wait.

I must address our audience, because insiders I know you are snickering right now. But remember, the thought that a first lady would ever run for office was not even in your head until Hillary Clinton did it.

So what about Laura Bush?

Why not?

(BEGIN VIDEO TAPE)

COSTELLO (voice-over): Could she?

Will she?

Could another first lady, Laura Bush, have her sights set on elected office?

Scoff if you must, but she's been very political this year.

LAURA BUSH, FIRST LADY OF THE UNITED STATES: We're able to bring up before the Security Council a resolution on Burma.

COSTELLO: And there's more. She's met with the president of Mozambique. She also traveled to the Middle East on an image building tour, visiting Saudi Arabia, Kuwait, Jordan and the United Arab Emirates. At Camp David with Afghan President Hamid Karzai.

And when asked why the sudden political passion?

BUSH: Well, the fact is I've been involved for a long time in policy and I think I just didn't get a lot of coverage on it. I mean I really do think there is a stereotype and I was stereotyped as being a certain way because I was a librarian and a teacher and, you know, I had these careers that traditional women had, that were considered traditional women's careers.

COSTELLO: Not anymore. Laura Bush is tough. Writing an editorial in "The Wall Street Journal" about the military crackdown in Burma, using phrases like "the United States expects" and "the economic pressure will only grow more intense."

Her tough talking husband was impressed.

QUESTION: What did you think of your wife's editorial today?

COSTELLO: And consider this -- Texas Senator Kay Bailey Hutchison is likely leaving the Senate by 2012 -- an opening some Texas Republicans would love to fill with Laura Bush.

BILL CROCKER, REPUBLICAN NATIONAL COMMITTEE: She has popularity with every segment of the Texas party. And if she wants to be a candidate or can be talked into being a candidate, I think she would be a very significant, very substantial candidate.

COSTELLO: While the thought of Senator Laura Bush tantalizes, most political insiders say it's unlikely. They call Bush's new political passion her way of supporting her beleaguered husband.

SALLY QUINN, AUTHOR AND JOURNALIST: I think that Laura Bush cannot wait to get out of the White House, cannot wait to get out of Washington, cannot wait to get out of politics. I think that what she really wants to do is go back to Texas, go to her ranch and read her novels and smoke her cigarettes.

(END VIDEO TAPE)

COSTELLO: And there you go.

And you know Sally Quinn could be right. Mrs. Bush's press secretary says -- said this of a possible Texas Senate run. She said -- and I quote -- "No, I don't think we will see Mrs. Bush's name on a Texas ballot any time soon. I think you can expect to see Mrs. Bush continue to support the issues that she champions as first lady, including global education and literacy, women's health, expansion of democracy and protection of human rights around the world.

BLITZER: You know, I remember when Hillary Clinton was thinking about running for the Senate from New York. She went on a listening tour in New York State, all over the state. She eventually decided to run.

Maybe Laura Bush will go on a listening tour of Texas and make up her mind, as well.

COSTELLO: We'll be watching.

BLITZER: Carol, thanks very much.

By the way, Mrs. Bush has now traveled to 68 countries, both with the president and on her own diplomatic missions. Compare that to Hillary Clinton, who made more than 80 trips abroad -- the most of any first lady. But Laura Bush still has a year plus to go.

Before that, by the way, Pat Nixon held the record, with trips that included her husband's famous visit to China and a visit to Vietnam at the height of the war.

This time he didn't shoot any of his hunting buddies, but Vice President Dick Cheney's latest hunting trip has still sparked an uproar.

Let's go to our Mary Snow.

She's in New York watching this story.

What's the fuss about this time Mary?

MARY SNOW, CNN CORRESPONDENT: Well, Wolf, we're here in Union Vale, New York -- Upstate New York. Vice President Dick Cheney came here yesterday to go hunting. It's not what he did while he was here that is causing controversy, but a symbol found on the hunting grounds that's causing the stir.

