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President Bush: "Iran is Dangerous"; Dems Pounce on Iran Report

Aired December 4, 2007 - 16:00   ET


WOLF BLITZER, CNN ANCHOR: Happening now, President Bush says Iran was, is and will be dangerous. Does a new U.S. government intelligence report that Tehran stopped its nuclear weapons program a few years ago change anything?
We're going to bring you all the key comments from Mr. Bush's news conference today, and there is lots of reaction.

I'll also talk to a one-time Bush administration insider who is clearly a hawk on Iran, the former U.S. ambassador to the United Nations, John Bolton Has the intelligence community's decisions about Iran's nuclear threat changed his mind?

Plus, the sparring Democratic presidential candidates unite and blasting President Bush when it comes to the situation with Iran, but their debate in Iowa today was no love-fest at all. The first contest of 2008 is getting wilder and nastier by the day.

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

As President Bush tells it today, he still thinks Iran could ignite World War III if it developed a nuclear bomb. At a morning news conference over at the White House, the president was pummeled with questions about newly declassified U.S. intelligence showing Iran actually stopped its nuclear weapons four years ago. The national intelligence estimate, or the NIE, as it's called, represents the views of 16 intelligence agencies within the president's own administration.

Let's go to our White House correspondent, Ed Henry. He's standing by live now.

You were at that news conference at the White House earlier today. And the president clearly was grilled by reporters on this latest NIE.

ED HENRY, CNN WHITE HOUSE CORRESPONDENT: Wolf, you're right, he was. And it all boiled down to questions of credibility and whether this was a painful replay of the mistakes made leading up to the war in Iraq.


HENRY (voice over): Classic President Bush. Confronted with new facts on Iran, he insisted the national intelligence estimate changes nothing. GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: I think the NIE makes it clear that Iran needs to be taken seriously as a threat to peace. My opinion hasn't changed.

HENRY: But the intelligence has changed, with the president's own administration now declaring Iran suspended its nuclear weapons four years ago. Mr. Bush called that a great discovery but warned Iran could restart the program at any time.

BUSH: Iran was dangerous. Iran is dangerous. And Iran will be dangerous if they have the knowledge necessary to make a nuclear weapon.

HENRY: The president was hit with a barrage of questions about how U.S. credibility was damaged by hyped intelligence before the war in Iraq and whether he made the same mistake with Iran in October.

BUSH: If you're interested in avoiding World War III...

HENRY: Mr. Bush insisted he made that comment before he learned of the new report, though he acknowledged his director of national intelligence gave him an inkling something was up last summer.

BUSH: I was made aware of the NIE last week. In August, I think it was John -- Mike McConnell came in and said we have some new information. He didn't tell me what the information was. He did tell me it was going to take a while to analyze.

HENRY: But Senator Joe Biden, a Democratic presidential candidate, said he refuses to believe the president got tipped off in August and didn't follow up until last week. "If that's true," Biden told reporters, "He's one of the most incompetent presidents in modern American history."


HENRY: Now, White House officials dismiss that as presidential posturing by Biden, but there are senators now in both parties who are raising questions about why the intelligence community did not tip them off sooner to a change in intelligence. Republican Lindsey Graham saying today that he thought Iran was pursuing nuclear weapons and he wishes someone had come to him and said, whoa, time out, there's some new intelligence, you need to check out -- Wolf.

BLITZER: Ed, stand by for a moment, because there was another moment at the news conference I want to talk about. It was a surprisingly personal moment for the president.

Ed asked him about the case of that 19-year-old Saudi woman who was gang-raped by seven men. The victim was later sentenced to 200 lashes because she was alone in a car with a man who wasn't her husband or relative.

Let's listen to the president's answer.

(BEGIN VIDEO CLIP) GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: My first thoughts were these: what happens if this happened to my daughter? How would I react?

And I would have been -- I would have been -- I'd have -- I'd have been very emotional, of course. I'd have been angry at those who committed the crime. And I'd be angry at the state that didn't support the victim.

And our opinions were expressed by Dana Perino from the podium.

HENRY: Have you pressed King Abdullah about it personally?

BUSH: I talked to King Abdullah about the Middle Eastern peace. I don't remember if that subject came up.

HENRY: But if it's that important to, why wouldn't you bring it -- at that level, bring it directly at King Abdullah?

BUSH: He knows our position loud and clear.


BLITZER: All right. Let's talk a little bit about that. It's a very, very sensitive subject, U.S./Saudi relations. Clearly, the United States dependent on Saudi oil. There's a strategic relationship, but, of course, half the population there, the women, are treated in ways that, because of the Islam religion, the way it's interpreted there, treated in ways that they wouldn't necessarily be treated anyplace else.