(BEGIN VIDEO TAPE)

SNOW (voice-over): It is this image of a confederate flag captured by a "New York Daily News" crew that has stirred controversy. The photo was taken shortly after Vice President Dick Cheney hunted here in Upstate New York Monday.

JOE GOULD, "NEW YORK DAILY NEWS": It was inside the garage. The door was opened in the garage. So it would have been visible from the -- from the road.

SNOW: The "Daily News" crew acknowledged they don't know if the door was open and the flag visible when the vice president passed by. A spokeswoman for the vice president said, "The vice president didn't see a flag and neither did any of the staff traveling with him." She declined to give specifics on the vice president's view of the confederate flag. But a local leader of the NAACP says he found it disturbing.

KEVIN CROMER, PRESIDENT, NAACP/DUTCHESS COUNTY, NEW YORK: It's extremely unfortunate that an elected official who represents all of us chose to hunt within a facility believes in, obviously, segregation.

SNOW: The Clove Valley Rod & Gun Club, a private club, declined any comment at all. One pastor of a nearby church said it's not uncommon to see Confederate flag decals in the area, but insists it's seen as a symbol of rebellion, not racism.

REV. JIM WICKSTEAD, VALLEY BIBLE FELLOWSHIP CHURCH: In my experience, the people that have displayed that flag are not necessarily racist. They might be. But it's more -- they're saying -- they're declaring that they're rebels.

SNOW: But one U.S. historian said that explanation doesn't wash with many who see the confederate flag as a symbol representing bigotry.

PROF. JIM ROARK, EMORY UNIVERSITY: For some Americans -- rightfully so -- it represents tyranny. It represents racism. It represents violence.

SNOW: For Vice President Cheney, one political observer said it was a symbol he should have avoided.

LARRY SABATO, UNIVERSITY OF VIRGINIA CENTER FOR POLITICS: They have dozens of staff and advance people who work for days, or even weeks, planning a visit like this. It's difficult to believe they could have missed something like this.

(END VIDEO TAPE)

SNOW: Now, the controversy was brought to the attention by the Reverend Al Sharpton. The "Daily News" had gone to him, showed him the photograph. And then he called on Vice President Dick Cheney to denounce the flag and to apologize -- Wolf.

BLITZER: All right, Mary.

Thanks very much for that.

Mary Snow in Upstate New York.

And we're just getting this in to THE SITUATION ROOM from the White House. The issue of the controversial matter of water boarding and whether or not that interrogation technique amounts torture.

Let's go to our White House correspondent, Ed Henry, once again -- Ed.

ED HENRY, CNN CONGRESSIONAL CORRESPONDENT: Well, Wolf, we've just obtained this four page letter that Michael Mukasey, the president's nominee to be attorney general, has sent up to Senate Democrats. This is the letter that may determine whether or not he is confirmed.

As you know, it was widely assumed that this nomination was essentially a slam dunk. Now, it's run into some peril on the question of whether or not Mr. Mukasey -- Judge Mukasey believes that waterboarding is a form of torture. So he has sent this letter to Senate Democrats, where he says: "These techniques seem over the line or, on a personal basis, repugnant to me and would probably seem the same to many Americans."

So on a personal basis, he's saying it is repugnant. But then he tries to make a legal distinction and says: "But hypotheticals are different from real life and the actual facts and in any legal opinion, the actual facts and circumstances are critical."

So, essentially, Michael Mukasey dodging the question of whether legally waterboarding is torture, but saying personally he believes it is repugnant.

The bottom line is the question will be whether Senate Democrats take that as a good enough answer. And that will help determine whether or not he is confirmed -- Wolf.

BLITZER: Well, we should know soon enough.

Ed Henry, thanks very much.

Barack Obama and Hillary Clinton -- they're trading sharp jabs before tonight's presidential debate even begins. You're going to find out why one campaign is being called disingenuous.

Plus, Lance Armstrong -- you're going to find out why he wants Texas to go $3 billion in debt.

Stay with us.

Lance Armstrong, right here in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: Let's go back to Carol Costello.

She's monitoring some other important stories incoming into THE SITUATION ROOM right now.

What's going on -- Carol?

COSTELLO: Well, Wolf, all financial eyes are on the Federal Reserve, meeting in Washington right now and expected to announce a cut in interest rates tomorrow. Chairman Ben Bernanke and his fellow Fed officials are focusing on the credit crunch and housing slump resulting from the subprime mortgage meltdown. Today, they injected $17 billion into the financial system to help ease the growing credit crisis.

They just can't get a brake on this shuttle mission. A solar panel on the International Space Station tore while it was being moved and a rotary joint on another panel isn't rotating the way it's supposed to. Neither problem poses a threat to any of the astronauts, but it could mean another extension of Discovery's mission.

California Governor Arnold Schwarzenegger is quoted as saying marijuana is not a drug, it's a leaf. He allegedly made that statement in an interview with the British edition of "G.Q.". Schwarzenegger has admitted to smoking pot. He was even seen with a joint in the 1977 documentary "Pumping Iron." A spokesman says the governor was joking and his words were being taken out of what he calls a silly entertainment context.

It is a drug that comes from a leaf. That is true.

BLITZER: All right, Carol.

Thanks very much.

We'll get back to you shortly.

New York's governor taking on CNN's Lou Dobbs.

(BEGIN VIDEO CLIP)

SPITZER: I'm not going to demean myself by getting into a back and forth with somebody who, on TV, spews venom and hate and fundamental misinformation.

(END VIDEO CLIP)

BLITZER: The debate over driver's license for illegal immigrants gets heated and personal. We're going to hear from both sides. Lou Dobbs standing by in THE SITUATION ROOM.

Also, Oprah Winfrey -- a tearful apology after allegations of abuse at her school in South Africa.

And the fight against cancer -- you're going to find out if Vitamin D really helps to ward off the disease. A just released first of a kind study. We have the results.

Stick around.

You're in THE SITUATION ROOM.

(COMMERCIAL BREAK)

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

Happening now, residents of Southeast Florida are being warned to keep an eye on Tropical Storm Noel, already blamed for a dozen deaths in the Caribbean. Outer bands of the storm could hit Florida by tomorrow night. We're watching this.

Also, the United Nations General Assembly urging the U.S. to end its economic embargo against Cuba. It approved a resolution calling for an end to that policy for the 16th year in a row.

And Vitamin D apparently is not the cancer fighter many people thought it was. Results of a new study just released last hour show Vitamin D does not -- repeat -- does not lower the overall risk of dying from cancer.

I'm Wolf Blitzer.

You're in THE SITUATION ROOM.

Their job is to protect the public from unsafe products. They've been offered more funds to do their job, but their boss says no thanks.

Let's go to CNN's Brian Todd.

He's watching this for us.

All right, explain what's going on -- Brian.

BRIAN TODD, CNN CORRESPONDENT: Well, Wolf, this has been dubbed the year of the recall. Millions of consumer products have been deemed unsafe. Now, the head of the agency that's supposed to protect consumers is resisting a bill that would give her more money and more resources. And she is under fire.

(BEGIN VIDEO TAPE)

TODD: From toothpaste to toys. The wave of product recalls in the U.S. has reached crisis levels. The agency tasked to protect Americans from tainted goods has been understaffed, under funded for decades. One of its key testing labs looks like it belongs in a high school. Now, democrats in Congress want the acting head of the consumer product safety commission to resign. That's because she is against parts of a bill that would double her agency's budget, add staff and give it real teeth to protect us from things like lead-based toys.

REP. BOBBY RUSH (D), ILLINOIS: She needs to go. She needs to resign. She needs to get out of the way.

NANCY NORD, ACTING CHAIR, CPSC: I have no intention or immediate plans to resign, of course not.