So this is a really sensitive issue for the White House to deal with.

HENRY: It really is sensitive politically. And it's quite interesting.

The president almost never injects his daughters into any sort of public policy debate, especially not one as explosive as this. So I found that very interesting in his answer as a father, answering that way. But as a president, as a commander in chief, as you say, this is a very delicate political situation, and the fact that he is not pressing the Saudi king on this is very telling amid allegations that the White House has been tiptoeing around the Saudi royal family.

And I think obviously the question of credibility in the Mideast also a question of credibility on Iran with this new NIE. So obviously the president faced a lot of tough questions -- Wolf.

BLITZER: Ed Henry over at the White House for us.

Thank you.

Let's get some facts now on this national intelligence estimate, the source of that new information about Iran's nuclear program. It's produced by the National Intelligence Council. That was formed in the 1970s to serve as a bridge between all of the various intelligence communities and the officials who make policy.

Estimates are usually requested by policymakers to examine national security threats and vulnerabilities now and in the future. The National Intelligence Council made changes to the estimate writing system after the 2002 report on Iraqi weapons of mass destruction that was later found to be wrong.

The Democratic presidential candidates right now seizing on the news that Iran stopped development of a nuclear bomb back in 2003, and they are pouncing on President Bush's claim that the report doesn't really change anything.

Let's get some more now approximate on the Democrats, what they are doing on this issue, and how this is impacting the political campaign.

We'll turn to our senior political analyst, Bill Schneider.

It's a huge issue for the Democrats, what is happening with Iran right now, and the political fallout from this NIE is rather significant.

WILLIAM SCHNEIDER, CNN SR. POLITICAL ANALYST: Well, Wolf, it changes the debate from war and peace to competence and deception.


SCHNEIDER (voice over): In October, President Bush talked about a nuclear Iran causing World War III. New intelligence makes the threat look far less imminent.

BUSH: I view this report as a -- as a warning signal that they had the program, they halted the program. And the reason why it's a warning signal is that they could restart it.

SCHNEIDER: Americans may have been alarmed by the prospect of a nuclear Iran, but they're even more alarmed by the prospect of war with Iran. Last month, 70 percent of Americans opposed U.S. military action against Iran. Democratic voters were nearly unanimous in their opposition. Iran had already become a flash point in the Democratic campaign.

SEN. HILLARY RODHAM CLINTON (D-NY), PRESIDENTIAL CANDIDATE: I and 75 other members of the Senate voted to give the president authority in a non-binding resolution to label the Iranian Revolutionary Guard and its leadership as a terrorist organization.

SCHNEIDER: That vote drew vigorous criticism from her opponents.

JOHN EDWARDS (D), PRESIDENTIAL CANDIDATE: I don't believe you can say I'll stand up to Bush on invading Iran and then vote with him when the vote comes. SCHNEIDER: The Clinton campaign may be relieved that military action, which would have inflamed Democrats, now seems less likely. But her opponents are keeping up the pressure.

"It's easy to say, 'Fool me once, shame on George Bush,' but when she's been fooled twice, shame on her," Chris Dodd said.

Republican voters favor military action against Iran, which puts them way out of sync with the rest of the country. It also puts pressure on Republican candidates to sound hawkish, nervously hawkish.

JOHN MCCAIN (R-AZ), PRESIDENTIAL CANDIDATE: You know that old Beach Boys song, Bomb Iran? Bomb, bomb, bomb -- anyway...

SCHNEIDER: Now Republican candidates have to deal with the issue, did the Bush administration knowingly disregard or misrepresent the intelligence about Iran?


SCHNEIDER: So Iran now becomes a very different issue. Not the threat of war, the question of mistrust and incompetence -- Wolf.

BLITZER: Thanks very much.

Bill Schneider reporting for us.

Let's check in with Jack Cafferty. He's got "The Cafferty File," joining us from New York.

I know in our 6:00 p.m. hour we're going to talk in our roundtable about this, Jack, but it's pretty embarrassing when you think about it.

JACK CAFFERTY, CNN ANCHOR: I was going to say, we have got to look like the gang who couldn't shoot straight to the rest of the world. We've got a president pounding the desk saying Iran is going to start World War III, and then we have our own intelligence people saying, hey, they gave that program up four years ago.

I mean, it's embarrassing. That's the right word. And it's shameful. I mean, we ought to be better than that.

Congress is back this week, speaking of people who don't do things very well. They will be in session for three whole weeks. And then, of course, they have got to take off -- what, is it a month or something for Christmas?

Not that it matters. They've managed to accomplish next to nothing in the time that they did show up for work so far this year. But the nation's business is waiting, and thanks to Congress' inability to function, there is a long list of issues that must be addressed.