TODD: Fighting a political onslaught, Acting CPSC Head Nancy Nord says one proposal that would drastically hike penalties for companies that violate safety standards would flutter agency with flimsy complaints. Consumer advocates couldn't disagree more.

DONALD MAYS, CONSUMERS UNION: There needs to be tougher civil penalties that would be true deterrents for manufacturers breaking those laws.

TODD: Nord says there are practical reasons why she opposes some provisions in the bill, like the one that would virtually eliminate lead from all toys.

NORD: The problem is that we need to make sure the legislation is both practical and enforceable and I have raised some concerns about the enforceability.

TODD: Critics say Nord is simply following the Bush administration's lead against regulating big business. She was once a corporate lawyer, but she told us it is that crowd she is trying to avoid.

NORD: There are provisions in this legislation that are going to increase litigation and result in this agency ending up being in court. I don't want to be hiring lawyers. I want to be hiring safety inspectors.

(END VIDEO CLIP)

TODD: Still the Senate Commerce Committee this afternoon approved that bill that would beef up the CPSC. As for Nancy Nord, a White House official told us they support her and they accuse democrats of politicizing consumer safety. Wolf.

WOLF BLITZER, CNN ANCHOR: All right, Brian. Stay on top of this story for us. Brian Todd reporting.

So should your state take on new debt to fund the fight against cancer? Texas residents will answer that question on their Election Day ballots. It would require amending the state constitution to issue special bonds. Lending his support, a legendary cycling champion and cancer survivor.

(BEGIN VIDEO CLIP)

And joining us now in New York is Lance Armstrong.

Lance, thanks very much for joining us. Why is this so important right now to get this proposition 15 passed in Texas, which would what? Provide about $300 million a year, $3 billion over ten years for cancer research in the state of Texas?

LANCE ARMSTRONG, 7-TIME TOUR DE FRANCE CHAMPION: Well, I'll tell you two things. Number one, it's the opportunity for the state of Texas and its people to send a message, not only around the state, but around the country and around the world that despite cuts at the federal level, the state of Texas is going to step it up and spend $3 billion and invest $3 billion in ultimately saving lives of not only future Texans but future Americans and for people all over the world.

BLITZER: You have a lot of support in Texas, but you also have those who say, you know what? This is $300 million a year, $3 billion over ten years that could be used for education, for other priorities in the state. Why isn't - why should the federal government be spending the billions to really deal with cancer prevention and research?

ARMSTRONG: Well, the federal government should be, but for the second or third year in a row, we've seen a cut at the budget at the National Cancer Institute and what I would remind anybody with that argument is that the disease, cancer itself, costs the state of Texas $30 billion a year in direct and indirect costs. So for us to have the opportunity to invest $300 million to try to offset a serious, serious number like $30 billion a year, I think it's a wise investment and it's the proudest thing I have ever been involved in my state.

BLITZER: I've read some of the criticisms from some groups out in Texas. I don't know how significant it is, but they're worried that some of the money, if this proposition passes, could be used for embryonic stem cell research, which they strongly oppose. What do you say to them?

ARMSTRONG: Well, it's interesting because I've always been supportive of stem cell research and I always will be, I believe. But this is not, this is not a stem cell issue. This is not a California stem cell initiative which a lot of people align it with or sort of relate it to. This is a cancer research and prevention initiative.

BLITZER: The first President Bush is a strong supporter of this initiative and is working closely with you in it. Are there any significant opponents that you fear will stand in the way and derail this proposition 15?

ARMSTRONG: I think our biggest fear is voter apathy, just having people show up. I mean we need turnout. We need to -- that's why I've been campaigning for the last full month and asking Texans to come out and not only vote, but vote for proposition 15. But if you don't have people show up and you don't have them voice their opinion and cast their vote, then you could have some, you know obviously, some fiscal conservatives show up and just say, listen, we don't want to spend money for anything. But, again, this is a bipartisan issue. As you said, former President Bush has been a supporter, as well as people on the other side. Cancer doesn't care if you're a republican or you're a democrat, if you're young or you're old. It just simply doesn't care. So we have to invest the money and the resources to ultimately defeat it.

BLITZER: The election is November 6th, proposition 15 at stake. Lance Armstrong, thanks for joining us.

ARMSTRONG: Thank you.

(END VIDEO CLIP)

BLITZER: A high-profile verbal smackdown and it's getting personal right now. It's between New York's Governor Eliot Spitzer and CNN's Lou Dobbs. It's reaching new levels. Lou, standing by live to talk about it.

Also, the school scandal that reduced Oprah Winfrey to tears; a criminal probe now rocking her school's academy. Her girls' academy, that is.

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

(COMMERCIAL BREAK)

BLITZER: A verbal smackdown between Democratic New York Governor Eliot Spitzer and CNN's own Lou Dobbs is reaching new heights. It's over the controversial issue of drivers' licenses for undocumented immigrants. Lou is standing by to join us in a moment.

Let's get some background from CNN's Deborah Feyerick, first.

Deb, what is this all about?

DEBORAH FEYERICK, CNN CORRESPONDENT: Well Lou, these days when it comes to immigration policy, take a stand and you're bound to put yourself directly in the line of fire, regardless of where it is you may be standing.

(BEGIN VIDEO CLIP)

If you haven't been tracking the fight between New York's Governor Eliot Spitzer and CNN's Lou Dobbs, here's some of what you have missed.

LOU DOBBS, CNN ANCHOR: And the reason I call him an idiot, by the way, is he called me anti-immigrant. So he started it. I guarantee you, Governor, I ain't quitting until you do.

FEYERICK: The fight erupted over drivers' licenses; specifically Governor Spitzer's proposal late last month to allow and estimate one million illegal immigrants in New York to register for one.

GOV. ELIOT SPITZER, NEW YORK: We want security. We want our roads it be safe, which is the initial impetus behind letting them get a license so we know who they are, where they are.

DOBBS: Your policies are idiotic, but I have to apologize for calling you an idiot. And it is actually a sincere apology. I'm kind of embarrassed that I got so frustrated that I did that.

FEYERICK: The CNN anchor did apologize moments after the original name calling. Still, Dobbs hasn't let up. He argues those licenses would actually undermine security and give illegal immigrants a chance to register to vote, simply by checking off the voting box on the license application regardless of the threatened penalty.

SPITZER: I am not going to demean myself by getting into a back and forth with somebody who on TV spews venom, hate, and fundamental misinformation; of course not. He knows it. This has absolutely nothing to do with voting. This is something seven other states do for security. The Director of Homeland Security has said we improve security, by knowing who is there.

FEYERICK: The governor denies voter fraud will be a problem. Still, after a month of controversy, Spitzer over the weekend did unveil a new plan. New York will now have three distinct licenses, one for citizens, one for people crossing into Canada, and one for illegal immigrants to drive and use as I.D. As for that war of words ...

SPITZER: As I said, it's beneath me, it's beneath my office to in any way involve myself with Lou Dobbs and I think his knowing spread of venom is beneath CNN, as well.

(END VIDEO CLIP)

FEYERICK: Now, the debate is not likely to go away. As for who will get the last word, Wolf, I leave that to you. BLITZER: All right. Thanks very much, Deb Feyerick with some background.

Let's talk to Lou right now. He's joining us from his studio in New York.

All right. Those are tough words we heard from the governor; spewing venom, hate and fundamental misinformation; a direct attack on you, Lou, go ahead.

DOBBS: Well, you say go ahead. I wouldn't want to in any way stoop to the level of the governor in suggesting, you know, that this man who I've apologized for calling him an idiot when I really only think that his policies are idiotic, an absolute betrayal of the citizens that he has been elected to represent. The governor is making a few oversights here that perhaps we ought to correct.