Taxes -- they need to pass a temporary fix to the alternative minimum tax or else 20 million American taxpayers will get hit with tax increases of about $2,000.

Spending -- the Democrats vow to bring the appropriations process to a close. This is something on which they've done virtually nothing. And some critics think Congress will just end up passing another stop-gap funding bill. That would be my guess.

Paying for the war -- President Bush insisting Congress pass his additional $50 billion war funding request.

Energy -- Democrats have agreed to move ahead with legislation that will raise car fuel economy standards, increase the use of ethanol, and boost the use of alternative fuels.

A farm bill -- the Senate hopes to finish a bill extending farm subsidies and food programs.

Wire-tapping -- the Senate could vote as early as this week to renew the Foreign Service Intelligence Act, which is fondly known as the wire-tapping without a warrant act.

And children's healthcare -- negotiations expected to continue on expanding the S-CHIP program by $35 billion over five years.

Don't hold your breath on much of any of this getting done.

The question is this: What's the single most important task Congress must complete, in your opinion, before adjourning for the holidays?

E-mail your thoughts in that to or go to

It's hard to imagine, but they might be worse than the Congress before them. And the Congress before them was worthless.

BLITZER: Jack, thank you for that.

Jack will be back soon.

If you think President Bush talks tough about Iran, consider his former United Nations ambassador, John Bolton. He suggested Iran is on the road to nuclear holocaust. I will ask Ambassador Bolton if he and the Bush administration simply got their facts, their dire warnings, wrong.

That is coming up next.

Also, landslides, torrential rain, flooding, it's happening right now in the United States. An emergency situation in two states.

We'll have details.

And later, it's becoming quickly the hottest ticket in town, and wouldn't you know Oprah is involved. But will it translate into votes for Barack Obama?

Stick around. You're in THE SITUATION ROOM.


BLITZER: President Bush is refusing today to downgrade his view of the Iranian nuclear threat. He says even if Iran stopped its nuclear weapons program four years ago, it still could start it up again down the road. But will that newly declassified intelligence information sway others who still have a very get-tough approach toward Iran?

I'm joined now by the former U.S. ambassador to the United Nations, John Bolton. He's the author of the new book "Surrender is Not an Option: Defending America at the United Nations and Abroad."

Mr. Ambassador, welcome back.


BLITZER: Well, does it change your view about the threat coming in from Iran?

BOLTON: No. I think in the first place there is a artificial distinction in this estimate between so-called civil activities and military activities.

The estimate itself says Iran continues its uranium enrichment program. And what that means is Iran is building up an inventory of at least low-enriched uranium, that it's at Iran's discretion when to convert that fissile material into a nuclear weapon.

So I think there are a lot of questions about this estimate, which is only an analyst's judgment. And I don't think I would change my view of the threat that Iran poses.

BLITZER: But they specifically say that back in 2003, they've only recently confirmed and learned -- this is the 16 agencies involved in the U.S. intelligence community -- that back four years ago, the Iranians flatly suspended any nuclear weapons program that they clandestinely had earlier. That's new information, and it clearly would indicate that the president and all of his top advisers who were so worried about Iran's nuclear threat were wrong.

And I assume that includes you, as well?

BOLTON: Right. Well, that's one reason I'm suspicious about the conclusion here, that this took four years to find out.

And by the way, two agencies dissent from that conclusion. And even what was published says that the NIE itself only has moderate confidence that the suspension in 2003 continues today and that there are gaps in our intelligence. I think there's a real risk here of over-judging what the intelligence community found and that there is a real risk of disinformation on the part of Iran.

BLITZER: So let me just -- let me -- this is a significant point that you're raising. You're saying that this new NIE, the one that was just issued, 2007, is potentially wrong? Is that what you're saying? And that it was released for, what, political purposes?

BOLTON: Well, I think it's potentially wrong. But I would also say many of the people who wrote this are former State Department employees who, during their career at the State Department, never gave much attention to the threat of the Iranian program. Now they are writing as members of the intelligence community, the same opinions that they've had four and five years ago.

BLITZER: President Bush says he has confidence in this new NIE, and he says they revamped the intelligence community after the blunders involving weapons of mass destruction in Iraq. He says there's a whole new community out there and he has total confidence in what the national intelligence director is doing.

BOLTON: Well, I have to say I don't. I think there's a very real risk here that the intelligence community is like generals fighting the last war. They got Iraq wrong and they're overcompensating by understating the potential threat from Iran.

I really think this is something the House and Senate intelligence committees need to get into in a very big way to probe as they can do behind closed doors how this estimate was put together. There is another issue here.

The only thing that has been made public are the general conclusions, two pages, not the 140 or 150 pages underlying it. Obviously, that information is very sensitive, but I'd like to know what the decision was to allow the headlines to get out without the underlying facts for people to evaluate.

BLITZER: The president said he authorized the release of this NIE this summer and there will be hearings on the Hill.

A few weeks ago, I interviewed the director general of the IAEA, the International Atomic Energy Agency, Mohamed ElBaradei, and he basically said then what the NIE says now, and I want to play this clip for you. I played it for you in the past.

Listen to what Dr. ElBaradei said.


BLITZER: Do you believe there is a clandestine, secret nuclear weapons program right now under way in Iraq?

DR. MOHAMED ELBARADEI, IAEA DIRECTOR-GENERAL: We haven't seen any concrete evidence to that effect, Wolf. We haven't seen any information that there is a parallel, ongoing, active nuclear weapons program.


BLITZER: The last time I played that clip for you a few weeks ago, you said he was an apologist for Iran.

Now, you want to revise or amend that comment? Because he now seems to be pretty much in line with the U.S. government's intelligence community.

BOLTON: Well, I don't want to revise it, and he's not in line, because the NIE itself says they did -- Iran did have a military program, at least until 2003, which ElBaradei still disagrees with and which the Iranians continue to deny. That's one of the reasons Iranian credibility is so much in question and why the prospect of disinformation I think is very real here.

BLITZER: In your book "Surrender is Not an Option," you write this on page 340. "The fact is that Iran will never voluntarily give up its nuclear program, and a policy based on the contrary assumption is not just delusional, but dangerous. This is the road to nuclear holocaust."

Now, in the NIE, they contradict that. They say specifically this: "Our assessment that Iran halted the program in 2003, primarily in response to international pressure, indicates Tehran's decisions are guided by a cost-benefit approach rather than a rush to a weapon irrespective of the political, economic, and military costs."

So what they're saying is that Iran, under pressure, will suspend its nuclear weapons activity.

BOLTON: In 2003, I was undersecretary of state for arms control, and I can tell you, at the time, I felt we were not imposing sufficient pressure on Iran then. I'd like somebody in the intelligence community to tell me what pressure it was in 2003 that caused Iran to get -- to make this decision, supposedly, to suspend its military program.

The only event that happened in 2003 of significance there was the overthrow of Saddam Hussein. I wouldn't call that diplomatic pressure.

BLITZER: Well, the president in his news conference today seemed to suggest the government of Iran at that time, as opposed to Ahmadinejad right now, may have been a little bit more moderate, a little bit more responsible, but unfortunately we're going to have to leave that to our next conversation down the road because we're all out of time.

Ambassador John Bolton is the author of "Surrender is Not an Option."

Always good of you to join us here in THE SITUATION ROOM. Thanks for coming in.

BOLTON: Glad to be here.

BLITZER: She's not giving away any cars this time, but Oprah Winfrey sure can draw an audience. We're tracking the tickets for one of her big campaign stops with Barack Obama.

And wait until you hear how one couple financed a romantic getaway. Watch your credit cards and driver's license. It could happen to you. Stay with us. You're in THE SITUATION ROOM.



BLITZER: Their campaign said the mud would fly. And guess what? They were right. At the Democratic presidential debate earlier today, one argument actually got so heated that one candidate accused another of crossing the line and going "way too far."

And Republican presidential candidate Mike Huckabee reportedly accomplishes something no other candidate has in this race. It concerns a giant leap in support for his bid.

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


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

Happening: Now that it appears Iran suspended its nuclear weapons program, we're probing why it did it. We have an exclusive report coming up from the only U.S. television reporter who is actually in Tehran right now.

Also, a manual not meant for you to see, and it comes out. It offers a behind-the-scenes look for life for terror detainees at Guantanamo Bay in Cuba. How are they punished? How is their behavior exploited? And might knowing this information help America's enemies? We're watching this story.

And he is always outspoken, but will the conservative commentator Pat Buchanan go so far as to push for an alternative to the Democratic and Republican parties? We will talk about that and a lot more.

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

Hillary Clinton says she is the target of outlandish political charges and that attacks against her are going way too far. Those are just a few of her words today at a Democratic president debate in Iowa.

At the NPR-IPR radio debate, Clinton's rivals blasted her for a key vote regarding Iran one day after a report now says Iran actually suspended its nuclear weapons program four years ago.

CNN's Suzanne Malveaux is following all the latest developments. She's joining us now from Des Moines.

I take it, at this radio debate that ended just a little while ago, Suzanne, things got a little heated?