One, he has said that he wants this drivers' license for illegal immigrants and aliens to lower insurance. We know for a fact that that's one of the reasons that some of the states have rolled back their plan to do just that. It's because they found insurance rates went up, not down.

He said it was about security, which is utter nonsense. The fact is the security is in knowing who is legally in this country. This governor -- the truth of the matter is, he has no idea what he is talking about here, Wolf.

BLITZER: Well, let me ask you Lou. Specifically on the point that he makes ...

DOBBS: Sure.

BLITZER: That the specific form of a driver's license that illegal immigrants could get in New York State, a million of whom apparently live there, that they wouldn't be able to use this driver's license to, a) get on a plane because it says not for federal inspection and that they wouldn't be able to use it to register to vote.

DOBBS: Well, now, that's interesting because, let me point out to you that this is only occurring after the good governor or Prince Eliot, as he seems to think of himself, has met the opposition, not only my humble self, but nearly three-fourths of the New Yorkers surveyed in recent opinion polls who say this governor is completely out of his mind on this issue. He and then he meets with his good friend, the Director of Homeland Security, Michael Chertoff, and has the audacity to say here on CNN that the Director of Homeland Security has approved this plan. Let me explain very clearly to the governor, if I may, Wolf, Director of Homeland Security Secretary Michael Chertoff does not believe states should be giving illegal aliens drivers' licenses. He forgot to mention that.

BLITZER: Even if the driver's license says you can't use this to go through security checkpoint at an airport? You can't use it to register to vote? DOBBS: If that's the case, let me ask you something. When did this occur? It occurred this weekend, did it not?

BLITZER: That's right.

DOBBS: It's a reversal from five weeks ago, which is what I've been saying that this governor should do. The man has finally admitted defeat. Then he creates all of this obfuscation around it. He's got now three, three drivers' licenses for the people of New York. It's an absolute -- it's just a joke.

And this governor, by the way, he needs, he needs to put up a little license. I wish the state would give Governor Spitzer a license that says and on it, stamp it with a learner's permit. The man is arrogant. He has been abusing his power, pandering, pandering to socioethnocentric interests at the expense of the interests of the citizens he is supposed to be representing. Now, when he says I'm spewing hate and venom and I'm anti-immigrant, the governor is a liar. Point blank. I call for increases in legal immigration in this country. I am pro-immigrant. This governor and the other lobbyists for open borders and amnesty for illegal aliens love to obfuscate and conflate illegal immigrants and immigration and haven't got the straight forwardness, the character, the honesty to say what they mean. We're talking about stopping illegal immigration, denying rights that are those properly of American citizens being given to illegal aliens. It is not the purview of this governor. It is his responsibility to protect the public and to represent citizens. And that is all I have to say to the good Prince Eliot, as he styles himself, I think these days.

BLITZER: We invited him to join us here in THE SITUATION ROOM. He declined. He was on "AMERICAN MORNING" this morning. He spoke to Kiran Chetry.

DOBBS: Let me just say, though, Wolf, it's obstructive. I have been asking this governor to join me on the air and he has the temerity to talk about spewing venom when he is lying through his teeth on this issue and doesn't have the guts to come on my air and confront me directly and confront the audience and say what he has been saying straight to my face and defend his policies. And it's one of the reasons this governor has had to reverse course, again, and eventually one hopes he's going to understand what his responsibilities are and take seriously the idea that this is a democracy, not autocracy designed for elitists like himself.

BLITZER: All right. Well, we'll be happy to invite him to join us in a debate with you. Both of you would be welcome to debate this issue a very important issue.

DOBBS: I accept.

BLITZER: You accept. We'll see if he accepts here in THE SITUATION ROOM.