SUZANNE MALVEAUX, CNN WHITE HOUSE CORRESPONDENT: Well, they did. Wolf, they did get heated. It was really a unique situation, because you had to listen very carefully. It was a radio debate, no cameras allowed. And then there those kind of punchy one-liners that really broke through this two- hour debate.

One example, Senator Biden when he was talking about Bush doctrine, calling it a three-legged stool, saying it was push the mute button, preemption, regime change. Congressman Kucinich also talking about China policy, saying, buy America or bye-bye, America.

There were three different subjects they focused on. None of them knew those topics ahead of time. Of course, it was Iran, it was China and immigration -- Iran, of course, making the most news here, all of them reacting to President Bush and the national intelligence estimate, saying that Iran stopped its nuclear ambitions to build any kind of weapon back in 2003.

But President Bush insisting that U.S. policy dealing with Iran heard changed. This gave an opportunity for all the candidates to try to distinguish themselves from President Bush.


GRAVEL: Iran's not a problem, never has been, never will be. What you're seeing right here is something very unique, very courageous. What the intelligence community has done is drop-kick the president of the United States.

SEN. BARACK OBAMA (D-IL), PRESIDENTIAL CANDIDATE: It is absolutely clear that this administration and President Bush continues to not let facts get in the way of his ideology. And that's been the problem with their foreign policy generally. They should have stopped the saber rattling; should have never started it.

SEN. JOSEPH BIDEN (D-DE), PRESIDENTIAL CANDIDATE: You cannot trust this president. He is not trustworthy. He has undermined our security in the region.

JOHN EDWARDS (D), PRESIDENTIAL CANDIDATE: What I believe is that this president, who, just a few weeks ago, was talking about World War III, he, the vice president, the neocons have been on a march to possible war with Iran for a long time.


MALVEAUX: Now, Wolf, what this also allowed them to do is give them an opportunity to essentially go after Senator Hillary Clinton, specifically on legislation that she approved which designated the Iranian Revolutionary Guard as a terrorist -- terrorist organization. Some of the candidates saying it opened up the opportunity for President Bush to do what they say was his saber-rattling, to say that, perhaps, there was a case for going to war.

Well, this is how Senator Clinton responded to those attacks.

(BEGIN AUDIO CLIP) SEN. HILLARY RODHAM CLINTON (D-NY), PRESIDENTIAL CANDIDATE: Well, there were other purposes for that resolution. It does label the Iranian Revolutionary Guard as a terrorist organization. And there is evidence that they do support Hamas and Hezbollah, as Senator Obama just said; and, in addition, have until recently, been supplying weapons and technical advisers to various factions within Iraq.


MALVEAUX: Wolf, there has been a lot of talk about the nastiness, the backbiting between the -- the front-runners in this campaign.

Obviously, a lot of tension, as well as we see the front-runners, Senator Barack Obama, Senator Hillary Clinton in a statistical dead heat. The Iowa polls show Edwards right behind them.

We were a little bit surprised that the rhetoric was not as heated as we had suspected, but we have been talking to people here in Iowa, and they say they are getting a little bit tired of it. Perhaps the campaigns acknowledging that as well -- Wolf.

BLITZER: All right, Suzanne, thanks very much -- Suzanne Malveaux on the scene for us covering this debate in Iowa.

Over on the Republican side, the knives are equally sharp, especially now that one candidate is clearly surging. Mike Huckabee has scored a sharp month-to-month boost in a national poll over at "USA Today." The paper says no other candidate, neither party, has gone up as dramatically.

And that means Huckabee must now fend off attacks and hope his newfound support will actually stick.

Let's go to Dana Bash. She's joining us now from Des Moines with more on what is happening on the Republican side.

With the good fortune comes a downside as well, Dana.


You know, it wasn't that long ago, Wolf, that Mike Huckabee drew crowds of 10, maybe 20 people max here. Today, it was standing room only. Iowans are coming out to see what all the buzz is about and to ask him some tough questions.



BASH (voice-over): He can say that again. Mike Huckabee awoke to news he has climbed from fifth to second in a national poll.

(on camera): Did you see the "USA Today"?

HUCKABEE: Oh, yes. Thrilled. BASH (voice-over): But can he take the next step?

(on camera): Can the infrastructure and organization sort of harness this popularity?

HUCKABEE: You know, everyone asks, can we take it from here? And, of course, before that, it was, can we get here? So, the answer is, yes, we got here, and, yes, we can take it from here.

BASH (voice-over): Confidence buoyed by a crushing Iowa crowd that came to hear him speak.

HUCKABEE: Where is the front of the room?

BASH: He found it and got down to business, making sure turnout here equals turnout on Election Day.