Lou, tell us what is coming up at the top of the hour. DOBBS: Well, we're going to be talking about Governor Eliot Spitzer. What do you think about that? Then I'll be talking with his Deputy Secretary for Public Safety, Michael Balboni. He will also be reporting on the seething anger now on Capitol Hill over the Bush administration's complete failure to protect American consumers from dangerous imports and it's by design, I may point out and will point out, I assure you at the top of the hour, Congressional democrats and others now calling for the immediate resignation of the acting chairman of the Consumer Product Safety Commission. You probably didn't know we had such a commission. And the White House trying to impose its faith based economic policies and so-called free trade agenda on the American people, still. We'll have that special report and war on the middle class.

And among my guests here, four of the best radio talk show hosts in the country. We're going to talk about, among other things, Eliot Spitzer. Please join us.

Wolf, back to you. Great to talk with you.

BLITZER: Thank you very much, Lou. Lou Dobbs, coming up in a few moments.

Also coming up here in THE SITUATION ROOM, allegations of abuse at Oprah Winfrey's new school. The talk show star flies to South Africa to apologize in person.

Plus, Barack Obama and Hillary Clinton taking swipes at each other before they even step onto the stage to debate tonight.

Stick around. You're in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: Tonight's democratic debate may give Hillary Clinton's rivals a chance to cut into her big league. Barack Obama is taking his gloves off but even before his first real jab, the Clinton camp is already counter punching. Listen to this from Mark Penn. He's Clinton's chief campaign strategist. He says, "Considering that both Senators Obama and Edwards made their names by pledging to be positive, the last thing one would have expected was for either of them to go out and announce with pride that they were now going to go negative on a fellow democrat."

Let's get some analysis from Gloria Borger. She's our senior political analyst.

Going negative for Obama as Mark Penn suggests. What is going on?

GLORIA BORGER, CNN SENIOR POLITICAL ANALYST: Well, let me read to you something that David Excelrod said it me this afternoon. I caught him while he was on a break. He's briefing Senator Obama for this debate this evening.

BLITZER: He's the strategist for Obama. BORGER: He is. He's a chief strategist and he wasn't pulling any punches, Wolf. Look what he said. He said "It's the height of disingenuousness for these people who run a hardened political machine, to turn around and profess any legitimate exchange is out of bounds." So Wolf, he's basically calling the Clinton campaign a bunch of hypocrites, saying that they know how to attack and they attack when they have to and he also said to me, look, we know how to distinguish ourselves from Senator Clinton without attacking her. That's what campaigns are about. They're about the differences between candidates.

BLITZER: What does Obama need to specifically do tonight?

BORGER: well, he does have to point out some differences with Hillary Clinton and he has to do it on issues that are about the future. He has to talk about social security, has to talk about healthcare and he also has to say, look, I admire Hillary Clinton personally, but maybe it's time to turn the page. Maybe we need a change in this country and I'm part of that new generation and she's the old status quo.

BLITZER: Gloria, we'll be watching. Thanks very much.

Let's check in with Jack Cafferty. He has the Cafferty File in New York. Jack.

JACK CAFFERTY, CNN CORRESPONDENT: Joe Biden wants to put another 50,000 cops on the streets in America's cities. The question is, is putting more police on the streets the answer to rising violent crime? It's been going up for the last couple years.

Thomas writes from Florida, "Putting more cops on the streets of our cities is a good thing, but not a solution. It is just a Band-Aid for a severed artery. We all know improving the economy reduces crime in any particular area. If we monumentally improve our educational system, most of our country's problems will just disappear by themselves within a generation or two." Not sure, Tom, that most of us want to wait that long.

A. writes from California, "Absolutely. I live in the San Francisco Bay area where our local news reports multiple homicides each week. Criminals need to know there is someone visible that will hold them accountable and law abiding citizens need to know our policies are readily available to protect and to receive information regarding those crimes."

Brent in Idaho, "Additional cops won't make a difference until our southern border is secured. Think about it, our crime rate is up because the amount of illegal aliens crossing our southern border is up."