HUCKABEE: This is a commitment card that you're going to be with us on the caucus night.

BASH: Then questions from some skeptical GOP voters: Isn't he too nice to be beat the Democrats?

UNIDENTIFIED MALE: Quite frankly, I'm not looking for the nicest person.

BASH: To that, a favorite Huckabee line.

HUCKABEE: I'm the only person running for president who has actually run against the Bill and Hillary Clinton machine. And I didn't just run against it. I beat it four times in Arkansas.

BASH: Here, evidence voters are hearing from Huckabee's rivals, now spreading controversy about his record, a question about his opposition to mandatory sentencing for methamphetamine manufacturers.

UNIDENTIFIED MALE: I wanted to know why you did that and are you going to let that happen, let them roam free, early as president?

BASH: He says he is not soft on crime, but:

HUCKABEE: And you give them no incentives. Then, you really are making it more difficult to control both the prison population, as well as your costs.

BASH: And Huckabee promises not to attack his opponents. But listen carefully, and you hear a subtle dig at Mitt Romney.

HUCKABEE: A lot of people understand that they want to elect a president who knows what he believes and who believes today, running for president, what he believed before he ever thought about running for president.


BASH: And, on that critical question of whether Huckabee's come- from-behind campaign really has what it takes to build on his surge in the polls, Huckabee reported today, Wolf, that, in November, he raised more money than in the 10 months before it combined -- Wolf.

BLITZER: All right, Dana, thanks very much. Dana Bash reporting for us from Iowa.

He is the Democrat watching Hillary Clinton and Barack Obama trade attacks -- John Edwards trying to drum up more attention for his campaign. Will he get that or will he be tuned out?

Mitt Romney says it's time for him to talk about faith in America, but will he zero in on concerns that some have about his Mormon faith? Could that speech he is about to deliver ease those concerns?

And a secret manual revealed that discusses punishment for terror detainees at Guantanamo Bay and offers other details of their lives there. But does making this information public keep -- help -- actually help America's enemies?

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


BLITZER: He's not exactly the forgotten Democrat. John Edwards is, after all, part of a three-way tug of war to win the presidential caucuses in Iowa. But, while polls show he is certainly in the running, Hillary Clinton and Barack Obama are stealing a lot of his thunder.

Let's go to our senior political correspondent, Candy Crowley. She is watching all of this unfold in Iowa right now.

Sort of running under the radar screen a little bit in Iowa, but he has got a lot at stake in that state.


And, you know, you -- as you mentioned, when Clinton and Obama go at it, John Edwards has gone positive, strategically so.


CROWLEY (voice-over): John Edwards is also running.

EDWARDS: Oh, I think it's a tossup right now. I think, between Obama, Clinton and me, it's -- it's a dead heat.

CROWLEY: He is right. But wedged between two history-making marquee names with multimillions, the former senator from North Carolina often gets lost in the conversation.

EDWARDS: I have lived through this before. I know how this works. I'm actually having fun. I mean, I'm having a good time. I feel very confident and very sure-footed. CROWLEY: He certainly seems all of that, maybe because Edwards sees an opening in the free-fire range between Clinton and Obama. He is banking their bitter sound bites will backfire in notoriously friendly Iowa. So, the first and the fiercest of the Clinton critics, Edwards is dialing back now, going for the vision thing.

EDWARDS: It gets to be a very basic thing. Who are we? What is our morality? What is our character? What kind of country do we believe in?

CROWLEY: In Edwardsville, they object when you call Iowa his last stand or suggest he has put more effort or has more at stake than anyone else. Edwards was first into the state. He does have a preexisting campaign structure from 2004.

But Edwards strategists argue, others have been just as much and have every bit as much at stake. Bottom line, Edwards doesn't want to be seen after the vote as the candidate who should have won.

(on camera): And, if you lose here, it means?

EDWARDS: Depends on the circumstances. I think that's hard to predict.

CROWLEY: Can you lose well?


EDWARDS: You can lose better.

CROWLEY (voice-over): He wants to win. He could win. But there is more than one way to move on to New Hampshire.


CROWLEY: In fact, Edwards' strategists see a number of ways he can come out of here looking pretty good. He could win, of course. And then the wind would be behind him.

He could come in second to Hillary Clinton, and then they believe it will be a two-person race. Or he and Barack Obama could come in one or two. And then you have got, Wolf, a whole new ball game.

BLITZER: A lot of various scenarios. We will see what happens.

Candy, thanks very much.

What impact will Oprah Winfrey have when she campaigns for Barack Obama this weekend in three key early primary states? One thing we know for sure, free tickets to the events are going very, very fast.

Let's go to our Internet reporter, Abbi Tatton. She is here.

How hard, Abbi, is it to get these tickets?

ABBI TATTON, CNN INTERNET REPORTER: Well, Wolf, the event in Manchester, New Hampshire, the campaign says now is waiting-list only.

And, in Columbia, South Carolina, where that rally with Oprah Winfrey and Barack Obama is to be held in an arena that seats up to 18,000 people, Well, there's no free tickets available anymore there either, the campaign citing overwhelming demand.

The campaign has been touting that demand at their South Carolina Web site, showing the queues of people queuing up over the weekend for tickets. They said some people were even were camping out in sleeping bags. So, it's perhaps not surprising that you will find a couple of those tickets now on eBay, someone claiming to have a pair of the Columbia, South Carolina, tickets, seeing multiple bids going on there right now.

The Barack Obama campaign directing people to waiting lists online for these events. Or there is always Iowa, where there's a couple of events happening there this weekend as well, tickets available online for that starting tomorrow -- Wolf.

BLITZER: Thanks, Abbi, very much -- hot tickets in Iowa.

President Bush is sticking to his guns on the Iranian nuclear threat, and he's throwing new fuel on a hot campaign issue.

J.C. Watts and Peter Fenn, they are standing by live to gauge the fallout from that shocking new intelligence report on Iran.

Also in our "Strategy Session": Mitt Romney's big religious speech, it's coming on Thursday. Will it ease concerns about his Mormon faith or create new ones among voters? We will assess that and more when we come back.


BLITZER: Mitt Romney is set to do something he hasn't yet done during his campaign. That would be talk extensively about faith in America. This comes amid some concerns by some out there about his Mormon faith.

Romney spoke to CNN's Gloria Borger just a little while ago about his thinking just ahead of the speech.


MITT ROMNEY (R), PRESIDENTIAL CANDIDATE: I find that the people that I talk to and that come to rallies that I attend overwhelmingly say what you heard today, which is, they don't choose a person based on which church they go to. They try and understand what their values are, what their vision is for the country, what kind of experience they have had to demonstrate...


BLITZER: Let's talk a little bit more about this upcoming speech. Joining us in our "Strategy Session," Democratic strategist Peter Fenn and our CNN political analyst J.C. Watts. He's a former Republican congressman from Oklahoma.

It's a tough challenge for him, because expectation is already high for this speech on Thursday.

PETER FENN, DEMOCRATIC STRATEGIST: Expectations are very high, Wolf. He has got to move things in Iowa quickly. He has to get to those evangelical voters, convince them that he is OK.

And I will tell you, the difference between this and Kennedy, there are many of them. The Kennedy speech...

BLITZER: The Kennedy speech back in 1960.


FENN: He already had won the West Virginia primary, where they said a Catholic could not win. He was speaking to a general election actually .

This is a tricky one, definitely, for -- for -- for Mitt Romney.

BLITZER: He is clearly seeing some heat from Mike Huckabee, and he's going after those Christian evangelical voters in the Republican Party. And I sense that is one of the reasons he decided to deliver this speech?

J.C. WATTS, CNN POLITICAL ANALYST: Well, Mike Huckabee's faith is interwoven into his daily life. So, it's just -- I mean, it's -- it's there. He doesn't wear it on his sleeve.

Mitt, everybody is asking questions about it. And I said three months ago that I felt like he should define what his faith is. Don't allow your political opponents to define you as a Mormon, as a Baptist, as a Catholic, or whatever.

John Kennedy did not allow his opponents to define his faith. He did that. And I think it's going to be a good thing on Mitt's part to say: This is who I am.

BLITZER: And to explain, you know, this is what it means to me to be a Mormon, as Kennedy, I think, sought to explain this, this is what it means to me to be Catholic?

FENN: That is partially it.

But, also, you have to remember that, Wolf, what Kennedy was doing was saying, there should be separation between church and state. And he said it very unequivocally, you know: I believe in an America where the separation of church and state is absolute.

That was a line from his speech. And you're not going to hear that from -- from Mitt Romney. I think the other thing that Romney should do, to be honest, is, don't just get up there, give a speech, and walk off. I think he has to answer some of these questions that J.C. was talking about. What is it about Mormonism that makes people nervous?

You have got to answer that question, and directly to the voters.

WATTS: Well, Wolf, people are -- a lot of people are ignorant on Mormonism. They -- you know, they read different things. They see different things. And -- and that is what they associate it with.

I think Mitt has to say: This is who I am. This is what I believe. But I think, at the same time, he has to remind people, as Kennedy did, you're not voting for a pastor in chief. You're voting for a commander in chief.