Doug in New Hampshire writes, "More police a good short-term response, but it doesn't solve the problem. We need better public education, early child care and other social services in order to prevent kids from growing up to be violent criminals in the first place." And Chris writes from Virginia, "My son-in-law is a cop. He's smarr, compassionate, very good at what he does. I'm proud of him. But he's overworked, and sometimes I fear for him, my daughter and their two sons. Yes, please, our police need all the help they can get."

If you didn't see your e-mail here, you can go to CNN.com/CaffertyFile, where we post more of them along with video clips of the Cafferty File. Wolf.

BLITZER: Jack, thank you.

Oprah Winfrey's school for girls is hit by allegations of abuse. Why that hit so close to home for the talk show host. We'll tell you about her emotional reaction and more.

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

(COMMERCIAL BREAK)

BLITZER: A criminal investigation is now under way into allegations of misconduct at the school Oprah Winfrey opened for girls in South Africa, allegations that reportedly drove the talk show host to tears.

Let's go out to Los Angeles. CNN's Kareen Wynter is standing by.

Kareen, what exactly are these allegations?

KAREEN WYNTER, CNN CORRESPONDENT: Hi there, Wolf.

Well, first of all, we did speak with Oprah Winfrey's representatives a short time ago. Now they confirmed to us that Winfrey flew to South Africa twice this month to meet with parents of children in her famed Leadership Academy. Wolf, this comes amidst startling abuse allegations at her South African school for girls.

(BEGIN VIDEO CLIP)

South African police confirm to CNN they have opened a criminal investigation after one abuse allegation surfaced at Oprah Winfrey's Leadership Academy for Girls near Johannesburg. Investigators wouldn't say if the abuse is physical or sexual, but they say no charges have been filed as yet. Both school officials and Winfrey have commented little on the alleged scandal. Winfrey, who's spoken publicly about her own abuse as a child, released this statement on her website saying, "Nothing is more serious or devastating to me than an allegation of misconduct by an adult against any girl at the Academy." The CEO of Winfrey's Leadership Academy also said they had initiated an internal inquiry, based on a claim of misconduct involving a dormitory parent who is no longer on campus. And that South Africa's Child Protection Services had been notified. U.S. and South African investigators are also involved. When Winfrey visited the school this month, according to South Africa news outlets, the talk show queen was so distraught over the allegations that she tearfully apologized to students and parents during an emergency meeting. Earlier this year, during the opening of the famed $40 million private academy, a beaming Winfrey told CNN, this is what she was born to do.

OPRAH WINFREY, TALK SHOW HOST: The dream for me was to create a school that I would most want to attend.

WYNTER: This crisis has now put Winfrey on damage control, as she vows to do everything possible to ensure the safety and well being of her students, some of South Africa's poorest.

(END VIDEO CLIP)

The national prosecuting authority now has the case and is making a decision, Wolf, as to whether or not to press charges. Wolf.

BLITZER: We've heard, Kareen, a school administrator is now on leave. The question is this is, is that related at all to this issue?

WYNTER: Well, school officials are telling us that this is the head of the academy and this is just really to ensure an impartial investigation and that this person, right now, isn't the subject of a probe, Wolf.

BLITZER: All right, Kareen. Kareen Wynter reporting to us from Los Angeles, thank you.

This programming note to our viewers, mark your calendars. Starting on Monday, that's exactly one year from Election Day 2008, THE SITUATION ROOM will be on the air for three hours back-to-back from 4:00 p.m. eastern until 7:00 p.m. eastern. Lou Dobbs will start his program, he'll move from 6:00 to 7:00 p.m. eastern.

And, by the way, tonight, we're back in one hour at our regular time, 7:00 p.m. eastern.

Until then, thanks very much for joining us. I'm Wolf Blitzer in Washington. Lou Dobbs tonight starts right now. Lou.

DOBBS: Wolf, thank you very much.

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