BLITZER: Peter, what is going to be the political fallout from this new national intelligence estimate that now says the Iranians actually stopped working on a nuclear weapon four years ago?

FENN: You mean we're not going towards World War III?

BLITZER: Apparently not.

FENN: You know, Armageddon is not coming? You mean we're not -- as Bolton was talking about, a holocaust here?

Look, hopefully, this puts an end to the whole notion I think that the neocons want, which is, we have got to go into Iran. I mean, we don't have to go into Iran. This should be the -- this should be the bottom line.

The other thing politically, I think, about this, Wolf, is that it is saying to folks, look, let's take a step back. Let's calm down here. Let's talk about negotiating more and being less bellicose.

WATTS: Well, Peter -- and I think that is the key. I don't think anyone -- I -- the people, the circles that I run in, the conservative circles, they have never said, we have to go into Iran.

But I think the key is this. Take a step back, take a deep breath, because the NIE -- I'm amazed that it took them four years to conclude this. I think that's pathetic. But, secondly, I think they do have to understand that the NIE also concluded, Iran is keeping open its options to develop nuclear weapons. They are still enriching uranium.

So, I think we trust, but verify.

BLITZER: Well, we have got to leave it right there, because I'm suspicious that there is going to be a lot of political fallout as a result -- I suspect there's going to be a lot of political fallout as a result of this.

Guys, thanks for coming in.

FENN: Thank you.

BLITZER: And a new embarrassment for Hillary Clinton and some other Democrats: A former fund-raiser now stands indicted. There are new developments in that case that sent some shockwaves through Democratic campaigns.

Also coming up: He knows a thing or two about being an insurgent presidential candidate, but does Pat Buchanan think the time is now right for a third White House -- third-party White House hopeful?

And we will tell you why some Catholics and evangelicals are raising some red flags about a fantasy epic headed for a movie theater near you.

We will tell you all about that and a lot more -- right here in THE SITUATION ROOM.


BLITZER: Let's check our Political Ticker.

A one-time big-money fund-raiser for Democrats like Hillary Clinton, Barack Obama now stands indicted -- Norman Hsu facing 15 counts of fraud and violating campaign finance laws. The indictment by a federal grand jury in New York was unsealed today. Hsu is accused of swindling at least $20 million from investors in a campaign fund-raising scheme. The Clinton and Obama campaigns and others have returned money Hsu's donations or given the money to charity.

Republican presidential hopeful Rudy Giuliani now has stepped down as the head of his consulting firm, Giuliani Partners -- this coming after months of refusing to disclose the firm's client list, amid questions about potential conflicts of interest for Giuliani.

A Giuliani spokeswoman says the former New York mayor has been replaced by his longtime friend and former aide Peter Powers -- no word on whether Giuliani will keep a financial interest in the company.

Remember, for the latest political news at any time, check out our Ticker at

Let's check out Jack Cafferty and "The Cafferty File" right now -- Jack.

CAFFERTY: What do you suppose took Giuliani so long to figure out that was probably a good idea, to disassociate himself?

BLITZER: I don't know.

CAFFERTY: You don't?


CAFFERTY: Get our -- get our investigative staff...



CAFFERTY: ... on to that, will you?

The question for the hour: What is the single most important task that Congress must complete before adjourning for the holidays?

Ed writes from Montana: "Energy should be the first priority. Solving the energy problem is the lead domino for solving America's problems. Solve energy, and you solve most of all the foreign policy problems, because then we don't need Middle East oil."

Judy in Exeter, California: "Amend the alternative minimum tax. If that isn't done, millions will be penalized and it will wreak havoc on the middle class and the economy. Number two, uphold their campaign promise to bring our troops home. Number three, secure our borders. Number four, do away with the lobbyist system. Just think of the problems that would solve. And, number five, put impeachment back on the table."

Michael in Los Angeles: "Take a stand on the Iraq war and stare down President Bush. Nothing else comes close. Use their power once and for all to show the beauty of how our country was designed to ensure the balance of power. If they don't blink on that, and then pass legislation to ensure that America will become energy- independent, not buying a single drop of oil from the Middle East by 2012, then they will have finally taken a leadership stance on something that matters."

Tim in Wisconsin writes: "Reid and other Democrats are more interested in their political agenda and scoring points than what matters to the middle class. The AMT, alternative minimum tax, has gone unaddressed because these same politicians who scream about other inequities don't really care at all. And this hangs Americans who are in real need."

And Alan in Missouri writes: "Accountability. Impeachment and prosecution of criminals for war crimes and deception of the public. Not on the table, I know, but, then, my priorities and those of my legislators are rarely the same" -- Wolf.

BLITZER: Jack, see you in a few moments. Thank you.

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